Global SAF goals possible with right support: Byogy

Governments worldwide need to step up to attract capital investment into sustainable aviation fuel (SAF) to meet ambitious climate targets, the chief executive of SAF producer Byogy Renewables Kevin Weiss tells Argus.

The International Air Transport Association this month approved a resolution to achieve net-zero emissions by 2050. This envisions a base-case scenario of SAF comprising 2pc of the jet fuel mix by 2025 and up to a 65pc share by 2050 or 449bn litres/yr. Is this a realistic goal?

It is realistic but many things must happen. The regulatory criteria need to support the deployment and commercialisation of these technologies to meet those goals. Private capital is still hesitant to aggressively invest in new plants, as the production takes hundreds of millions of dollars for commercialisation. While the overall sector today is significantly more upbeat than even three years ago, private capital still shows signs of caution to ensure their returns.

The elevated demand is now pulling the industry and backed by the mechanisms of Corsia [Carbon Offsetting and Reduction Scheme for International Aviation]and International Maritime Organisation in shipping. But these placeholders alone are not going to be significant enough to hit the targets and now governments need to stand up and support the industry similar to what they did with solar and wind, giving ample opportunity for affordable capital.

With proper regulator incentives, significant government investments, and a continued rise in demand, these emission reduction targets are reasonable.

Covid-19 has been brutal for the global airline industry during the past couple of years. But if anything the momentum for SAF snowballed, what do you put this down to?

I've been in this industry for 16 years and seen first hand the ups and downs and the smoke and mirrors of this industry. The catalytic change today is based on the social environment we all live in now. Ten years ago it was like pushing a string trying to raise the capital and launch a liquid renewable fuel industry, especially SAF, since airlines had no incentive to pay a premium. Primarily people were excited about it but only when oil was $135/bl. And as we saw with the economic crash when oil went to $38/bl the industry vanished.

A few technologies have survived, primarily because the technology platform is able to scale at a cost that is reasonable going head to head with oil. Fast forward a few years and the tide has changed, as the new generation is demanding a lifestyle of sustainability. Believe in global warming or not, the household demand for living a sustainable life, from the food we eat to the cars we drive, has shifted. That dynamic has pushed, and pressured the industry in such a rush whereby directors of ESG [environmental, social and governance] are present on every board of all large companies in the world.

Today we are now closer to the end of the runway where the airlines are pressured to either integrate SAF into their operation, or accept writing a cheque to offset carbon. The answer for years has been to simply wait and see. Now the time is up. The big paradigm shift of driving demand from consumers is forcing the airlines to respect the people on their planes who want to live their life sustainably. You are no longer part of the club if you are not integrating SAF into your fuel supply. It's no longer enough to say we're just going to do a market-based measure or even write a cheque, or plant a tree.

As you say we've seen a few airlines use these market-based measures such as carbon offsets. But that comes with accusations of "greenwashing" and companies increasingly view SAF as the better option.

Precisely. There's always a transition period made up of people who are leading it, people who want to be in it, people on the fence about it and those who are still in the barn. As that transition happens you create a competition phase where people come out of the barn, the people who were on the fence jump off it and the people who didn't want to do it are now being pressured to find a way.

You've set up a demonstration plant in Japan and levelling up to a full-scale 30mn l/yr commercial plant by 2025. How did this project come about?

We were the pioneers of alcohol-to-jet technology and one of the first producers to be able to produce full replacement SAF. We were sought after in 2018 by Nedo [New Energy and Industrial Technology Development Organisation] Japan who are leading the Asia-Pacific drive to sustainability. We were funded by them and local cellulosic ethanol producer BITs [Biomaterial in Tokyo] to build a demonstration plant for the Olympics in Tokyo, which we built in the US and shipped there, assembled it but had to turn off in March 2020 because of Covid-19. We have now re-engaged and are working closely to recommission the plant. The Japanese government desires to actively be a global player in renewable fuel production. We are now engaged to start design and ultimately build a second 3mn l/yr commercial demonstration plant with the same technology partner and the Japanese government. The designing phase will begin next quarter and construction will hopefully start later next year with the goal to be up and running in 2023. During this time we will overlap design on a larger scale commercial plant targeted for production in 2025.

In parallel with that we were awarded a US Department of Energy (DOE) contract two years ago which has finally procured to a point of engagement and getting funded. We will start design in Q4 2021 on a small commercial plant of 1.5mn-5mn USG/yr. That design is being funded by the DOE and we hope to have that running in a location to be determined by 2023. The design will leap us into a parallel design of a larger 5mn-10mn USG/yr plant that would put us in the commercial space in 2025-2026.

Japan doesn't yet have any SAF mandate, much like the rest of Asia, although its airlines such as ANA and JAL have been taking it upon themselves to develop SAF projects and supply chains anticipating 396,000 b/d of Japanese demand by 2050. Do you see it as just a matter of time before the government gets on board and starts setting SAF incentives or mandates?

In my experience the rush to publish goals is one tactic but engaging the actual private capital deployment and funding is the real tactic. A mandate is only as good as the capital behind it. It's great to have these mandates but I do not put much weight in just mandates alone. Also, I would never underestimate the Japanese to be a leader in the renewables space. Just because they're not publishing something does not mean that they are not, behind the scenes, developing technologies at a rapid pace. To this end they are not only developing the means to commercialise technology, but actually writing the cheques and funding it aggressively, quickly, and quietly.

I like the mandates but if there isn't a mechanism or vehicle behind them to allow a private capital infusion and deployment strategy then they're only as good as the words on the paper they're written.

By Amandeep Parmar

Kevin Weiss will be one of the speakers at the forthcoming Argus Biofuels Europe and Asia Markets virtual conference, which takes place over 9-11 November. For details of the conference programme and how to register to attend, visit our website