The ethanol industry is growing and innovating, with new opportunities ahead. Emily Skor, CEO of Growth Energy, says the ethanol industry is looking at sustainable aviation fuel as one of the biggest new opportunities for the bioeconomy.
Skor says, “It’s amazing how much the conversation is focused on our ability to compete in a low-carbon economy, and that’s how I would sum it up. So, we’re still talking about higher blends of E15. We’re still talking about the Renewable Fuel Standard. But there’s this whole new conversation now about what we do with our carbon. Do we capture it and utilize it? Do we sequester it to reduce the carbon intensity? Ethanol is the feedstock for sustainable aviation fuel. That’s something we weren’t talking about three or four years ago. There’s an opportunity that’s been opened up with some new tax credits we were able to secure, so now we want to leverage that and, okay, there’s some new markets on the table for ethanol. Let’s just run towards it.”
Sustainable aviation fuel represents a tremendous increase in demand for corn as a feedstock. Skor says, “The real new thing is the opportunity – and we’re not there yet, so we’re still a couple of years away – but if ethanol is a feedstock for sustainable aviation fuel, let me throw it a couple of numbers at you. Last year, we produced 16 million gallons of sustainable aviation fuel. The administration’s goal is three billion gallons by 2030. Now, because jet fuel is so energy dense – you need 1.6 gallons of ethanol to make one gallon of sustainable aviation fuel – that’s great for demand. So, we’ve got the potential, there are billions of gallons of potential in the next seven to 10 years out there if we get the policies right, and we can build this out at commercial scale.”
One advantage is demand for the product is already in place. Skor says, “The major U.S. airlines, they’ve all made commitments that they want to decarbonize. You’re not going to put a battery in an airplane anytime soon, so it’s a great opportunity for biofuels. And so, this is a situation where the customer already wants the product. All of our customers have said yes, we want low-carbon jet fuel, and biofuels is one of the ways that you can do that in volume, in the volume necessary to meet their goals.”
Getting the pieces in place to develop the industry is a work in progress.
Skor says, “We’re getting there. So, we’ve got the tax credits, but like any law, Congress did its job, and now it’s the Treasury and IRS, and they’ve got to implement this and put out the regulations for the tax code that reflect all the innovations. And so, it’s very granular in this area. Ethanol, if you do this, you get a reduction of five points in your carbon intensity, or 10 points, or 20 points. So, they’ve got to allow for us to do all that optimization to get our carbon intensity low enough that we’re considered sustainable aviation fuel.”