Although using CO2 from direct air capture (DAC) is important for e-fuels production in a net zero energy system, it is currently too expensive and could place a very high cost and technology risk burden on the e-fuels sector, concludes an E4Tech study commissioned by Transport & Environment (T&E) and presented in a webinar hosted by the Brussels-based NGO. The study recommends point source CO2 capture – capturing CO2 from industrial sources such as fossil or biomass power plants or cement production – be used in the near term for e-fuel production based on rigorous GHG assessment, while policies are put in place to support the commercialisation of DAC, reports Susan van Dyk. E-fuels are produced from CO2 and hydrogen, and the CO2 can be derived from direct air capture or industrial point sources. T&E estimates demand for e-kerosene (the subcategory of e-fuels suitable for aviation) for flights originating in Europe could grow to nearly 40 Mt in 2050 and completely replace fossil kerosene. It believes sourcing CO2 through DAC is “better than capturing it from industrial sources; a technique which, while cheaper, has the unintended effect of encouraging industries to continue to rely on fossil fuels.”

CO2 from industrial point sources can result in an overall reduction in emissions for the final e-fuel, but when derived through DAC it can potentially deliver carbon neutral e-fuels. Keith Whiriskey, Deputy Director at the Bellona Foundation, provided a perspective on CO2 accounting in DAC at the webinar, emphasising the climate benefits of e-fuels rely on both the source of CO2 and the source of hydrogen. From a carbon perspective, Whiriskey says DAC for e-fuel production is climate neutral. In contrast, CO2 from a point source for e-fuel production, where the CO2 originates from a fossil source, releases that CO2 back into the atmosphere when the e-fuel is combusted. While there is a reduction in CO2 emissions overall, only one of the parties can claim the reduction. From a carbon accounting perspective, the CO2 provider can claim an emission reduction based on carbon capture, but the e-fuel producer cannot simultaneously claim an emission reduction as this will amount to double counting. As Whiriskey explains, “one party can be low carbon – the other party must be full carbon.”

The source of hydrogen is equally important, he says. Unless hydrogen is derived from 100% renewable electricity, emissions from e-fuel production can increase. Whereas hydrogen from wind electricity produces around 0.5 tCO2/tH2, hydrogen from coal-derived electricity produces approximately 35 tCO2/tH2. Besides sourcing the hydrogen from renewable electricity, e-fuel production must be based on new or additional renewable electricity. Whiriskey points out that e-fuel production is an inefficient use of electricity and only offers low emission reductions per unit of renewable electricity used. As a climate measure, the use of renewable electricity for electric vehicles offers six times greater emission reductions, he says.

DAC compared to point source capture of CO2 is therefore not the only factor in determining the climate benefits of e-fuels. DAC can offer much greater climate benefits than point source CO2, and T&E therefore argues it should be considered the preferred source of CO2. However, compared with point source capture of CO2, DAC comes at a higher cost and has greater energy requirements. DAC is also at an early stage of development, explains Jo Howes, Principal Consultant at E4Tech, which was recently acquired by global sustainability advisory firm ERM. The study commissioned by T&E assessed whether, when and how DAC could be scaled up to meet the demands of an e-kerosene industry at the scale needed to decarbonise European aviation.

It determined the current costs of DAC are reported at €100-500/tCO2 ($120-600/tCO2) compared to point source CO2 capture costs of €70-150/tCO2. All DAC companies project much lower costs in the long term, ranging from €40-170/tCO2, but “only some of these are backed up by published data,” Howes told the webinar. At €503/tCO2, e-kerosene is calculated to be €4019/t compared to a current average jet fuel price of around €550/t. While reducing the cost of CO2 to €100/tCO2 can potentially reduce the cost of e-kerosene to €2405/t, this is still more than four times the current price of jet fuel.

Howes believes that requiring DAC for e-fuels would place a very high cost and technology risk burden on the emerging e-fuels sector and recommends point source CO2 should be allowed in the near term but with rigorous project-level GHG assessment. The study identifies the conditions to enable commercialisation of DAC as additional supply-side policy support, such as funding for research, development and demonstration (RD&D) and project investment, along with future mandates for DAC use within fuels policy or as part of broader GHG removal policy.

There are no fundamental limits on scaling up of DAC for future e-fuel production, said Howes. Many companies are currently pursuing DAC commercialisation, and large-scale projects are being developed, with the first 1 Mt/year facilities expected by 2023/2024. The speed of roll-out will depend on the existence of viable markets for CO2 capture, which is not limited to e-fuels production and includes the use of CO2 in industry and carbon capture and storage.

To produce T&E’s estimated annual 40 Mt of European e-kerosene by 2050, it would require 365 Mt/year of CO2 to be captured, finds the study. Canada-based DAC pioneer Carbon Engineering, in partnership with 1PointFive, is expecting to begin construction on a first commercial-scale plant in the United States that will capture up to 1 Mt/year of CO2 that will be stored permanently underground. The company is also piloting its ‘Air to fuels’ technology that is producing around 1 barrel of fuel per day. Swiss DAC company Climeworks, which has 14 plants currently either commissioned or in operation across Europe, is constructing its geothermal-powered Orca direct air capture and CO2 underground storage plant in Iceland. It will capture 4,000 tonnes of CO2 per year, which the company says will make it the world’s biggest climate-positive facility to date. By 2024, Climeworks expects to increase production across its facilities to 40,000 tCO2/year and then to 400,000 tCO2/year globally by 2027.

Based on the conclusions from the report, T&E has made some key recommendations of its own to policymakers. For the upcoming ReFuelEU Aviation initiative about to be announced, T&E recommends that DAC CO2 be required from the start of e-kerosene production, with any project receiving public support requiring a minimum share of 30% DAC, increasing over time to 100%. T&E believes the ReFuelEU legislative proposal should include an e-kerosene sub-target of 1% by 2030. T&E further recommends continued support for DAC RD&D through European and member state funding programmes, such as Horizon Europe, including support for basic and applied research, as well as pilot and demonstration funding.

According to T&E, and in agreement with the E4Tech study, policy support is crucial to “truly tap DAC’s full potential as one of the leading contributors to tomorrow’s clean aviation.” Without such policies, T&E believes DAC companies cannot solve the scalability and cost aspects of the equation. What is absent from the T&E recommendations is direct support for point source capture as proposed by the E4Tech report.

While e-fuels produced using DAC CO2 can undoubtedly deliver significant climate benefits, the high cost of DAC e-fuels is arguably the biggest obstacle to its development. Aggressive policies to support DAC, as outlined by T&E, could support the scale-up of DAC technology and realise the necessary future cost reductions to deliver sustainable fuels for aviation at a competitive price. However, e-kerosene will still need to compete with SAF produced through other technology pathways. Aviation is also a global sector, and European airlines may be reluctant to support policies that will place them at a competitive disadvantage. Several SAF producers using other technologies, have also demonstrated they can produce carbon neutral fuels to deliver similar climate benefits to e-fuels from DAC (see article).

Photo: When operational, Climework’s Orca DAC facility in Iceland will capture 4,000 tonnes of CO2 per year

Susan van Dyk

GreenAir Correspondent

www.svdconsulting.ca

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The UK government has launched a £15 million ($21m) ‘Green Fuels, Green Skies’ competition to support early-stage development of UK sustainable aviation fuel (SAF) plants with grant funding. Specifically targeted are projects undergoing a front end engineering design (FEED) stage in their development lifecycle and will prioritise those projects closest to the development of first-of-a-kind (FOAK) commercial-scale SAF plant. The competition will also be open to projects outside this scope and will allocate up to £2 million in funding to projects at the feasibility stage of project development. The competition is part of UK Prime Minister Boris Johnson’s ‘Ten point plan for a green industrial revolution’ unveiled in November. The announcement coincides with the second meeting of the Jet Zero Council, set up by the government last year in partnership with industry and others to stimulate net-zero emissions flight by mid-century through the development of new aviation fuels and technologies. Heathrow Airport COO Emma Gilthorpe has been appointed CEO of the Council, with a brief to extend its reach with key stakeholders across the sector and drive forward aviation decarbonisation. Meanwhile, the government is to provide £5.5 million in funding towards modernisation of UK airspace.

Commenting after the Council meeting, UK Transport Secretary Grant Shapps said: “As the aviation sector emerges out of the pandemic and looks towards recovery over the coming months, we must put our environmental commitments at the centre of everything we do – so not only do we build back better, we also build back greener. That’s why we’re stepping up our work on the Council, recruiting new members and launching pioneering efforts to ensure we continue to lead the world by example and deliver on our ambitious net-zero targets.”

Added Business Secretary Kwasi Kwarteng, who co-chairs the Council with Shapps, said: “The meeting demonstrates the vital collaboration between government and industry that will make zero-emission flights a reality. Britain’s aerospace sector is at the centre of our plans to build back greener from the pandemic. We are committed to supporting its recovery and investing in green tech to take us closer to zero-carbon take-off.”

One of the objectives of the Jet Zero Council is to accelerate SAF delivery by supporting investment in FOAK SAF plants, supporting R&D of new pathways and to drive down production costs through upscaling and innovation. The ‘Green Fuels, Green Skies’ (GFGS) competition is being run by the Department for Transport (DfT) in partnership with E4tech and Ricardo Energy & Environment, who were also responsible for the Future Fuels for Freight and Flight competition that was launched in 2017 and had applications for funding from the Velocys Altalto waste-to-jet project and the LanzaJet SAF from waste-based ethanol project.

The new competition follows on from a DfT-commissioned study by E4tech and Ricardo to assess the feasibility of a grant-funded competition and the types of funding mechanisms that could help support FOAK commercial SAF plant development in the UK. The study concluded there was a pool of UK and international developers that could build such plants but technology risk, high capital costs and uncertainty on the monetary value of policy support meant there were key barriers that needed to be overcome. It found that FOAK commercial plants could cost £600-700 million ($830-$970m) to build, which required government to “think big”, with policy measures to provide sufficient revenue certainty to investors to make projects financially viable.

The study indicates a UK SAF market could generate between £700m and £1.66bn in gross value added (GVA) to the UK economy, with potentially half of this being generated from the export of IP and the provision of engineering services, and create between 5,000 and 11,000 green jobs. Replacing imported kerosene with domestically produced SAF would also increase fuel security and have a net positive impact on the UK’s balance of payments.

The competition sets a number of objectives for projects to receive financial support:

• Technology demonstration: materially progress a project towards FOAK commercial production of an eligible SAF pathway.
• Fuel production: materially develop a project with the capability to produce commercially significant volumes of SAF, including for the purposes of attaining certification.
• Commercial potential: materially develop a strategy for commercialising the technology and the products from the project, demonstrating the significant value to the UK.
• Emissions reduction: demonstrate the potential for GHG reductions of a technology pathway compared to a fossil fuel equivalent.
• Project execution: bring together a team with the necessary expertise and experience to deliver the project according to its objectives.

Application forms for the competition are available to download from the Ricardo website on March 24 and the closing date for applications is May 31. The DfT expects to announce the winners and the start of the funding period at the end of July, with the funding period for winning projects due to end on March 31, 2022.

“This funding is a positive step closer to getting a British sustainable aviation fuel industry off the ground,” commented Adam Morton, Chair of the UK cross-industry group Sustainable Aviation. “But if the UK is serious about becoming a world leader in SAF production and supply, the government must accelerate its support for this nascent industry by complementing this funding with the right policies to support the commercialisation of SAF at scale, as we have set out. With a world-leading SAF industry and innovations in electric and hydrogen aircraft, Britain can become a Jet Zero pioneer.”

Under another initiative, ‘Future Flight Challenge’, the UK government has committed £125 million ($173m) of funding over four years, matched by £175 ($243m) million from industry, to develop green flight – such as all-electric aircraft and deliveries by drones – by advancing electric and autonomous flight technologies. Project 2ZERO announced plans this week to use their £2.4 million share of this funding to demonstrate flights of six- and 19-seat hybrid-electric planes. The project will validate the use of electric and hybrid aircraft on regional routes, showing the potential to decarbonise aviation while supporting regional connectivity.

Following an independent review into UK transport connectivity, the government has said a consultation will be launched shortly on aviation tax reform that will include options to change Air Passenger Duty (APD) for domestic flights, such as reintroducing a return leg exemption or creation of a new lower domestic rate. It will also consider increasing the number of APD international distance bands as well as mandating the use of sustainable aviation fuels. As some European governments move towards closing down short domestic routes in favour of train travel, Prime Minister Johnson said he wanted to cut APD on domestic flights to support UK connectivity.

Asked by BBC Radio this week on how a cut in APD on domestic flights would square with the government’s net-zero commitment, Transport Secretary Shapps said: “We want to do both and we’ll do that, for example, by using sustainable aviation fuel mandates in future on domestic flights to remove carbon.”

The government has also announced funding of £5.5 million ($7.6m) to support modernisation of the UK airspace to reduce journey times, pollution and delays. It said the funding would aid the industry as it develops and evaluates new flight routes, and play a role in the UK CAA’s Airspace Modernisation Strategy when travel restrictions are lifted.

“As an island nation, our airspace is vital in keeping us connected to the rest of the world,” said Aviation Minister Robert Courts. “Modernising our ‘sky motorways’ could put an end to the days of circling the airport waiting for a landing slot, improving efficiency, and leading to flights that are quicker, quieter and greener than ever before.”

Responding, the UK Airport Operators Association’s Chief Executive, Karen Dee, said: “Airspace modernisation will be essential for aviation to build back better, so that a recovery of 2019 passenger levels does not come with 2019 noise impacts and carbon emissions. We look forward to working with the government and the Airspace Change Organising Group to deliver modernisation and to help achieve aviation’s net zero by 2050 commitment.”

The government says it has pledged around £7 billion ($9.7m) for the aviation sector since the start of the pandemic “while working to develop a framework for the restart of safe and sustainable international travel.”

Photo: Heathrow Airport

A consortium led by sustainable aviation fuel (SAF) supplier SkyNRG, with LanzaTech as the technology provider, is to build Europe’s first LanzaJet alcohol-to-jet (AtJ) facility. The pre-commercial production plant will convert waste-based ethanol to 30,000 tonnes – about 37 million litres – of SAF per year and is expected to pave the way for extended commercial production capability across Europe and globally. Other partners in the FLITE (Fuel via Low Carbon Integrated Technology from Ethanol) consortium include Europe’s largest applied research organisation, Fraunhofer; energy and sustainability strategy consultancy E4tech; and standards body the Roundtable on Sustainable Biomaterials (RSB). The project has received €20 million ($24m) in grant funding from the EU’s Horizon 2020 research and innovation programme. The facility is expected to be fully operational in 2024.

“With the increasing demand for SAF in the future, there is a need to diversify SAF technologies and feedstock,” commented Maarten van Dijk, SkyNRG’s Managing Director. “This first-of-a-kind AtJ production in Europe will be an important step in the direction of making SAF more accessible and scalable, supporting net zero ambitions for the aviation industry.”

SkyNRG will act as the project’s coordinator and manage downstream supply chain development, with LanzaTech responsible for plant design, construction and operations. The waste-based ethanol will be sourced from multiple European producers, says the consortium.

“Bending the carbon curve requires collaboration and strong partnerships, something the FLITE consortium exemplifies, and we look forward to implementing LanzaJet technology in Europe,” said LanzaTech CEO Jennifer Holmgren. “This is an important enabler to expanding production of SAF and creating a path to a lower carbon future. We are grateful for the Horizon 2020 funding, which has made this project possible.”

Fraunhofer will oversee and distribute communications about the project and E4Tech will conduct the lifecycle assessment, while the RSB will provide guidance on sustainability certification of the facility.

“This project addresses two key challenges faced by the aviation sector today: rapid decarbonisation and doing so in a sustainable manner,” said RSB Executive Director Rolf Hogan. “It aims to scale the production of SAF in Europe and ensure it meets the most stringent sustainability standards. The RSB is proud to support partners to demonstrate sustainability performance and meet regional and global regulatory requirements of the EU Renewable Energy Directive and ICAO’s CORSIA.”

The consortium says it expects to name the location of the facility shortly and reports a number of airlines having shown interest in purchasing the SAF.

SkyNRG is already leading a project to build Europe’s first commercial SAF plant, named DSL-01, in Delfzijl, the Netherlands. It was due to be commissioned in 2022, although this is now unlikely in the light of present circumstances and the timeline is being reviewed and updated, says SkyNRG. When completed, the plant is set to produce 100,000 tonnes of SAF annually from waste and residue streams such as used cooking oil. The project is being supported by Shell, which has an option to purchase SAF from the facility, with KLM committed to purchasing 75,000 tonnes annually for 10 years.

Photo: SkyNRG