Norwegian aviation industry sees potential in local production of sustainable jet fuels from forest biomass
(photo: Viken Skog)
Tue 7 May 2013 – A report commissioned by Norwegian airport operator Avinor, along with airlines SAS and Norwegian, and the Federation of Norwegian Aviation Industries, concludes that cost-competitive, large-scale production of sustainable aviation biofuels could be viable in the country between 2020 and 2025. The assessment of land-based and marine feedstock in Norway shows that forest biomass is the most important feedstock on a near-term basis, with micro and macroalgae resources most probably not available in large volumes before 2025. The report, conducted by Rambøll, considers two processes most suitable within the timeframe for a Norwegian value chain: Fischer-Tropsch (FT) thermochemical processing and gasification of forest biomass, and the refining of bio-alcohols to Jet A-1 fuel (ATJ).
To reach the Norwegian aviation industry’s own 10-15% GHG-reduction targets by 2020-25, 190-250 million litres of renewable Jet A-1 are needed, an amount equal to biomass with an energy content of 6-8 TWh. Norwegian timber harvesting volumes towards 2020-25 will most likely remain on today’s level, with a 7 TWh increased harvesting potential, mainly from logging residues. If all of this should be processed, says the report, an amount of 230 million litres of Jet A-1 could be produced, depending on the processing technology utilised.
To produce this amount it would require around 8-10 production plants with an output of 50 million litres each, or fewer if larger ones employed. A feasibility study for suitable plant locations has been performed including the cost of logistics.
The price of FT-based Jet A-1 can be competitive with conventional Jet A-1 by 2025, finds independent consultancy Rambøll, provided there is crucial sales income from biodiesel and bionaphtha byproducts. The estimated production costs in 2012 are 11 NOK/litre ($1.89/litre) for renewable Jet A-1, which is 5 NOK/litre ($0.86) higher than the present market price for fossil Jet A-1. The production cost is estimated to be 7 NOK/litre ($1.20) in 2025, broadly comparable with fossil Jet A-1 market forecasts. The income from the byproducts is estimated at 141 million NOK ($24.2m), based on today’s prices, which results in the lower production costs.
Given the economic and technological uncertainty related to sustainable biofuel production, cautions the report, it is necessary to carry out further calculations to estimate the profitability more precisely for a specific production plant.
ATJ, yet to be certified from commercial aviation use, is seen as a more expensive fuel, with current production costs around 27 NOK/litre, and Rambøll says there is not sufficient information about the quantities of byproducts from the process to estimate their sales income. Due to the immature technology and limited available process data, the level of uncertainty is high.
Life-cycle assessments have been calculated on both processes and Rambøll’s results conclude with an 81% climate reduction with FT fuels, compared to a 65% reduction from ATJ fuels, both within the EU 60% reduction sustainability criteria from new biofuel production plants after 2017.
“The technology and resources are available and flights using biofuel as an additive are commonplace, but there are still a number of problems related to production costs and climate impact which have to be resolved,” said Avinor CEO Dag Falk-Petersen. “Even so, the potential for biofuel production from Norwegian forests is so big that Avinor wants to play an active role in finding effective, sustainable solutions.”
Avinor said it was prepared to invest up to NOK 100 million ($17m) over a 10-year period into various projects and studies to help realise biofuel production. It has just signed a Letter of Intent with Viken Skog, a cooperative of Norwegian forest owners, to invest in an innovation centre that is tasked with looking into biofuel production opportunities.
The airport operator said it also envisages a number of incentives for airlines, including discounts, for airlines that want to start using biofuels.
“We have been in dialogue with a number of suppliers since the early 2000s and taken part in a large number of initiatives,” said Rickard Gustafson, CEO at SAS. “We are ready to use biofuels but the price has to be commercially acceptable and sustainability criteria have to be met so that we can reduce the overall GHG emissions of the air travel industry significantly.”
Norwegian CEO Bjørn Kjos said: “The most important thing airlines can do to reduce emissions is to invest in more environmentally-friendly aircraft and to fill our tanks with biofuels. The problem at this time is that biofuel is difficult to get and very expensive. That means the industry’s biggest challenge is to find sustainable, cost-effective solutions which make environmentally-friendly fuels a viable alternative to fossil fuels.”
The Federation of Norwegian Aviation Industries (NHO Luftfart) stressed other sources of influence were needed to realise biofuel opportunities. “The Norwegian air travel industry needs to encourage industry and the authorities to help with the pioneering work needed to reduce GHG emissions from air travel,” said Torbjørn Lothe. “The airlines also want long-term deals for the purchase of biofuels if the price is competitive. Together, such factors open up major industrial opportunities for the Norwegian forestry industry.”