Green Plains CEO Says SAF Production Targets Impossible Without Ethanol — OPIS

MINNEAPOLIS--It will be "literally impossible" for sustainable aviation fuel makers to meet the Biden administration's ambitious SAF Grand Challenge production targets without relying heavily on corn-based alcohol as a feedstock, Todd Becker, president and chief executive officer of Omaha-based biofuels producer Green Plains Inc., said here Tuesday morning at the first annual North American SAF Conference & Expo.

"Three billion gallons by 2030 and 100% [SAF usage] by 2050 -- to realize that success, it has to be done with alcohol," Becker said during his keynote presentation.

He said ethanol producers have a "unique opportunity" because there is already a large supply of alcohol ready to devote to SAF production. "The U.S. soy protein industry produces a lot [of feedstock]," Becker added, "but it's really relative to what we can produce in ethanol."

Other speakers Tuesday morning agreed that the alcohol-to-jet production pathway will be essential and said lawmakers need to refine policies to further incentivize ethanol producers and farmers looking to lower the carbon-intensity scores of their products.

For months, biofuels industry stakeholders have urged the U.S. Treasury to use (and also to update) the Department of Energy's lifecycle carbon assessment model when assessing fuels for the minimum $1.25/gal SAF tax credit included in last year's Inflation Reduction Act.

The government has said it would rely on the International Civil Aviation Organization's LCA model or "any similar methodology" in administering the tax credit scheme.

"Both models have their advantages, and I think both models are right for their areas," Jennifer Aurandt-Pilgrim, director of innovation and market development for Illinois-based ethanol producer Marquis Energy, said during a presentation Tuesday morning.

"We've just got to make sure that both models use the most up-to-date science and the most up-to-date information," she added. "[LCA] models are scientific things made up in the laboratory. Let's use the correct data to make these models and roll out a model that everybody can use."

ICAO's model "would preclude some vegetable oils from being used as feedstock, which is crazy in itself, as well as potentially corn-based ethanol," Becker said. And without corn-based alcohol, he warned, "[SAF production] will be a niche, and it won't go any further than that."

"The farmers are going to be a key part of this," said Neal Jakel, vice president of strategy and technology for Fluid Quip Technologies. "They're the ones that are going to help drive this. We need to help them figure out what is the right pathway, what is the right opportunity."

But Jakel cast a concerned eye over the alcohol-to-SAF technology landscape.

"Back in like 2004 or 2005, in the heyday of ethanol, there were hundreds of hundreds and hundreds of technology providers selling every snake-oil gadget out there," Jakel said onstage. "I'm worried that we're going to get back to that place. Make sure you're hiring someone to understand those technologies and really vet them out properly, because what we don't want to do is have a bunch of failures. We want this to be successful, and we want this to roll out as quickly as possible."

Becker said the ethanol industry is standing at a crossroads, with a chance to redefine itself.

"We fought our way into the fuel tank," he said. "When we produced ethanol as a motor fuel, we fought our way in. We literally had to fight for the consumer because we didn't own the distribution."

The difference this time, Becker said, is that the airlines are telling ethanol producers, "Produce this fuel. We want to use it. If you produce it, we'll buy it. Get the right policy in place, get the right economics in place, and we'll buy it, because our customers want us to decarbonize."

This content was created by Oil Price Information Service, which is operated by Dow Jones & Co. OPIS is run independently from Dow Jones Newswires and The Wall Street Journal.

Reporting by Aaron Alford, aalford@opisnet.com; Editing by Jordan Godwin, jgodwin@opisnet.com

(END) Dow Jones Newswires

August 29, 2023 16:12 ET (20:12 GMT)

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