Airlines biofuel tests stalled by high prices

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Graphic: Scott Bell; Source: oilalgae.com, MCT Photo Service

More and more airlines focusing on fuel efficiency are starting to use alternative jet fuels to keep costs down and help the environment in recent years. With the price of fuel rising and the pressure to reduce fuel emissions increasing, there is a big increase on pressure by the airline industry to develop bio-fuels that are efficient and help reduce their carbon footprint.

Cash-strapped airlines are diving into the bio-fuel market, eager to fly on fuel that can reduce carbon emissions up to 80% while diversifying the supply of their biggest expense. The industry has pledged to stop increasing its carbon emissions by 2020 even as global air travel increases, and to halve its carbon dioxide emissions to its 2005 levels by 2050.

Over the past three years the airline industry has conducted several trials and is shifting into a new gear, starting to conduct regular commercial flights that rely partly on bio-fuels. Its crucial for the bio-fuels industry to get this kind of support, because air travel is only growing so is the pressure to become energy independent and reduce greenhouse gas emissions.

This week, two US airlines will be flying passengers on flights powered by bio-fuels for the first time. On Monday, a Continental Airlines flight from Houston to Chicago used a bio-fuel blend made partly from algae, and Alaska Airlines flew passengers Wednesday using a fuel partly from cooking oil.

Bill Glover, Boeing’s strategist for environmental policy, says different airlines have different ways of reducing air pollution they create. But before they can do that most effectively, the industry has to build a whole new supply chain for bio-fuels.

“It’s going to take a little while to get the infrastructure in place, get the volume and get some of the economics a little more favourable,” Glover said. “But our near-term target is 1 percent of all the aviation fuel have some bio-content by 2015.”

But the shift is not without its challenges. One of the things slowing that drive is the price. Bio-fuel costs way much than the conventional jet fuel. And the companies are only willing to absorb the cost of a small number of demonstration flights.

“Bio-fuels could break the tyranny of oil and lift millions from poverty along with providing a sustainable fuel source for aviation,” Giovanni Bisignani, director general of the International Air Transport Association said.

IATA estimates that replacing 3 percent of the kerosene in jet fuel would reduce aviation CO2 emissions by over 10 million tons, at an initial cost of $10 to $15 billion in production and distribution facilities.

Bio-fuels are seen as the major contributor to achieving this target. The global aviation association also predicted that bio-fuels could replace 6 percent of kerosene in the airline industry by 2020.

But supply availability and cost – bio-fuel is more than double the price of regular aviation fuel – are now the main impediments to its wider use.

Green fuel is only good if it can meet price expectations, because the willingness of the industry to pay a premium for something green and renewable is limited.

Sources NY Times, WSJ and bullfax.com

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