Renewable natural gas (RNG) producers are eying opportunities for increased use in the aviation sector as a feedstock for sustainable aviation fuel (SAF).
RNG to date has mainly been used in compressed natural gas vehicles and, to a lesser extent, by utilities. But the fact that aviation is included as an opt-in fuel credit generator in the California and Oregon low-carbon fuel standard (LCFS) programs and it can receive the federal blenders tax credit, opens the door to RNG being used in aviation, delegates said this week at the RNG Coalition conference in Dana Point, California.
"When you start to stack that up it is an attractive set of policies," biofuels producer SkyNRG chief executive John Plaza said.
SkyNRG Americas is focused on developing dedicated SAF production facilities to supply airports in the western US. The facilities will process municipal solid waste (MSW) and other waste-based feedstocks.
Aviation fuel demand along the US west coast provides a "massive market opportunity" for both landfill and dairy derived biogas, with low-carbon fuel markets set to span the entire coast, he said. The industry has a long way to go to reach President Joe Biden's goal of 3bn USG of SAF available by 2030 and utilizing all resources will help achieve this, he said.
SAF to date has been a small part of the California LCFS in terms of both fuel use and credits generated. It generated roughly 16,000 credits in the third quarter of 2021, a drop in the proverbial bucket of the 4.9mn t credits generated by all low-carbon fuels that quarter. Its growth has been impeded by the fact that the incentives for renewable diesel are greater than those for SAF, making it less financially attractive for producers to focus supply on the latter. A large proportion of SAF feedstock is derived from waste animal fats and cooking oils.
RNG also provides a strong opportunity in hydrogen, delegates said throughout the three-day event.
Flexibility is "the key" for RNG use, Aemetis president Andy Foster said. The company is using its RNG for both electricity and hydrogen use.
Hydrogen derived from RNG can be carbon-negative and utilizing the resource for this purpose can help in making hydrogen "ubiquitous, easy and local," Stewart Stewart, chief commercial officer at Bayotech said at the event. The company is aiming to build out a network of hydrogen hubs.
The economics of RNG can favor larger projects which can have expensive interconnection processes in getting it into the grid, Stewart said. Using the resource for hydrogen in fuel cell vehicles can circumvent that barrier, he said.
Using RNG use for on-road transportation is the largest source of the biofuel because it can capture both LCFS credits and federal RINs but producers are increasingly eyeing additional opportunities, including the voluntary market, selling to corporates and utilities. There has been increased interest in the RNG space because of multiple end uses, participants said at the event.
