ADM sees its sustainable aviation fuel coming online by 2026
(Reuters) - Global grain merchant Archer Daniels Midland Co sees the commercialization of its SAF efforts coming online around 2026, Chief Financial Officer Vikram Luthar said on Monday.
"SAF in terms of reality to come online, at least for us, is going to be in the 2026 type of time frame," said Luthar, speaking at the BMO Capital Markets 2022 Growth & ESG Conference.
He said investment in the SAF sector will be needed to help commercialize sustainable jet fuel but such investment would not necessarily come from ADM.
In an effort to fight climate change, the Biden administration has launched a government challenge to supply at least 3 billion gallons of SAF per year by 2030. The airline sector is considered one of the most difficult to decarbonize as fuel for flights cannot be easily replaced with other kinds of power.
The biofuel industry got a boost this year from passage of the Inflation Reduction Act, which provides significant subsidies to the biodiesel and sustainable jet fuel industries in the form of tax credits.
"We believe there's enough economic incentive for SAF to be profitable and to be a viable blend for jet fuel," he said, adding that in some circumstances, "we believe there is some profitability already in SAF."
Luthar also said the U.S. Environmental Protection Agency's proposal of renewable volume obligations is a positive move for the biofuel industry that "establishes a floor, not a ceiling for demand going forward."
The proposal marks the latest chapter for the more than decade-old Renewable Fuel Standard (RFS), under which oil refiners are required to blend billions of gallons of biofuels into the nation's fuel mix or buy tradable credits from those that do.
"There's an opportunity to convert 900 million gallons of our ethanol into about 500 million gallons of SAF," Luthar said, noting that the federal Inflation Reduction Act will likely accelerate and expand investment in the sector.
Read more:
TotalEnergies and Air France KLM agree sustainable jet fuel deal
Ryanair to buy sustainable fuel from Shell but 2030 target elusive
(Reporting by P.J. Huffstutter in Chicago; Additional reporting by Stephanie Kelly and Jarrett Renshaw; Editing by Lisa Shumaker)
Related News
- John Cockerill, Johnson Matthey and ETFuels partner for 120,000-tpy Texas (U.S.) e-methanol project
- Digital Exclusive (sponsored): NXRe™: A novel recycling technology to support the plastics industry in creating efficient and effective circular value chains
- Portugal's Galp plans to start producing biofuels in 2026
- Dow Chemical, Innventure to collaborate on waste-to-value platform
- Technip Energies, LanzaTech awarded U.S. DOE funding for breakthrough CO2-to-ethylene technology
- Verde Clean Fuels receives $50-MM investment from Cottonmouth Ventures for the potential development of GTG plants in the Permian Basin (U.S.)
Comments