The worldwide commercial aviation industry uses an estimated 70 billion gallons of fuel annually, producing roughly 2% of global greenhouse gas emissions.  Business-as-usual estimates for CO2 emissions from the global aviation industry projected by the International Energy Agency show increases of 3.1% per year over the next 40 years – resulting in a 300% increase in emissions by 2050.  However, the industry has taken significant strides in recent years to stabilize, and ultimately reduce, its contribution to global emissions.

Led by the International Civil Aviation Organization (ICAO), the commercial aviation industry has set two aspirational goals to guide policy: carbon-neutral growth by 2020 and a 50% reduction in industry emissions by 2050.  The integration of aviation biofuels derived from sustainable feedstocks like jatropha, camelina, municipal solid waste (MSW), and algae is a key component of achieving both goals.  Yet, national sovereignty and international agreements on the freedom of the skies are hampering efforts to impose a carbon tax that would encourage the integration of such fuels.

In an effort to compel airlines to implement emissions reduction measures, the EU rolled airline emissions into its Emission Trading Scheme (ETS) in 2008.  Originally scheduled to take effect in 2012, the market-based effort triggered direct opposition from the ICAO, which sought a global solution.  It also led the United States, China, India, Russia, Japan, and some Persian Gulf nations to threaten retaliatory trade measures.

In the United States, the aviation industry spent nearly $5 million in 2012 to support fierce political opposition, culminating in President Obama signing into law the European Union Emissions Trading Scheme Prohibition Act on November 27.  The bill gives the U.S. Transportation Secretary the power to shield U.S.-based carriers from the tax.  This effectively allows U.S. airlines to ignore the EU-imposed tax.

Blackmail, Black Market

Chinese and Indian airlines, meanwhile, refused to submit emissions data as part of the EU scheme.  China also threatened to withhold aircraft orders in excess of $3.8 billion from Airbus if the EU proceeded with the trading scheme.  The Indian government has been a staunch critic of the scheme, arguing that the EU plan would result in the formation of a black market for airline emissions credits.

Facing international pressure from major powers and key trade partners, the EU’s three most powerful members – Germany, the United Kingdom, and France – forced a 1-year postponement of the Airline Amendments to the ETS pending an anticipated agreement on a multilateral global alternative program.   The latter program is scheduled to be negotiated in the ICAO Assembly in 2013.

Although aviation’s contribution to global emissions is not overwhelming, the suspension of the ETS creates an environment of uncertainty around aviation biofuels, potentially stifling investment in drop-in conversion technologies that have yet to cross the commercial threshold.  Lack of long-term policy certainty has routinely been cited by industry sources as a key barrier to biorefinery construction and advanced biofuels scale-up.

Despite opposition to the EU plan, the U.S. government still strongly supports the development of aviation biofuels.  The Federal Aviation Administration (FAA) has called for the aviation industry to use 1 billion gallons of alternative jet fuel per year by 2018.  Moreover, the U.S. Department of Defense remains one of the most enthusiastic proponents of aviation biofuels.  Recent legislation passed by the U.S. Congress has signaled a commitment to public-private partnerships to build out domestic infrastructure for the production of advanced biofuels, including drop-in fuels compatible with existing commercial and military aircraft.

In November the U.S.  Senate voted 62-37 to strike language from the annual defense appropriations bill that would have prohibited the Department of Defense (DOD) from buying alternative fuels if they cost more than conventional petroleum-based fuels.  Estimates of commercial aviation biofuel prices are around $5 to $7 a gallon, while conventional petroleum-based fuel is around $3 per gallon.  The DOD is the largest consumer of oil in the world and in recent years has been a leading advocate and investor in advanced biofuel development.  Had the restrictive language been permitted, it would have been a crippling blow to the domestic and international aviation biofuel industries, grounding their encouraging recent advances globally.

Unlike petroleum-based fuels, biofuels have many feedstocks that can originate from almost anywhere.  The costs of distributing a specific biofuel over a wide area, however, make any specific biofuel less competitive against petroleum-based competitors that have better price points and distribution networks.  Therefore, the standardization of one biofuel from one feedstock across the globe is unlikely.  Rather, many biofuels from varying feedstocks will emerge in regional markets.

Aviation biofuels add another variable in that the purpose of aviation is to travel to different regions of the world where departure point and destination may not have the same biofuel supply originating from the same feedstock.  The present issue, though, is finding the most sustainable feedstock at the most competitive price, something many are trying to do across the globe.  Below, a roundup of aviation biofuel initiatives in selected countries.

United States

In late May, United Airlines, Boeing, the Chicago Department of Aviation, the Clean Energy Trust, and Honeywell UOP created the Midwest Aviation Sustainable Biofuels Initiative (MASBI).  The Midwest offers the largest potential feedstock for biofuel development in the country.  The initiative is meant to evaluate challenges in biofuel development as well as potential Midwestern feedstocks.  A report on initial conclusions of varying feedstock viability is due later this month.

China

In late August, the Commercial Aircraft Corporation of China announced that it will collaborate with Boeing on refining waste cooking oil into jet fuel.  China produces 29 million tons of the waste oil while consuming 20 million tons of petroleum-based jet fuel annually.  Boeing claims price parity can be achieved within 10 years.  In addition, by 2020, the Chinese Civil Aviation Authority expects 30% of the country’s jet fuel consumption to be met by biofuels.

Brazil

The long-time leading producer and consumer of sugarcane-based biofuels for the automotive market, Brazil is now taking steps to enter the aviation market.  In mid-2011 Boeing announced a partnership with Brazilian aircraft manufacturer Embraer to assess potential jet biofuels.  In April 2012, Boeing expanded its depth in the region by establishing Boeing Research & Technology-Brazil.  The center will be an innovation hub for public organizations, private sector companies, and universities to collaborate on an assortment of aerospace technologies including biofuels.

Canada

The National Research Council of Canada flew the first civil jet on 100% unblended biofuel in early November.  The jet was powered by biofuel created from a genetically engineered Ethiopian mustard seed produced by Agrisoma.  The seed will now be grown on 6,000 western Canadian acres on behalf of 40 commercial farmers.

Other significant advances in aviation biofuels are occurring in 18 other countries using a variety of feedstocks, from Camelina in Spain to woody biomass in New Zealand.  Most of these developments are in their initial research phases, and any significant penetration of biofuel into the aviation fuel supply chain is still distant.  The future of aviation biofuels is not a sure thing; however, it is conceivable to consider that airplanes will eventually fly around the world using sugarcane grown in Brazil, Ethiopian mustard seed grown in Canada, or waste cooking oil produced in China.