A New Era Gets Fueled Up

Dec. 28, 2016
With biojet and unleaded avgas coming onto the market, what do airports and FBOs need to do to be prepared?

At Seattle-Tacoma International Airport (Sea-Tac), Alaska Airlines is forging ahead with plans to implement a biofuel supply for its commercial jets.

On Nov. 14, Alaska had a commercial flight using a Boeing 737-800 travel from Sea-Tac to Ronald Reagan Washington National Airport (DCA) using alternative jet fuel made from forest residuals. About 20 percent of the biofuel was blended in for the flight, using about 1,080 gallons.

Carol Sim, director of environmental affairs for Alaska Airlines, said the company’s move to new fuel began about seven years ago when a group of stakeholders in the Pacific Northwest called Sustainable Aviation Fuels Northwest (SAFN) — which included the airline, the Port of Seattle, Port of Portland, Port of Spokane, Boeing and various government entities — wanted to determine if there was a feedstock available in the region to support a viable biofuel industry.

In 2011, ASM approved conversion technology for HEFA, so the airline decided to do something in that space and conducted 75 flights in a one-month time.

“With the exception of United’s AltAir facility in LA, there currently is no commercial supply available in the United States,” Sim said. “So all of the flights that we’ve done have been batch scaled production of the fuel.”

From 2011 to 2016, there were no new technologies approved by ASM, but in March, Gevo received approval for its alcohol-to-jet conversion technology. Alaska flew its first alcohol-to-jet commercial flight in June. By November, Sim said the airline conducted its first wood-to-wing flight, which they developed through a program with the U.S. Department of Agriculture (USDA) cooperative agriculture program grant ran by Washington State University to prove forest harvest residues can be made into jet fuel.

“We have a 2020 sustainability goal to have a commercial supply of alternative fuels at one of our airports,” Sim said. “We’re focused on Sea-Tac right now since that’s our hometown airport and our largest fuel intake.”

Adam Klauber, director of sustainable aviation for Carbon War Room (CWR), said the usage of the alternative fuels is one of the most promising areas of reducing overall emissions at airports. The company is currently working with Sea-Tac on a biofuel program so it can become a leader in providing the fuel for commercial aircraft.

Klauber said the Port of Seattle is looking at regional economic development and what different ways it can get involved on the infrastructure side.

Stephanie Meyn, climate protection program manager for Sea-Tac said the infrastructure study for the project will be released to the public in the coming weeks to highlight what will be needed to accommodate the biojet fuel followed by the financial report.

“When you start just looking at infrastructure and pipelines you’re just looking on a map and thinking ‘we just need to bring some fuel into a facility and it’s as simple as drawing lines on a map,’ but that’s of course a naïve notion,” she said. “Once we really dug into it we understood a lot more of the logistical challenges, but the outcome isn’t really a surprise. It’s very common sense where we landed.” 

One of the findings is the difficulty of finding a place to blend the biofuel. Without a large volume production facility it’s difficult to scale the operation.

“I guess that’s part of the naïve notion category of the findings,” Meyn said. “As soon as you’re talking about a rail offloading facility and creating storage for railcars to do the offloading, that kind of facility is such an investment and so expensive that until you have large volumes you really want to focus on sort of a small-scale kind of truck offloading facility that still makes it easy to integrate into the fuel, but it’s just not kind of the extreme expense compared to a really full scale offloading facility or even a small-scale offloading facility."

Meyn said the biofuel volume being produced at Los Angeles International Airport (LAX) right now is roughly 10 million to 30 million gallons per year. Five million gallons to 10 million gallon production is one or two trucks per day. The Seattle region needs more especially if it's going to keep growing.  

“We need more truck offloading positions even for our emergency supply needs so even if the pipeline did go down the only way to get fuel here is by truck,” she said. 

"If you’re going to do something small-scale when you don’t have large production in state yet, it makes sense to really look at redundancy and usefulness of infrastructure for other purposes until such time as you have the biofuel flowing,” Meyn added.

Moving Airports to the Next Generation

In January 2016, Air BP worked with Avinor and SkyNRG to deliver biojet via hydrant system at Oslo Airport Gardermoen. Jon Platt, CEO of Air BP, said there has been no surprises with the system or using the existing infrastructure for delivery.

“There’s no need for a segregated value chain,” he said. “Jet meets the specification when it’s in the commingled system. Biojet meets that specification and the difference is how the manufacturing process works as opposed to it being a different product.

“It’s not a different product and it can go into the commingled system.”

Craig Sincock, Avfuel president and CEO, said the success of a new form of fuel like unleaded avgas not only depends on if it works in airplanes, but if it’s compatible with all the different fuel systems.

He said it would not be economically feasible to put in new infrastructure for a new product because you would have to redo all of the tanks, trucks and pump systems across the country.

“The fuel tank and the fuel pump and the lines that are up at Madison or Watertown, Wisconsin might be different from the ones at Traverse City or Santa Fe, New Mexico,” Sincock said. “You’ve got refueler trucks, we’ve got avgas storage and tanks around the country you have transportation…so success depends on compatibility with the existing infrastructure.

“We can’t just produce something environmentally friendly that works for an airplane,” Sincock continued. “We need feasibility of the whole structure of how this works and the goal is to find a solution that works within our current infrastructure that clearly.

Greg Still, general aviation manager for Phillips 66 Aviation, said the company is always doing research and development for unleaded avgas options as the industry starts to move in that direction.

He said there are a lot of questions that arise with making such a dramatic change in formulation of a product, but it’s working on all of the logistics and supply issues to make sure any new product is viable for fuelers.

“Our first objective is to make sure that whatever product we offer to the marketplace, it’s safe,” Still said. “In this case, it’s the flying public so we won’t do anything with a product unless it’s fully vetted and fully tested, so we’ll address whatever the issues of the day happen to be, whether it’s from the customers at FBOs or professionals that are actually flying the aircraft.

“The thing with any new fuel, it has to be economic in the industry, he continued. “It’s got to meet the needs of the flying public in this case and it can’t be priced to a point where you price it out of the marketplace, so whatever product ends up in the market it’s got to be priced competitively for the industry.”

Klauber said his company is engaged with Sea-Tac to help identify mechanisms to cover the costs of two different areas — covering the price premium for biofuel itself and the infrastructure to make it a reality. The finance mechanism report will be given to Seattle by the end of February, and the airport will decide how it will implement going forward.

“One of the tricky areas we have is the airport is not going to really buy the fuel, they’re going to cover the premium that may end up pushing the purchase of climate security,” Klauber said. “”We’re looking at how do we define a new product that airports can purchase that will be acceptable from a regulatory standpoint and also accomplish what the airports really embody and what they airport is trying to do with their actions on it, which is securing the climate.”

Klauber said he sees the biofuel premium as being one of the critical challenges to scaling biofuel and in a very competitive market like aviation the airlines any early adopter airlines will be at a competitive disadvantage because of the cost and will be reluctant to go into a large-scale procurement of the fuel.

“We’re trying to address the fact that conventional fuels — fossil fuels — continue to receive an exorbitant amount of subsidies and we believe that additional subsidies are necessary,” he said.

The existing mechanisms for financing biofuels include the real index number (RIN) set by the U.S. Environmental Protection Agency (EPA).

“That moves paradoxically to the price of oil, so as oil, as the price of the barrel drops, the RIN value gets more valuable,” he said. “That is helpful and a good start, but it’s not enough to cover the full premium.

Building Demand

Klauber said the state of California recently decided the low carbon fuel standard is an additional subsidy that may be available that would cover aviation by 2018.

“The California Air Resources Board (CARB) has given approval to look at including aviation because right now the focus has been exclusively on surface transportation due to local emissions focus,” he said.

Klauber said his organization is looking at a mixture of mechanism to make available for airports, which may include finding ways to use operational cost savings as a revenue source that can cover the cost of the fuel.

Another option is redirection tax money that should go to airports, but might not be in some states from the aircraft fuel tax that could go to infrastructure costs to provide cost savings for airports to be applied toward the biofuel program.

“We’re also looking at ways that there could be both ways to incentivize low carbon travel to the airport that also generates a fee for people who are getting to the airport in a more carbon-intensive way,” he said. “It could be a mutually reinforcing mechanism somewhere so someone traveling in a hybrid or electric vehicle may have a lower cost of parking or lower cost of tolling or for taxis.”

All of those options are promising for Seattle, Klauber said, but he expects each airport will require a different set of mechanisms that are appropriate to the local context.

Klauber said there may not be a strong fiscal case for pushing biofuel, but there could be a regional economic development case, so working with a broad set of stakeholders both locally and nationally could build a strong case for pushing biofuel development.

“One of the challenges for biofuels is the feedstock, the materials that are converted to bio crude are almost all across the board more expensive than oil, the finished product for petroleum,” he said. “So you’ve got a structural challenge where there needs to be more cost effective feedstock, so there’s a place for regional ag(riculture) or regional forestry to get involved.

Who Will See Change First?

Right now Klauber said airports with greater abilities with their resources and a regional interest in biofuels can help smaller airports located near them by supporting the availability of biofuels. 

“What we’ve seen with the pricing is when you’re very, very small…the cost is just extraordinarily high,” he said. “If we can start demand to help jump-start scaled supply chains and larger volumes, we believe this will help the industry and on a region by region basis.

“If there’s greater demand at Sea-Tac, then perhaps this will support Bellingham, this will support Spokane, this will help make the fuel more available regionally and more cost effective."

There’s a common misconception an airport must build special infrastructure for biofuel, but Klauber said this isn’t the case.

“The second generation biofuels, all of the ASPF certified fuels are second generation,” he said. “Those fuels are molecularly identical to fossil fuels. They don’t have oxygen, which could potentially cause corrosion; they’re stable and don’t require any special seals. They function as if they were a fossile product they’re replacing, with the exception of missing aromatics, which are important to the aircraft engine use, but not at all essential to the airport infrastructure.

Airports may need to be supplied a blending tank and pumps, which Klauber said is a relatively modest investment for biofuel.

“It’s likely that this would occur off the airport given fuel consumption preferences for having certified fuels once it gets within the fencing line,” he said. “However, Sea-Tac looked into potentially creating blending capacity at the airport itself to see if that’s viable and legal and it looks like it might be.”

If there’s blending occurs at airports it will require additional training and standard operating procedures for blending and containing unblended fuel, Klauber said, but if the blending occurs off-site, the training could be an informational session with staff about how biofuels are functionally identical to fossil fuels.

The advantage to on-site vs off-site blending could depend on the configuration of the facility if there availability of local facilities to blend fuel. The disadvantage of on-site blending is having to create separate features so the fuel is handled appropriately and only the certified fuel gets put into the fuel farm or hydrant system.

“The closer you blend to the airport, the better it is for moving fuel,” he said. “Once the fuel is blended you have to move the blended fuel together, so the fewer logistics, the less energy is necessary to move that fuel.”

Klauber said Carbon War Room is currently working with another airport in Europe on a similar project, which hasn’t been publicly announced yet and other airports are interested in the U.S. and Canada in creating program.

Pushing more airports to move toward biofuel may be the creation of regional supply chains getting airports moving fuel in a supply chain efficiency and scale of production facilities and new fuels set to come available as soon as 2018.

“Just as there is not just one renewable energy that’s going to replace fossil fuels on the electricity side, the same is true with aircraft fuels,” he said. “There are multiple feedstocks, there are multiple types of certified fuels that are needed, so there will need to be multiple approaches that will cover the premium.

Klauber said Oslo Airport is currently working to make alternative fuels more available at its fuel farm by partnering with local non-aviation corporate entities, which then sponsor the fuels.

“We see that as a possibility in Seattle as well as other airports,” he said. “We believe that corporate entities connect with their regional airports, they rely on them and will see benefit in participating in a corporate sponsorship program.”

Patrick Gruber, CEO of Gevo Inc., which created a technology to convert cellulosic sugars derived from wood waste into renewable isobutanol before further converting it into Alcohol-to-Jet (ATJ) fuel, said the airlines want the low carbon emission fuels to avoid piecemeal regulations across geographies they fly over in the future.

The type of fuel Gevo uses is blended in up to 30 percent and once set, it’s certified as standard jet fuel. At larger airports it can be blended on-site or in a central location and shipped because it’s the same as standard jet fuel.

“One of the things that are true of all these alternative fuels is that they’re all going to have to be blended,” he said. “There’s going to be a little bit of a competition amongst who is going to do the blending because someone can win some business if they want to be a blender and set up a pipeline.”

Gruber said there isn’t anything exotic about the biofuel systems, but some mechanical things need to be done. The fuel needs to be shipped via rail, so it needs to take place at a facility that can load rail cars with blended jet fuel.

Gruber said the company worked with Lufthansa to allow it to become an offtaker as Gevo builds out its commercial capacity.

“Some of these guys don’t realize that building a tank farm is not that expensive,” he said. 

Building a supply chain

In November, Air BP announced it will make a $30 million investment in Fulcrum BioEnergy, which includes as 10-year offtake agreement for 50 million gallons per year to distribute to key airport hubs across North America.

Fulcrum produces the fuel using municipal solid waste.

Platt said the investment is part of the company’s overall environmental solutions strategy. He said the industry is growing at about 5 percent every year, meaning it effectively doubles every 15 years.

“After fuel efficiency improvements even with some of the new aircraft that are coming on that are obviously more efficient, aviation carbon emissions continue to grow and they therefore continue to be a challenge for the industry,” Platt said. “They’re growing by about 2 percent per annum.”

Sincock said Avfuel has outlined to Swift Fuels its desire for an equitable distribution plan for unleaded avgas because the distribution model must include a path to get to all the major distributors of avgas. Fuel has to be stored, shipped via rail, provided to customers with the quality assurance they’re used to with traditional fuels and the suppliers must have aviation insurance and emergency response teams.

“Avfuel believes that if you want the product to be successful it’s such a boutique low volume product that whomever comes up with the magic solution has to make sure that all the distributors get it at a same price, equitable amounts and we don’t create the king avgas and let someone corner the market,” Sincock said. “You might go back tonight and ask 'geez, Craig, why don’t you want to be the king of avgas?’ Well, the reason for it is the industry isn’t big enough. This is tiny. Avgas is absolutely tiny. You need all of them. We need every one of my competitors to pull their volume together to come up with the best answer for distribution and the most competitive price for the industry because I’m also a pilot.”

Sincock said sticking within the system in place could also keep the new fuel from impacting quality control and safety standards.

“The system that’s out there now has worked so well for so many years and it comes from manufacturers and the fuel’s tested and it goes to the distributors and they have invested untold money into these systems of railcars and tanks and holding inventory and then it goes out to retailers, which would be the FBOs and they just take it right through the supply chain and these retailers many of the systems that they use are designed by the suppliers and distributors like ourselves,” Sincock said.

He said when the industry made changes in fuels over the years it shows it’s feasible to make change, but it’s important to focus on the supply chain as well as the airplane and its engine.

While Alaska hasn’t done a similar study with other airports about the biojet fuel, Sim said there’s interest in the aviation community at looking at this topic through the Commercial Aviation Alternative Fuels Initiative (CAAFI). 

Alaska is looking at other areas where it could make sense, but Sim said they don’t have any definite ideas at this time.

A big challenge for airlines is the lack of available biofuel producers, Sim said. There are producers planning to come online in the near future, but this has been an ongoing issue within the fuel-producing arena.

“Right now it’s just having fuel,” she said. “There are a lot of projects out there that are being worked on as far as standing up plans, improving the technology, but right now there is no commercial supply.

“There’s nobody that I can say I’ll buy your fuel, put it into my infrastructure."

About the Author

Joe Petrie | Editor & Chief

Joe Petrie is the Editorial Director for the Endeavor Aviation Group.

Joe has spent the past 15 years writing about the most cutting-edge topics related to transportation and policy in a variety of sectors with an emphasis on transportation issues for the past 10 years.

Contact: Joe Petrie

Editor & Chief | Airport Business

[email protected]


>> To download the AviationPros media kits, visit: Marketing Resource Center

>>Check out our aviation magazines: Ground Support Worldwide |  Airport Business  | Aircraft Maintenance Technology