The Economist – February 2011
Spooked by the spike in oil prices in 2008 and warily eyeing the latest spurt in fuel charges, airlines have noted that the costs of not going green are growing. In particular, they fret about the painful levies on carbon-spouting planes to be imposed under the European Union’s Emissions Trading Scheme (ETS). From 2012 all airlines operating in the EU will be expected to cut emissions to 3% below the average annual figure for the period between 2004 and 2006, and by a further 2 percentage points in 2013. Although most emissions allowances up to the cap will be allocated to airlines for free, 15% will have to be acquired in auctions. Any further emissions will require trading in additional permits.
Little wonder, then, that the queue of carriers hopping on the biofuel bandwagon is growing. Lufthansa, Ryanair and Easyjet are only the latest reported to be seeking a deal with Solena, an American producer of aviation biofuels. At the start of January it emerged that Qantas, the Australian flag carrier, will work with the same company to build a commercial-scale aviation biofuel plant on the outskirts of Sydney. Solena is already building a similar plant in London, which is scheduled to produce around 70m litres (16m gallons) of biofuel a year from 2014. Burning this instead of the equivalent amount of kerosene would reduce BA’s carbon emissions by about 2% a year, as much as is produced annually by all flights going in and out of London’s (admittedly small) City Airport.
The reason for Solena’s sudden popularity is that by making biofuels from waste, the company has dodged some of the problems that have bedevilled production of crop-based varieties. These include inadequate supplies of biomass to meet even today’s demand, and the related worries about how the push for more such crops may encourage land-clearance and lead to rising food prices. To illustrate the point, Greenpeace, an environmental lobby group, calculated that a test flight by Virgin Atlantic in 2008 that powered one engine of a Boeing 747-400 with a 20% biofuel mix of babassu oil and coconut oil used the equivalent of 150,000 coconuts.
If all four engines were powered by biofuels alone, 3m coconuts would have been required, leading the group to dismiss the exercise as a “high altitude greenwash”.Then there is the long list of exacting technical and commercial specifications aviation biofuels will need to meet. They must pack a lot of energy into a small volume, remain liquid at -50°C, come in chemically identical form all over the world, mix well with existing fuels, and improve, or at least match, those fuels’ efficiency. All that without requiring any serious tweaks to existing aircraft.
One-off tests of “drop-in” biofuels, ie, ones that can be mixed with standard kerosene, have been conducted successfully by airlines, including Qatar Airways, Continental, United, Air New Zealand and Japan Airlines. Lufthansa has gone further. In November 2010 it announced plans to carry out a six-month trial of the longer-term effects of biofuels on aircraft engines. Beginning in April, one engine on an Airbus A321 plying the route between Hamburg and Frankfurt route will run on a 50-50 mix of biofuel and kerosene.
Until more such tests have been carried out successfully, the 50-50 mix is all that certifying agencies will permit, so a wholly plant-derived aviation fuel remains a distant prospect. However, now that the ETS and other considerations have registered on the International Air Transport Association’s (IATA’s) radar, that industrial lobby group reckons biofuels could account for 6% of all aircraft fuel by 2020, reducing carbon emissions by over 4%, or more than 20m tonnes, from current levels.
The technology does not come cheap. IATA predicts that an investment of $10 billion-15 billion will be needed to reach the 2020 target. The plants in London and Sydney are expected to cost $300m apiece. However, for an industry that is coming to see biofuels as a hedge against tighter environmental regulation, rising fuel costs and damage to reputation, it may be a price worth paying.