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United Airlines chief calls for more investment in developing the alternative jet fuels market

United Airlines chief calls for more investment in developing the alternative jet fuels market | CAAFI, ATA, United Airlines, Airbus

Glenn Tilton, Chairman and CEO, United Airlines

Mon 5 Oct 2009 – Glenn Tilton, Chairman of both United Airlines and the Air Transport Association of America, called on government, investors and producers to seize the opportunity to provide the airline industry with alternative fuels. Speaking at the annual meeting of the Commercial Aviation Alternative Fuels (CAAFI), he said the cash-strapped sector cannot provide the capital required but it was committed to supporting and seeking sustained funding for the development of aviation biofuels. He said airlines needed alternative jet fuels to help limit price volatility through competition with petroleum-based fuels, increase security of supply and reduce environmental impact.

Tilton said airlines were committed to seeing the recently approved fuel specification, the first for 20 years, for synthetic kerosene expanded to a full range of feedstocks and processes. He said the industry was actively seeking funding for this work but it needed commitment from government, which had a critical role to play, and private investment to get to full scale commercial deployment.
“It is by no means clear that emerging alternative jet fuel producers can get the funding they need for constructing facilities, growing or extracting alternative feedstocks on a commercial scale and making the business financially competitive,” he said.
“While the airlines have the need and every interest in the alternative jet fuel market succeeding, we are a cash-strapped industry – we do not have the cash or credit capacity to fund the infrastructure for this. As many in our industry have discussed, our industry has systemically failed to earn its cost of capital.”
H e said the Government, instead of focusing on “punitive” economic measures to address climate change, “should be working with aviation to invest in the very things, such as alternative fuels, that will dramatically reduce our emissions.”
Government loans and guarantees to mitigate the risks of potential investors were absolutely essential, he said, as there was nervousness in the markets of committing capital to alternative fuel development because of oil price volatility.
“Another key point is that government should not micromanage or mandate choice of feedstocks or technology,” warned Tilton. “As an industry, we are open to the type of jet fuel alternative. We are promoting innovation and competition among all alternatives. We are interested in partnering towards an outcome that provides a safe, environmentally-friendly, reliable and economically feasible alternative.
“The airlines are not asking the government to do it for us. We are asking them to do it with us. I have given many examples of how the airlines are taking responsibility for our own destiny – we’re putting in intellectual capital and resources so investment in aviation alternative fuels will bear real fruit – we’re ploughing the field.
“Investors should seize this opportunity. We need leadership from government to make the needed investment attractive.”
Randy Babbitt, Administrator of the Federal Aviation Administration (FAA) said aviation was once again spearheading part of a fundamental change in how we live, this time towards the use of low-carbon energy.
“When you compare today to the year 2000, US commercial aviation is moving 12% more passengers and 22% more freight while burning less fuel, reducing our carbon output by one million tons over nine years,” he told delegates.
He commended CAAFI on its work that recently resulted in the approval of the ASTM D7566 synthetic jet fuel blend specification.
“CAAFI also brought together airlines and fuel producers to clarify needs and requirements around the table,” he added. “As a result, renewable diesel will be used by some ground service equipment at Los Angeles International Airport. Other airports are converting their ground vehicles to low emission fuels, with funding assistance from FAA’s Voluntary Airport Low Emission Program.”
Away from the meeting, Airbus has also welcomed the new ASTM fuel standard under which 50% of conventional jet fuel can be blended with synthetic fuels made from biomass, natural gas or coal, the aircraft manufacturer describes as xTL fuels.
“This breakthrough paves the way for a 100% xTL blend made entirely from bio feedstock, such as woodchip waste,” said Christian Dumas, Airbus Vice President, Sustainable Development and Eco-Efficiency. “This new specification is a major step towards reducing aviation’s environmental footprint and represents a significant achievement along the Airbus alternative fuels roadmap.”
The Airbus roadmap estimates that some 30% of jet fuel used in 2030 could be sustainable biojet fuel if maturity of alternative high yield non-feedstock occurs in the middle of the next decade.

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