Tue 18 Aug 2009 – The Air Transport Association of America (ATA) has announced a deal in which eight of its leading airline members will purchase up to 1.5 million gallons of renewable synthetic diesel fuel for use in ground service equipment and vehicles at Los Angeles International Airport (LAX) beginning in late 2012. The agreement was signed with synthetic fuel specialist Rentech and Aircraft Service International Group (ASIG), a global provider to airlines and airports of ground, fuel, cargo and airport facility services. The renewable fuel, called RenDiesel, will be produced at the commercial-scale facility that Rentech is developing in Rialto, California, primarily from woody green waste such as grass clippings.
The initial purchasers of the fuel are Alaska Airlines, American Airlines, Continental Airlines, Delta Air Lines, Southwest Airlines, United Airlines, UPS Airlines and US Airways. ATA is hopeful of adding other airline partners in due course.
The fuel is expected to have a low carbon footprint and minimal particulate and other emissions, says ATA, while meeting or exceeding all applicable fuel standards. ASIG, which provides refuelling services to many airlines operating at LAX, will handle receipt and dispensing of the RenDiesel.
The airlines declined to reveal further details of the contract such as the price per gallon they were expecting to pay for the synthetic fuel and whether it would be cheaper or more expensive than the conventional fuel it was replacing.
“We are proud to take part in this innovative, collective endeavour that over time, will further reduce greenhouse gas emissions and improve local air quality through the use of greener fuels,” said Glenn Tilton, ATA Board Chairman and UAL Corporation Chairman, President and CEO. “This transaction promises to be the first of many such green fuel purchase agreements by the commercial aviation industry. It exemplifies the ongoing commitment of airlines and energy suppliers to diversify our fuel sources while contributing to a cleaner environment and adding new jobs to the economy.”
Gina Marie Lindsey, Executive Director of Los Angeles World Airports (LAWA), said: “This collaborative effort is yet another environmentally friendly initiative that we and the airlines are pursuing at Los Angeles-area airports. It shows what we can accomplish by working together towards a common and necessary goal.”
Rentech’s biomass gasification process can convert multiple biomass feedstocks into synthesis gas (syngas) for the production of renewable fuels and power. Combining the gasification process with the application of Rentech’s syngas conditioning and cleanup technology, together with its patented Rentech Process based on Fischer-Tropsch chemistry, the company offers an integrated solution for the production of synthetic fuels from biomass.
According to the company, the Rentech Process can also convert syngas from fossil resources into “ultraclean” synthetic jet and diesel fuels. Final product upgrading is provided under an alliance with Honeywell’s UOP, which refined the jet biofuels for the Air New Zealand, Continental and Japan Airlines test flights. Rentech develops projects and licenses these technologies for application in synthetic fuels and power facilities worldwide.
“The low-emissions profile and near-zero carbon footprint of our renewable RenDiesel will guarantee that the LAX ground service vehicles using this fuel will be among the cleanest and greenest of their kind,” said D. Hunt Ramsbottom, Rentech’s President and CEO. “We expect this agreement to serve as a model for future supply relationships at other airports and for other fuels, including Rentech’s synthetic jet fuel, which was recently approved for commercial airline use.”
Ramsbottom was referring to last week’s full approval by standards body ASTM International of the use of commercial and military blended synthetic jet fuels (see story).
In a BNET article last month, Ramsbottom stated that meeting California’s own renewable targets would require the blending in of 75,000 to 100,000 barrels a day of renewable fuel. “It will be a big market,” he said. “We will need to do 100 Rialto-sized plants to have one percent of the market for biomass. And keep in mind that a single [major] domestic airline uses 2.5 billion gallons of jet fuel per year. The challenge is getting to scale.”
Last week, Rentech announced its first-ever profitable quarter, with a net income of $36.1 million compared to a net loss of $7.8 million in the same period last year. The company reported revenues of $91.4 million for the third quarter of fiscal year 2009, up from $60.4 million for the comparable quarter in the prior year.
Still in California, Congressman Edward Markey, co-sponsor of the Waxman-Markey climate bill, visited Aurora Biofuels’ labs last weekend, where the start-up is using biotechnology to create algae strains. He told reporters his legislation, if passed, would “unleash more than a trillion dollars’ worth of private sector investment,” which he said would create an opportunity for entrepreneurs to once again transform the world in much the same way that entrepreneurs did for the information technology boom (see Reuters story).
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