Maximizing the Value in SAF

Through optimal business strategy, innovative technology and a firm grasp on the market, Green Plains is leading the charge into alcohol-to-jet.

- By Todd Becker

United Airlines, ranked among the world’s five largest airlines, consumes billions of gallons of fuel each year, flying travelers all over the globe. Aggressively pursuing its goal of carbon neutrality by 2050, the company is wasting no time scaling up its use of sustainable aviation fuel (SAF)—the most promising straightline strategy to its target.

United recently entered into a joint venture with Green Plains and Tallgrass to develop and scale up an SAF technology established by Pacific Northwest National Laboratory. The joint venture, capitalizing on the four key components of feedstock, technology, infrastructure and demand, represents a first-of-its-kind business strategy in the SAF space. But it also intro- duces PNNL’s novel, shortened conversion process employing the only feedstock that can meet SAF demand: ethanol.

The Strategy

United, Green Plains and Tallgrass launched joint venture Blue Blade Energy at the end of January, with goals of developing PNNL’s technology, building a pilot plant in 2024 and then constructing a fullscale production facility by 2028. Depending on development success, Blue Blade Energy could be United’s largest supplier of SAF, with an offtake of up to 135 MMgy, up to a total of 2.7 billion gallons over 20 years.

Beyond a standard offtake agreement, Green Plains and Tallgrass envisioned a true partner that would participate in the development of the technology, not simply use the fuel. The groundbreaking PNNL technology to arrive at a drop-in renewable fuel deserves a groundbreaking business strategy.

The Technology

PNNL’s technology is novel in a variety of ways. First, the chemistry is completely new to the sector, converting ethanol to SAF via ketone intermediates.

The new catalyst converts ethanol to a carbon-oxygen molecule bond, easier to break for conversion to the final jet fuel product than the competing carbon-carbon bonds. This jump over the traditional olefin step results in a single-step conversion, eliminating one operational unit and the energy required for ethanol dehydration.

The process is exothermic versus endothermic, which saves even more energy. The robust catalyst enabling this process is highly tolerant to water and other oxygenate impurities.

Critical Mass, Policy Support

While several technologies with different feedstock requirements exist in the market today, ethanol is the only feedstock with the available production volume to help meet the scale of demand for SAF. Vegetable oils aren’t available in the enormous volumes needed. Conversely, the U.S. ethanol industry produces more than 16 billion gallons annually. It’s all about critical mass: If the goal is to make an impact on low-carbon jet fuels, it has to come through alcohol. Alcohol-to-jet is also needed to meet the White House’s SAF Grand Challenge of 3 billion gallons by 2030.

It’s certainly a new world for ethanol. SAF represents a market that actually wants to use ethanol. The industry isn’t fighting for its share of the gas tank or for access to the consumer; it’s producing for a demand base that wants it. SAF is an opportunity for the ethanol industry to be pulled through instead of pushing into the market, driven by demand. Ethanol is already renewable and most producers, including Green Plains, are looking to further reduce emissions through carbon capture and storage, as well as other endeavors. With the potential for ethanol to be a net carbon zero fuel, the opportunities in new markets are ample.

The Inflation Reduction Act of 2022 offers support for decarbonization, with the first SAF credit: $1.25-$1.75 per gallon in 2023 and 2024. In 2025, the incentive transitions into the technology-neutral Clean Fuel Production Credit—45Z—an incentive of 2 cents per gallon for each point of carbon intensity reduction below 50, and 3.5 cents per gallon for SAF.

Use of the Argonne GREET life cycle analysis model for SAF will be key, not just for ethanol, but also for vegetable oils.

Both could be precluded from the new program if GREET is not embraced. The U.S. Department of Treasury has an opportunity to fulfill the aims of Congress to rapidly decarbonize all forms of energy and transportation, including aviation. It must get it right.

Transforming Transportation

For Green Plains, the joint venture with United and Tallgrass brings full circle our transformation to a sustainable ingredient producer, filling out the fourth pillar of a focus on protein, oil, sugar and carbon. Green Plains has installed Fluid Quip Technologies’ Maximized Stillage Co-products technology in over half of our platform; is seeing increased renewable corn oil production and hitting record highs in recent quarters as a result of MSC; is building the first commercial-scale dry mill dextrose facility with FQT’s Clean Sugar Technology at our biorefinery in Shenandoah, Iowa; and now, has this joint venture to use lowcarbon ethanol, inching even lower with plans to sequester carbon, in tandem with other carbon-reduction options.

Like United, Green Plains has a goal of 100% carbon reduction by 2050, and we are fully committed to significantly lowering the carbon footprint of our ethanol to meet the sustainability needs of transportation—not just surface transportation, but aviation and marine fuel as well.

This partnership with world class organizations like United Airlines and Tallgrass, scaling up promising technology by PNNL, shows the value creation that is possible with a low-carbon biorefinery platform.

Author: Todd Becker President and CEO Green Plains Inc. Todd.becker@gpreinc.com