Australian biofuel developer sees threat to aviation supply

BioJet is currently one of only a small number of companies that has viable second-generation biofuel technology ready to be commercialised in Australia.

The technology is based on the gasification of municipal solid waste with a recently developed bi-metal catalyst

The company is planning to build a A$17.5 million pilot plant to allow it to scale up the technology ahead of an IPO  to build the first full-scale production module with a minimum annual capacity of 55 million litres (though expected annual production capacity will be closer to 75 million litres).

The pilot plant will have an indirect heat gasifier using steam to fluidise the biomass at approximately 850 degrees Celsius and 100 psi. The gasifier will be designed in the US but fabricated in Australia.

The plan is to subsequently modify the process to produce bio-SPK (Synthetic Paraffinic Kerosene) that can meet the ASTM D7566 standard for aviation use.

But BioJet is highlighting an issue that could prove to be a major stumbling block in the supply of viable commercial stocks of biofuel for aviation.

BioJet’s Paul Bredereck says that, “The challenge will be cost, because although we know that we can produce bio-SPK that can compete with Jet A1, we can make a higher profit margin producing automotive blends.”

Bredereck points out that the airline industry not only needs competitive pricing of biofuels, it also needs security of supply.

“For companies like ours that are early stage scale up our challenge is neither technology, nor cost, nor markets (once we get to scale). Our challenge is investment and where to make this investment.

“Do we invest in ethanol, green diesel or bio jet fuel? We won’t have the capital to invest in all three, so our investment decisions will be based on highest margin, time to market and the priority of our early stage investors.

“And in all of these scenarios aviation loses. The problem for aviation is that investment decisions made today will control feed stocks into the next two decades.

“So unless airlines adopt a biofuel producer at an early stage they will not be early followers because they will not have supply in commercial quantities.”

Bredereck urges industry groups to pressure governments and end users to create greater awareness of the need for investment.