Csonka-aners2017 (1).pdf

The “real potential” of technologies under development

Sustainable Alternative Jet Fuel Aircraft Noise and Emissions Reduction Symposium (ANERS) 20-21 April 2017 Alexandria, Virginia Steve Csonka Executive Director, CAAFI

First flight from continuous commercial production of SAJF, 10Mar’16. Fuel from AltAir Fuels, Paramount, CA (HEFA-SPK 30/70 Blend) Now being delivered to LAX fuel farm for everyone’s upload

21Apr’17

Com’l Aviation’s CO2 commitments To decouple carbon growth from demand growth

1.5% annual fuel efficiency improvements

CNG 2020

These 3 commitments currently being promulgated into Int’l Regulation through an ICAO/CAEP “basket of measures”: ∗ CO2 Standards ∗ CORSIA: MBMs

∗ “Gap filler” to CNG 2020 ∗ Will facilitate SAJF ∗ Will monetize carbon

Similar commitment from BizAv & DOD

3 May 2017

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Overall industry summary:

Sustainable Alternative Jet Fuel (SAJF) activity ∗ SAJF are key for meeting industry’s commitments

∗ Aviation enterprise aligned; SAJF delivers multiple benefits, including net GHG reductions of from 50-100% (some carbon-negative) ∗ Segment knows how to make it; Activities from FRL 1 to 9 ∗ Significant work on pilot, demo, and commercial production ∗ Commercial agreements inked, more being pursued ∗ Pathway identified for fully synthetic (50% max blend today)

∗ Making progress, but still significant challenges – only modest production – focus on enabling commercial viability ∗ CAAFI originally put in place to work a full range of Public-Private Partnership activities to break down barriers and lower risk: foster, catalyze, enable, facilitate, participate

∗ Potential for acceleration a function of many elements ∗ External: Policy, oil price, public pressure, transport paradigm changes ∗ Internal: Risk mitigation, engagement & success replication 3 May 2017

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SAJF Sustainable Alternative Jet Fuel

a.k.a. aviation biofuel, biojet, alternative aviation fuel Alternative: Creating synthetic jet fuel by starting with a different set of

hydrocarbons than petroleum … a synthetic comprised of molecules essentially identical to petroleum-based jet (in whole or in part) – enables drop-in approach – no changes to infrastructure or equipment, no recertification, …

Sustainable: Doing so while taking Social, Economic, and Environmental progress into account

Jet Fuel: Delivering the properties of ASTM D1655 – pure hydrocarbons Net LCA GHG reduction: Benefit comes from leaving carbon molecules in the ground; Instead, utilizing the carbon already in the biosphere via recycling or dual use

3 May 2017

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Jet Fuel / Kerosene

Aviation Enterprise optimized around the fuel A middle distillate kerosene stream is used for aviation fuel ∗ Comprised of mixtures of aliphatic and aromatic hydrocarbons with carbon numbers predominantly in the range of C8-C16, which is typically a mixture of: 25% / 11% normal / branched paraffins 30% / 12% / 1% mono- / di- / tri-cycloparraffins 16 / 5% mono- / di-nuclear aromatics (25% max aromatics – air quality concern)

There is no standard “formula” for Jet Fuel ∗ Composition that delivers the physical properties and performancebased requirements / characteristics of ASTM D1655 specification ∗ A Gaussian distribution of hydrocarbons, represented as C12H23

Creating synthetic jet fuel ∗ In order to maintain the aircraft / engine certification basis, we need:

∗ Set of molecules / chemicals that are essentially identical to those found in jet ∗ Don’t allow the overall distribution of molecules to move the aggregate fuel properties outside the physical and fit-forpurpose constraints of D1655

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SAJF conversion processes

…or, “dispelling the fear of revisiting Chemistry 101”

Start with hydrocarbon / organic building-blocks Deconstruct & remove extraneous molecules Process to workable intermediates Reformulate to appropriate C8-C16 molecules Utilize standard refinery “finishing” processes D7566 - SAJF Blending Components D1655 – from petroleum and D7566 fuel blends 3 May 2017

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SAJF conversion mechanisms

Challenge … doing it at the price of petroleum refining Fossil HC

Lipids

Plant & Animal

Sugars & Wastes & Starch Syngas

Cellulose & Hemi- & Lignin

CH4 CO2

Gasify Pyrolize Torefy Saccharify Deconstruct Digest

$ $ ?

Separate Ferment Dehydrate Catalyze Process FT CH CC APR HL Oligomerize Hydrotreat Hydroprocess Hydroisomerize Distill FT-SPK, HEFA-SPK, HFS-SIP, FT-SPK/A, ATJ-SPK, …

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SAJF blending component examples

3 May 2017

HDCJ

HFS-SIP

CH

ATJ-SPK

HEFA-SPK

FT-SPK

FT-SPK

HEFA-SPK

HEFA-SPK

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SAJF approved production pathways

Approved

Annexes to ASTM D7566: D1655 fuel following blending     

Syngas FT (FT-SPK) Hydroprocessed lipids (HEFA-SPK) Biochem sugars (HFS-SIP) Syngas FT w/ aromatic alkylation (FT-SPK/A) Isobutanol conversion (ATJ-SPK)

50% max blend 50% max blend 10% max blend 50% max blend 30% max blend

∗ Commercialization for each in development, in some cases by multiple parties who would use licensing ∗ Entities may not achieve commercialization for several years following approval 3 May 2017

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ASTM approval pipeline

Low FRL

In- Process Task Forces

Next 3 (‘17–’18 approvals) have implications for lipids ∗ ∗ ∗ ∗ ∗ ∗

Refinery Co-processing 5% max incoming blend Catalytic Hydrothermolysis 50%+ max blend HEFA+ (wider-cut HEFA with HDRD) modest max blend ATJ-SPK (expansion to C2-C5 alcohols) SK/SAK (CCS - APR) ATJ-SKA

∗ 15 additional processes

3 May 2017

∗ 3 specifically applicable to lipids

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Achieving cost competitiveness Lignocellulosic Conversion

High

∗ ∗ ∗ ∗ OPEX

Gasification Pyrolysis Torrefaction Deconstruction miscellanea  Conversion of C5/C6 sugars ∗ Catalytic ∗ Biologic

Low

Economically Competitive Solution Space Low

3 May 2017

High

CAPEX 12

 ∗ ∗ ∗ ∗

Valorization of lignin HTL Steam Chemical / Ionic Biochemical

Achieving cost competitiveness Enabled by:

High

∗ ∗ ∗ ∗

+ ++ ++++ OPEX

Low

Economically Competitive Solution Space Low

3 May 2017

∗ ∗ ∗ ∗

High

CAPEX 13

R&D D&D Support Policy Commercialization learningcurve progression Build-out – Scale Competitive uses Valued co-products …

Enabling approaches informed by analytics

Cost-focus is only part of the need ∗ Techno-economic assessments don’t address total value ∗ Expectation that viability will be enabled via other revenue and other services

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Commercialization in-development Renewable Diesel & Jet ∗ Existing DPA Awardees ∗ Red Rock, Fulcrum ∗ Emerald

∗ ∗ ∗ ∗ ∗ ∗ ∗

AltAir Build out (3-5X) Diamond Green expansion SG Preston (5 facilities in first tranche) ARA licensing and build-out UOP licensing for refinery retrofit Neste, REG, UPM, … potential pivots Unlocking of renewable diesel and refinery co-processing

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Greater than 1B GPY capacity by 2021 !?! … necessitates serious engagement with purpose grown oilseed & FOG development / expansion

Commercialization intent - lipids

“Declared” nameplate capacities: significant opp’ty

Gallons per Year (M)

4,000 3,500 3,000 2,500

24 / 32

If all addressed via oilseeds:  1.5 to 2.0 M acre/yr  1.75x more if refinery coprocessing gets traction

Production Acreage Required (million acres) at 200 / 150 gal/acre

2,000

12 / 16

Significantly more at lower yields of some oilseeds

1,500 1,000 500 0

0/0 Ignores 2.5B gpy biodiesel production

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Lipid feedstocks

Potentially enabling of significant production … ∗ Multiple conversion processes ∗ Multiple feedstock developers ∗ Multiple producers ∗ Multiple low LUC/ILUC agribased feedstocks, plus:

Targeting most sustainable solutions:

Low, or Zero, impact LUC/ILUC & F-v-F solutions; Environmental Services a plus.

∗ White Grease, Poultry Fat, Tallow ∗ UCO / Yellow Grease ∗ Brown Grease, Biosolids

∗ Easier supply chain scale-up leveraging biodiesel and HDRD production capacity ∗ Lowered H2 cost & availability (from NG) helps 3 May 2017

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SAJF offtake agreements

Beyond numerous demonstration programs neat quantities

5 M gpy from 2016 3 yr agreement 30/70 blend 3 yr agreement Enabling LAX flts 375M usg 90-180 M gpy Over 10 yrs 50 M gpy Over 10 yrs 3 M gpy each going into Bay Area, CA 3 May 2017

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SAJF offtake agreements

Beyond numerous demonstration programs neat quantities

48 A350 deliveries 10% blend 10M gpy, 10 yrs Up to 40M gal Over 5 yrs (MOU) (Bioport on demand)

(Salvage MSW work?) (HBE defunct, focus on new engagement)

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Summary of Potential ∗ SAJF technically viable – slowly being commercially developed ∗ Opportunities actually continuing to expand ∗ Challenge is achieving price-point equivalency to petro-jet, but policy has been shown to close business cases ∗ Some producers remain bullish on their costs without policy ∗ Feedstock availability might be pacing for some pathway families, but not envisioned to be an ultimate constraint ∗ Full range of activities ongoing to try to bring down cost, reduce risk, incentivize production, develop feedstocks, … ∗ Oil price and policy mechanisms will be key determinants ∗ Industry still counting on execution of SAJF, commensurate with progress on other pillars 3 May 2017

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Steve Csonka Executive Director, CAAFI +1-513-800-7980 [email protected] [email protected] www.caafi.org

SAJF Qualification Status Vertimas? Global BioEnergies?

SBI BioEnergies?

Collecting Tier 3 & 4 Data & Developing Reports

Approved Fuels

Mark Rumizen October 25, 2016

Collecting Tier 1 & 2 Data & Developing Reports

POET?

Currently In Review Process

Joule?

Shell / GSR / GTI IH2

HDCJ

Virent SK

Annex A5 ATJ SPK (Isobutanol) Annex A4 FT-SKA Annex A3 SIP Annex A2 HEFA Annex A1 FT-SPK

ATJ-SKA (Byogy, (Swedish Biofuels)

Green Diesel (HEFA Plus)

Virent SAK

ATJ-SPK (Ethanol) (LanzaTech) ARA CHJ