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October 5, 2018
On October 4, a Virgin Atlantic Boeing 747 ran the first-ever commercial flight using LanzaTech’s waste-to-ethanol technology. Using flue gas from carbon-intensive industrial processes, such as steel mills, U.S.-based LanzaTech is able to create a jet fuel that has a 70 percent lower carbon footprint as compared to traditional fossil-based jet fuel. It’s worth noting though, that the CO2 was captured at a steel mill in China, and converted to renewable jet fuel in Georgia. Why not capture and convert domestic CO2? It’s largely policy related. All signs are indicating that the U.S. will be left behind in the development of a new and major industry, unless the prevailing headwinds change quickly.
With funding and support from the Pacific Northwest National Laboratory (PNNL), and the Department of Energy’s Bioenergy Technologies Office (BETO), LanzaTech has built a unique carbon recycling system that is similar to ethanol production, but instead of fermenting sugars (from corn or other organic materials), the company turns carbon dioxide and other waste gases into ethanol using a strain of bacteria. The ethanol is then converted to alcohol-to-jet fuel, a drop-in renewable fuel replacement for traditional fossil-based jet fuel that can currently be used in a 50 percent blend with fossil-based jet fuel.
According to the PNNL deputy manager for energy efficiency and renewable energy, "This fuel exceeds the properties of petroleum-based jet fuel in terms of efficiency and burns much cleaner.”
Aviation Emissions Expected To Increase
Aviation accounts for two percent of global greenhouse gas emissions. Two percent may not sound like much, but if aviation were a country, these levels would make it the seventh-largest emitter in the world. Moreover, these emissions are expected to rise significantly in coming years. In the United States, the Federal Aviation Administration estimates U.S. aviation emissions will rise by 100 percent by 2050 under a “business-as-usual” scenario, due primarily to increases in air travel.
Under the Obama administration, the U.S. Environmental Protection Agency issued an endangerment finding for aircraft, indicating that greenhouse gas emissions from aircraft are hazardous to public health. This finding requires the EPA to begin crafting regulations for aircraft emissions.
At the global level, the International Civil Aviation Organization (ICAO) announced a market-based CO2 reduction measure in 2017, designed to help stabilize future emissions at projected 2020 levels. The airline industry’s trade organization, IATA, has also committed to freezing aircraft emissions to 2005 levels by 2050.
Biofuels – derived from waste gases or more traditional sources such as crops or agricultural wastes – will play a role in meeting these standards and reducing overall aviation emissions, in addition to other energy efficiency measures, but U.S. policy is currently providing a disincentive to develop these fuels domestically.
Aviation Biofuels Receive Lopsided Treatment in U.S. Renewable Fuels Policy
LanzaTech is a Chicago-based company, but is largely commercializing its process overseas, in China, India, and now the United Kingdom (UK), due primarily to a more favorable policy environment for low carbon fuels in those countries. While the U.S.-based Renewable Fuel Standard (RFS) and California’s Low Carbon Fuel Standard (LCFS) do consider renewable jet fuel as a qualifying fuel under the program, the math is in favor of creating straight ethanol.
That’s because it takes over two gallons of ethanol to produce one gallon of jet fuel. This provides a very strong financial disincentive to produce renewable jet fuel in the United States, as ethanol credits under both the RFS and the LCFS are worth twice as much as renewable jet fuel credits.
It’s thought that new policy developments to incentivize carbon recycling could help move the needle for growth in domestic renewable jet fuels production. The newly enacted 45Q tax credit for carbon utilization, along with this week’s news that the LCFS will provide a credit for carbon sequestration in combination with biofuels production, may provide some incentive for companies who want to produce jet fuel from recycled waste gases. However, these waste-to-energy processes do not currently qualify as fuels under the RFS, and would be ineligible to receive credits, thus further tipping the scales.
LanzaTech Eyes UK as Favorable Environment to Grow Business
LanzaTech estimates that their process of converting waste CO2 to jet fuel could displace as much as 20 percent of petroleum-based aviation fuel, yet there has been no indication that they will grow their business in the United States. Virgin Atlantic CEO Richard Branson would like to see the UK become a major hub for the low-carbon aviation fuel, urging the creation of three facilities, which could produce up to 125 million gallons per year of the fuel.
The UK has invested 100 million pounds into low carbon industrial innovation, with Energy and Clean Growth Minister Claire Perry commenting that the money will “ensure we modernize our industries and accelerate the shift to low carbon transport.”
After the flight landed in London, Branson commented, “Working with LanzaTech will enable us to greatly reduce our carbon emissions and, at the same time, help support UK industry … This fuel takes waste, carbon-rich gases from industrial factories and gives them a second life so that new fossil fuels don’t have to be taken out of the ground.”
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