Boarding call for ABC 2023

The ABC 2023 event is timely as the European Parliament has just formally adopted the Renewable Energy Directive revision (RED III) and the ReFuelEU Aviation initiative with the Council left to formally approve these.

As demand for advanced biofuels for all modes of transport significantly outpaces production capacity, clarity and certainty on the regulatory framework are needed.

New greenfield plants in various stages of planning and construction will add industrial-scale capacity as they come online.

So too will the conversion and retrofitting of existing fossil assets, if investments and recent announcements made by both global oil and gas supermajors as well as national-  and independent players is anything to go by.

Retrofitting and co-processing

Preem AB, Sweden’s largest transportation fuel producer, distributor, and retailer (Study Tour option 2 at ABC 2023), is a case in point.

On paper, the rationale for investing in industrial-scale co-processing capability and/or advanced biofuel production capacity at an existing oil refinery would seem self-evident.

In reality, there are of course numerous considerations as Johanna Rindebäck, Development Engineer, New Opportunities at Preem will discuss during ABC 2023.

Preem operates two refineries, Preemraff Lysekil, and Preemraff Gothenburg respectively, both of which are undergoing significant retrofits and upgrades to produce advanced biofuels.

These include renewable diesel (aka HVO), renewable gasoline, and possibly sustainable aviation fuel (SAF), and renewable marine fuel from various feedstock including co-processed pyrolysis oil from biomass, and end-of-life tyres (ELT).

With a current capacity of 300,000 tonnes and an additional one million tonne expansion planned, Preemraff Gothenburg produces renewable diesel using feedstock such as animal fats, used cooking oil (UCO), and refined crude tall oil (CTO) – the latter is a by-product of the pulp industry.

Pending ReFuelEU Aviation

For aviation, the pending ReFuelEU Aviation rules mean that from 2025, EU airports and fuel suppliers will need to ensure that at least 2 percent of aviation fuels will SAF, with this share increasing every five years, to 6 percent in 2030, 20 percent in 2035, 34 percent in 2040, 42 percent in 2045 and 70 percent (!) in 2050.

Note that current ASTM International regulations permit up to a 50 percent blend of SAF in fossil Jet A/A-1 depending on the SAF type and production pathway, while work toward 100 percent SAF is underway.

In addition, ReFuelEU Aviation has a specific proportion of the jet fuel mix (1.2 percent in 2030, 2 percent in 2032, 5 percent in 2035 and progressively reaching 35 percent in 2050) that must comprise synthetic fuels like e-kerosene.

Make no mistake, this is a Herculean task. Without negating progress being made on hybrid-electric and battery-powered aircraft, energy-dense liquid fuels remain the option for the foreseeable future, especially for long-haul flights.

Driven by blend mandates, “moon-shot” ambitions, and public perception, global SAF production has increased remarkedly, from around 10 million litres in 2018 to over 1 billion litres by the end of 2023 according to an IEA Bioenergy report.

Recent figures from the International Air Transport Association (IATA) which represents some 300 commercial airlines comprising 83 percent of global air traffic, show that 300 million litres (240,000 tonnes) of SAF was produced in 2022.

Albeit a tripling compared to 80,000 tonnes produced in 2021, it still is just 0.1 percent of the 254 million tonnes of jet fuel burn in 2022 – military, emergency- and private aviation excluded.

According to figures from Statista, global jet fuel consumption by commercial airlines reached an all-time high of 95 billion gallons (≈360 billion litres) in 2019 only to drop to 52 billion gallons (≈197 billion litres) in 2020 on account of COVID-19. In 2021, fuel consumption reached 60 billion gallons (≈227 billion litres) and is expected to keep rising to an estimated 80 billion gallons (≈303 billion litres) in 2023.

Commercial airlines have gone from one-engine SAF test flights to investing in SAF technology start-ups, demo-plants, and first-of-its-kind commercial plants securing SAF offtakes. Refinery-scale capacity is coming onstream – both new dedicated biorefineries and retrofitted fossil production assets.

Based on current capacity and imminent SAF buildouts, IATA’s expectation is that in 2028, the overall global SAF production capacity will reach at least 69 billion litres (55 million tonnes) by 2028.

Feedstock variety and availability

An obvious issue to discuss is that of feedstock and availability, clearly illustrated by (oil) refiners’ scramble to partner with feedstock suppliers and retrofitting for multi-feedstock and co-processing capabilities like Preem.

According to the pending ReFuelEU Aviation rules, the term ‘sustainable aviation fuel’ will include synthetic fuels, certain biofuels produced from agricultural or forestry residues, algae, bio-waste, used cooking oil (UCO), or certain animal fats.

Jet fuels produced from waste gases and waste plastic (seemingly source agnostic in terms of fossil or biogenic) are also considered by MEPs as ‘green’, while “feed and food crop-based fuels” and fuels derived from palm- and soybean materials will not be classified as green as, according to MEPs, they do not meet the sustainability criteria.

What these exceptions will mean for sourcing SAF from a European airline operator perspective remains to be seen, as these are feedstocks eligible for use in Asia, North- and South America where the lion’s share of near-term SAF and/or HVO capacity buildout is taking place.

Perhaps Isabelle Nordin, Sustainability Project Leader, SAS – Scandinavian Airlines will offer up some insights and considerations at ABC 2023.

Like other airlines, SAS has signed SAF offtake deals, amongst others with Gevo Inc. which is building an ethanol-to-jet SAF facility in South Dakota (SD).

The crux from a ReFuelEU Aviation perspective is that the ethanol feedstock to be used will be corn-based.

ASTM International pathways

Part of the reason for the seeming reliance on virgin- and used cooking oils (UCO), animal fats, oils, and greases (FOG) is that both the current and vast majority of the expected SAF volumes over the next five years will be derived from just one of the nine production pathways that are currently ASTM International certified – hydroprocessed esters and fatty acid (HEFA).

This is a crunch point, as these feedstocks are also used to produce biodiesel and renewable diesel (HVO). Thus, while mature, the HEFA pathway would seem the least scalable for future SAF needs as both IEA Bioenergy and IATA point out.

Therefore, it will be of equal interest to hear what multinational SAF producers say. For instance, how does oil refiner and renewable products major Neste Oyj handle the (EU) HEFA feedstock/SAF conundrum given that Neste is currently the world’s largest renewable diesel/SAF producer with retrofitted refineries and dedicated biorefineries in three geographies – Europe (Finland, and the Netherlands), North America (California, US), and Asia (Singapore). Jan-Erik Nordström, Business Development Manager, Neste is the person to parley with during ABC 2023.

Other ASTM International-approved pathways include the use of various alcohols as feedstock – Methanol-to-Jet (MtJ), Ethanol-to-Jet (EtJ), and Alcohol-to-Jet (AtJ).

Alcohols are perhaps the world’s most widely available and traded chemicals and are already used in the transportation fuel pool as octane boosters in gasoline (MTBE, ETBE), M20, M100, E10, E15, E20, E85, ED95, and so on.

Furthermore, they can be fermented, derived, or synthesized from a variety of biomass- and (renewable) feedstock of non-biological origin (RFNBO) such as industrial waste gases.

Indeed, industrial-scale lignocellulosic ethanol production capability has been around for the best part of a century, which may come as a surprise to some. Borregaard, Europe’s longstanding lignocellulosic ethanol producer, has been producing lignocellulosic ethanol as a by-product from its cellulose production for over fifty years now – about 20 million litres annually.

Which other ASTM-approved production pathways are available now and in the near future? What potential do these have to contribute to an estimated 150 billion litre per annum neat SAF demand?

Dr Jack Saddler, Professor of Biofuels/Bioenergy and Dean Emeritus at the University of British Columbia (UBC) is the man to listen to. One of the co-authors of the said IEA Bioenergy Task 39 report, Dr Saddler will discuss “progress in the commercialization of biojet/SAF” technologies, potential, and challenges at ABC 2023.

Methanol is a mover for shipping

Every year, some  100,000 vessels powered by 300 million tonnes of fossil fuel move 11 billion tonnes of goods around the world. Shipping is accountable for around 1,076 million tonnes of CO₂ emissions annually – around 3 percent of global GHG emissions.

Earlier this year, the International Maritime Organization (IMO) adopted the 2023 IMO Strategy on Reduction of GHG Emissions from Ships, with enhanced targets to tackle harmful emissions.

The revised IMO GHG Strategy includes an enhanced common ambition to reach net-zero GHG emissions from international shipping close to 2050, a commitment to ensure uptake of alternative zero and near-zero GHG fuels by 2030, as well as indicative check-points for 2030 and 2040.

While liquefied natural gas (LNG) has emerged as the main lower-carbon alternative fuel with almost 6 percent of the world fleet by gross tonnage, methanol is fast developing fuel of choice as dual-fuel engine capabilities are now available for retrofits and newbuilds from marine powertrain providers such as MAN and Wärtsilä.

Shipping majors such as Sweden’s Stena Group, and Denmark’s A.P. Moller-Maersk are two firms pioneering methanol as a marine fuel, the former with “Stena Germanica“, the world’s first retrofitted Ro-Pax ferry, and the latter with the just named “Laura Mærsk” – the world’s first methanol-enabled container vessel.

According to a new report from DNV, the number of methanol-fuelled vessels is expected to exceed 200 by 2028, up from 30 this year.

In tandem, bunkering infrastructure is also being developed. As multi-modal intersection points, ports play a key role. Not least as energy transition enablers by providing renewable fuel options, bunkering infrastructure, and other services as ship owners, fleet operators, and freight clients seek to cut GHG emissions.

The Port of Gothenburg, the largest port in the Nordics, is a pioneer in this respect having paved the way for bunkering of liquefied natural gas (LNG) and bioLNG as well as methanol.

The latter the Port has handled since 2015 when ferry operator Stena Line started truck-to-ship bunkering of Stena Germanica, and more recently, completed the world’s first non-tanker ship-to-ship methanol bunkering at the Port.

Collaboration across the transport value chain is crucial to speed up the transition to fossil-free fuels, and a consortium with Scania and Volvo Group, along with Stena Line, and the Port of Gothenburg launched the ”Tranzero Initiative”.

With around one million truck transports annually, Tranzero Initiative seeks to reduce carbon emissions linked to the Port by 70 percent by 2030 as Therese Jällbrink, Head of Renewable Energy at the Port of Gothenburg will discuss.

Scaling green methanol production

The simplest of the alcohols, methanol (CH₃OH) is also a fundamental building block for thousands of everyday products and is increasingly being used as a fuel not least for transportation.

According to figures from the Methanol Institute (MI), the global trade association for the methanol industry, global methanol production surpassed 106 million tonnes in 2022, of which close to 18 million tonnes was used in alternative fuel applications including M100, gasoline blending (MTBE, M30, etc), biodiesel production, DME, and fuel cells.

However, renewable- and e-methanol still represent less than 1 million tonnes of a total 171 million tonnes installed capacity but is scaling rapidly – projected to reach 8 million tonnes by 2027 according to MI.

One such e-methanol plant is currently being built at a biomass-fired combined heat and power (CHP) plant in northeast Sweden – FlagshipONE. Another renewable methanol source being commercialized can be found in the pulp and paper industry.

Globally, kraft pulping is the most common form of chemical pulping for wood and is a process designed to recover the cooking chemicals and heat.

Roughly half of the initial pulpwood material is dissolved in the black liquor, and it is from this that various components and biochemicals such as tall oil and methanol can be extracted prior to the combustion of black liquor in a recovery boiler for heat and power.

Thus, having energy-efficient pulping processes enables the recovery of tall oil and methanol from black liquor – the power of supplementing existing efforts toward net zero emissions as Henrik Brodin, Head of Energy Transition at Södra might say.

The Swedish forest owner’s association Södra was the first to deploy a commercial-scale methanol recovery unit at its Södra Cell Mönsterås pulpmill – others have since followed suit.

Incidentally, the tall oil from Södra’s pulp mills is processed into a refinery-ready feedstock at SunPine’s facility in Piteå before co-processing at Preem, whereas the biomethanol displaces fossil methanol in biodiesel production.

The company is also a partner in Silva Green Fuel, a joint venture with Statkraft to demonstrate renewable diesel production from logging residues.

Plugging technology portfolio gaps

Finally, irrespective of the advanced biofuel to be produced, almost all technology developers share a common dilemma when moving from demonstration to full commercialization – technology readiness level (TRL) 7 and above.

Few developers have or have access to in-house designing, engineering, building, and commissioning capabilities or capacities, physical or fiscal.

The same goes for many of the presumptive clients, that may or may not be prepared to shoulder the technology deployment risk despite market demand for the product.

At the same time, companies with the design, engineering, procurement, and construction capacities needed might be finding themselves late in the game viz-a-viz colleagues to develop technology internally.

Indeed, judging from the number of announcements in recent years, it would seem that joint ventures, strategic partnerships, and technology licensing have become a way fast-forward. Along with acquisitions, strategic alliances, and licensing plug any gaps in “renewable” technology portfolios.

This is of course nothing new but it does suggest that the capacity buildout of various advanced biofuels, such as electro-methanol (eMethanol) for biochemicals and shipping or alcohol-to-jet (AtJ) for aviation, are just around the corner.

How close is a question for Yawar Naqvi, Business Developer for PureSAF at global science, technology, and engineering major KBR, Inc.

KBR is involved in several advanced biofuel projects, not least here in the Nordics. More recently, KBR has entered into a strategic alliance with Swedish Biofuels, developers of the “PureSAF” alcohols-to-jet pathway, a multi-feedstock pathway approved by ASTM International that paves the way for 100 percent SAF certification.

These are just some of the speakers and topics that will be discussed at the upcoming Advanced Biofuels Conference in Gothenburg in which registration for online participation is still an option a few days more.