insight Sustainable Flying:

Biofuels as an
Economic and Environmental Salve
for the Airline Industry

EQ²
Email: enquiries@eq2.eu.com
UK: 0845 371 2520
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Executive Summary Feb 2010

The aviation industry will need carbon-neutral biofuels as a feasible and desperately needed way to reduce
its reliance on fossil fuels and cut its greenhouse gas emissions. The EU Emissions Trading Scheme (EU ETS),
starting from 2012, will put a direct cost on carbon emissions for all flights into or out of Europe. It is likely
only a matter of time before most flights around the world will be similarly taxed. More than just the carbon
risks, the airline industry has been battered by unstable jet fuel prices and biofuels offer a potentially more
stable (not to mention more sustainable) fuel source.

This report provides a review of the development of biofuels for aircraft and a critical examination of the
economic and climate impacts of the aviation industry moving towards the large-scale adoption of biofuels.

• Bio-derived Synthetic Paraffinic Kerosene (Bio-SPK), made from Jatropha, Camelina, algae or
halophyte feedstocks, is the most promising candidate for alternative jet fuel and test flights
have successful proven its feasibility as a replacement for conventional jet fuel.

• Although not commercially viable yet, the EU ETS offers a strong financial incentive for the
adoption of bio jet fuels. Based on the current EU ETS price for carbon in 2012 of €15 and
2009 average jet fuel price of $1.69 per gallon, every gallon of jet fuel burned would incur
carbon costs of an additional $0.21, which is a total cost of $1.34 billion across the industry.
This is a premium of 12.4% that would not apply to biofuel, but would help make it more cost
competitive.

• Further out, the EU ETS will impose costs of $9.56B in 2020 and $19.48B in 2030 on the airline
industry. This will be equivalent to approximately 3.6% of the total operating cost of the EU
aviation industry by 2030. While airlines may be able to pass along some of these costs to
consumers, it is too competitive a market for the industry to reap windfall profits, particularly
in later years when the industry needs to buy most (and likely all) of its carbon credits.

• Based on the Air Transport Action Group (ATAG) industry body assumptions of 15% and 30%
consumption of biofuel in 2020 and 2030, the EU aviation industry will be able to avoid 35
million tonnes of CO2 emissions in 2020 and 100 million tonnes in 2030. Such reduction in
emissions is equivalent to $2.01 and $5.84 billion of savings on carbon expense in 2020 and
2030, respectively.

• Based on the same assumption of aviation biofuel consumption, the global aviation industry
will be able to avoid 129 million tonnes and up to 420 million tonnes of CO2 emissions in 2020
and 2030, respectively.

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• If the global aviation industry is to achieve the International Air Transport Association (ATA)’s
aim of carbon neutral growth from 2020 solely by biofuel consumption, it will need to use
approximately 46.1–72.0 billion gallons of biofuel in 2030, which is equivalent to 38-49% of
total jet fuel consumption.

The internalisation of billions of dollars carbon costs by the air transportation industry will provide a sig-
nificant financial incentive for the development and adoption of new carbon reduction alternatives. Biofuel
offers the only near to mid-term solution for the industry to significantly reduce its climate impact, with the
added benefit of diversifying away from non-renewable fossil fuels.

16001600
$200
CO emission (Million metric tonnest)

Credit Cost ($ bn) Avoided CO emission

Avoided CO emission
$160 12001200
Biofuel Cost ($ bn)
CO emission (Mt)

Jet Fuel Cost ($ bn)

Expense ($ bn)

$120
800 800

$80

400 400
$40

$0 0 0
201
0
201
2 uel) iofuel) uel) iofuel) biofuel) 20102010 20202020 2030 2030Low Low 2030 High
biof b biof b 2030 High
2 0 (no 0 (15% 3 0 (no 0 (30% neutral
20 202 20 203 030 (C (15%(15%
biofuel) (30% (30%
biofuel) biofuel) (15% (30%
biofuel) biofuel)
biofuel)
2

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Content
1. Introduction: Biofuel in aviation
1.1 The challenges faced by the aviation industry
1.2 Bio-derived Synthetic Paraffinic Kerosene (Bio-SPK)
1.3 The feedstock
1.4 Environmental benefit
1.5 Economic viability of Bio-SPK
1.5.1 Price and production cost uncertainties
1.5.2 Oil price pressure on biofuel producers
1.5.3 Aviation industry’s dependence on fossil fuel
1.5.4 Emission trading
1.6 Other alternative jet fuels

2. Environmental and financial impacts of aviation biofuel

2.1 Main assumptions
2.2 Biofuel, EU aviation and EU ETS
2.3 Biofuel and carbon-neutral growth
2.3.1 Outlook of global aviation CO2 emission
2.3.2 How much biofuel does the aviation industry need in order to
achieve carbon-neutral growth from 2020?
2.4 Global emission trading scheme for aviation
2.5 Aviation biofuel as a competitor to conventional jet fuel
2.6 Biofuel vs. Carbon offsetting

3. Bio-SPKs – the future of aviation fuel?

Business Sustainability

4. References

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1. Introduction: Biofuel in aviation
Kerosene-type jet fuel has been the prevalent fuel used by commercial aircraft since
World War II when it became financially preferable to gasoline-type fuels. The specifi-
cation for the fuel was established in the 1950s and has not changed since. Such a mo-
nopoly of fossil fuel in the aviation industry is set to change with the next generation of
new, sustainable jet fuel – biofuel.

In 2008, airlines started to carry out test flights using jet fuel blended with biofuel.
Virgin Atlantic was the first to carry out a test flight with a blend of coconut-derived
methyl ester with conventional jet fuel. Later in 2008, different airlines started to join
the aviation biofuel testing trend and perform test flights with biofuel derived from
a variety of feedstocks. Up to December 2009 there were five successful biofuel test
flights performed by Air New Zealand, Continental Airlines, Japan Air Lines, Qatar Air-
ways and KLM. In addition, Jet Blue, Interjet and British Airway have already scheduled
their biofuel test flights in 2010.

1.1. The challenges faced by the aviation industry

There are two main drivers for Figure 1 - Jet Fuel and Crude Oil Price ($/barrel)
the development of a sustainable
alternative aviation fuel. The first
driver is the financial risk of the
dependence on conventional fos-
sil fuel-derived jet fuel. Shadowed
by the suspicion of peak oil and
no sign of decline in demand for
energy and coupled with a range
of market uncertainties (weather
events, U.S. Dollar trend, etc), jet
fuel price is not likely to be stable
and such volatility has and could Source: Platts, RBS
continue to exert enormous pres-
sure on the operation of the airlines. Although such risk can be financially hedged to
some extent, the problem is not resolved as long as the industry still depends on non-
sustainable fuel.

The problem is further worsened by the climate change crisis. The environmental is-
sues are so important nowadays that they are given the same priority as the economy
on the national and global agenda. Translating these environmental issues into busi-
ness operating terms is leading to additional regulations and compliance, which means
a tougher operating environment. Companies endeavour to remain profitable while
paying a considerable amount of attention to their environmental footprint. A com-
pany’s obligation on environment has become the second driver for the development
of sustainable aviation fuel.

1.2. Bio-derived Synthetic Paraffinic Kerosene (Bio-SPK)

Haunted by these operational pressures, airlines are looking for ways to become in-
dependent of conventional jet fuel and the use of bio-derived jet fuel is considered to

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be the way forward. One of the most promising candidates for alternative aviation fuel
is Bio-derived Synthetic Paraffinic Kerosene (Bio-SPK). Bio-SPK is the biofuel used in
all the test flights mentioned above, apart from Virgin Atlantic’s. It is the most tested
type of biofuel by the aviation industry and has shown very similar performance levels
to conventional jet fuel. In understanding the potential of Bio-SPK to the aviation in-
dustry, this paper will provide an informative and critical account of the environmental
and financial benefits and uncertainties of Bio-SPKs both to airlines and the industry
as a whole.

1.3. The feedstock

To understand the significance of the Bio-SPKs, we can start with the figurative and lit-
eral roots – the feedstock. The production of transportation biofuels using food crops,
such as biodiesel and ethanol has generated enormous social and environmental con-
cerns. One of the most furiously debated topics with regard to biofuel is the conflict
between food and fuel production. A small, but significant portion of food crops (such
as corn for ethanol) have been turned in to biofuel, leading to a fall in the output and

Figure. 2 - The four most promising feedstock for “second generation” biofuel 1

Camelina Algae Jatropha Halophytes

Camelina has high lipid oil con-
tent and the primary market of
its oil is as a feedstock to pro-
duce renewable fuels. Camelina
is often grown as a rotational
crop with wheat and other ce-
real crops when the land would
otherwise be left fallow as part
of the normal crop rotation pro-
gram.
Algae is potentially the most Jatropha produces seeds con- Halophytes are salt marsh grass-
promising feedstock for produc- taining inedible lipid oil that can es and other saline habitat spe-
ing large quantities of sustain- be used to produce aviation fuel. cies that can grow either in salt
able aviation biofuel. These mi- Each seed produces 30 to 40% of water or in areas affected by sea
croscopic plants can be grown its mass in oil and is capable of spray where plants would not
in polluted or salt water, deserts growing in a range of difficult soil normally be able to grow.
and other inhospitable places. conditions, including arid and
They thrive on carbon dioxide, otherwise non-arable areas. The
which makes them ideal for car- seeds are toxic to both humans
bon capture (absorbing carbon and animals and are therefore
dioxide) from sources like power not a food source.
plants. One of the biggest advan-
tages of algae for oil production
is the speed at which the feed-
stock can grow. It has been es-
timated that algae produces up
to 15 times more oil per square
kilometer than other biofuel
crops.

1
Beginner’s Guide to Aviation Biofuel, Air Transport Action Group (2009)

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storage of edible crops to historically low levels; a study by the World Bank in 2008
suggested that biofuel production has caused the world’s food prices to surge by 70-
75% 1.

This, furthermore, led to another long-term environmental problem; the alternation

of land use and deforestation, which contributes significantly to GHG emissions, thus
causing an increasing rate of climate change.

Moreover, all of these biofuels cannot be used directly by aircraft. Refining biofuel to
aviation fuel involves energy-intensive manufacturing processes and in so doing, the
cost and life-cycle GHG emission of these processed biofuels increase substantially and
can exceed that of conventional jet fuel.

While commercialisation of food-derived biofuels may be unsustainable, Bio-SPKs are

derived from a new array of feedstocks, namely Jatropha, Camelina, algae and halo-
phytes. Biofuel derived from these feedstocks are sometimes referred as ‘second-gen-
eration biofuel’ and they share two overwhelming advantages over traditional biofuel
feedstocks. The first advantage is that these second-generation feedstocks are all ined-
ible, which means the production of bio-SPK will not compete with the food supply.
The second advantage is that the feedstock vegetations do not need to be cultivated
on fertile farmland. For example, Jatropha is resistant to drought and pests and can
be grown on non-arable land. This gives them the potential to be cultivated in remote
areas or factories

Bio-SPK Production Technology

Bio-derived Synthetic Paraffinic Kerosene (Bio-SPKs) is the most promising candidate for sustainable alternative
aviation fuel. The current research into Bio-SPKs is being conducted using second-generation feedstocks. Second-
generation biofuel generally refers to biofuels that are derived from sustainable and inedible biomass sources;
Bio-SPKs represent biofuel derived from sustainable feedstocks that have the same distillation range as the jet fuel
and can be used readily by aircrafts.
There are two main processes to produce Bio-SPKs: Fischer-Tropsch processing and hydro-processing.

Fischer-Tropsch
The Fischer-Tropsch (FT) process is a process that al-
lows the production of liquid fuel, such as gasoline,
diesel and jet fuel, from carbonaceous feedstocks
including natural gas, coal and biomass. Aviation bio-
SPKs can be produced from the FT process using bio-
mass feedstocks. The FT process involves four main
steps:
1. Creation of synthesis gas from feedstocks
2. Removal of CO2 and other undesired compounds
3. FT synthesis using iron- or cobalt-based catalyst
4. Upgrading to liquid fuel by refining
Hydro-processing
Bio-SPKs that are produced from hydro-process-
ing are referred to as hydro-processed renewable
jet fuel (HRJ). The production of HRJ includes a
process that first uses hydro-processing to deoxy-
genate the oil and then uses hydro-isomerization
to create isoparaffinic hydrocarbons. The chemi-
cal contents of these HRJs can fill the distillation
range of conventional jet fuel and are thus suit-
able for aviation use.

1
A Note on Rising Food Prices, The World Bank (2008)

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Figure. 3 - Comparison of life cycle GHG emissions between con- 1.4 Environmental benefit
ventional jet fuel and aviation biofuel

In terms of environmental effect, the greatest ad-

vantage of Bio-SPK is that not only is it a carbon-
neutral fuel, but it also releases significantly fewer
greenhouse gases (GHGs) than conventional jet fuel
in its life cycle. As a fuel, Bio-SPKs are considered to
be carbon neutral because the amount of CO2 ab-
sorbed by the feedstock during cultivation is roughly
the same as the amount of CO2 released back to the
atmosphere when they are burnt, as opposed to
fossil fuels that release GHGs that are buried under-
ground. However, there are both direct and indirect
carbon emissions related to the production of the
fuel, including processes from feedstock harvest-
ing and transportation, to oil extraction and hydro-
treatment. As these processes cause GHG emissions,
they are considered in the calculation of life cycle
GHG emissions of the fuel. It is sometimes referred
to as the ‘well-to-wake’ GHG emissions – the emis-
sions from the wellhead through refining and final
combustion and emission in an airplanes wake (see
Figure. 3).

Second-generation biofuels show substantial reduc-

Source: Beginner’s Guide to Aviation Biofuels, ATAG 2009
Figure. 4 - Life-cycle GHG emission comparsion between peto-
leum jet fuel and Bio-SPKs
tion in life cycle GHG emissions compared to conven-
tional jet fuel. The amount of life cycle emissions re-
duction is estimated in the range from 20 – 98% less
than conventional jet fuel, depending on the type of
feedstock. Apart from the benefit in GHG emissions,
Bio-SPKs also have much lower particulate matter
(PM) and sulphur content than conventional jet fuel.
The sulphur content in bio-SPKs is below 15 parts
per million, while conventional Jet-A consist of 700
parts per million of sulphur on average.

90 However, it is important to address the potential

80 Cultivation environmental impact of the development of sec-
70 Fuel Production ond-generation biofuel. Although the feedstock of
60 Use second-generation biofuels are inedible and can be
g CO2 eq/MJ

50
Oil Production grown in non-food crop farmland, developers must
Transportation plan the production thoroughly to minimise the
40
environmental footprint. Figure. 5 shows that the
30
life-cycle GHG emissions of biofuels can be greatly
20 increased due to misuse of land. Another potential
10 problem that may be caused by biofuel development
0 is the introduction of invasive species. The introduc-
Petroleum Jatropha Camelina tion of alien species can lead to serious ecological
Jet fuel Bio-SPK Bio-SPK
disasters and great care must be taken to restrict the
Source: Evaluation of Bio-Derived Synthetic Paraffinic Kerosenes undesirable propagation of feedstock vegetation.
(Bio-SPK), Boeing (2009)

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Figure. 5 – the potential life cycle GHG emission intensity (normalised with conventional jet fuel) of differ-
ent type of alternative jet fuel in different production scenarios. This figure illustrates how unsustainable
cultivation of feedstock can lead to dramatic increase in life cycle GHG emissions of biofuel.

Source: Near term feasibility of alternative jet fuel, Hileman et al. (2009)

Scenarios
(S0) No land-use change (Soy oil to HRJ)
(S1) Grassland conversion to soybean field (Soy oil to HRJ)
(S2) Worldwide conversion of noncropland (Soy oil to HRJ)
(S3) Tropical rainforest conversion to soybean field (Soy oil to HRJ)
(P0) No land-use change (Palm oil to HRJ)
(P1) Logged-over forest conversion to palm field (Palm oil to HRJ)
(P2) Tropical rainforest conversion to palm field (Palm oil to HRJ)
(P3) Peatland rainforest conversion to palm field (Palm oil to HRJ)

1.5 Economic viability of Bio-SPK

The technology for extracting oil from inedible feedstock is available and Bio-SPKs test
flights have shown promising results; both producers and airlines are keen to get the
fuels on to the market. However, there are several uncertainties on the economic vi-
ability of Bio-SPKs.

1.5.1 Price and production cost uncertainties

Firstly, it is hard to accurately estimate the economic viability of bio-SPKs due to the
lack of price and production cost information. The price of bio-SPKs largely depends
on the underlying feedstock from which they are derived. Currently, Camelina can be
produced at low cost and will have a price comparable to conventional jet fuel in the
near future. On the other hand, producing a gallon of algae-derived biofuel would cost
$32.81, according to its manufacturer Solix in April 2009 1. Although Solix suggests that
it can reduce the cost to $3.50 a gallon in the near future, there is no clear timeline for
such development. The price of bio-SPKs is also determined by the method of produc-

1
“It’s $33 a gallon”, Greentech media (2009)
http://www.greentechmedia.com/articles/read/algae-biodiesel-its-33-a-gallon-5652/

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tion. The current production price estimation for coal-and-biomass-derived Fischer-
Tropsch jet fuel from a coal-and-biomass-to-liquid (CBTL) FT plant range from $1.97 to
$2.39 per gallon. However, pure biomass-derived FT fuel produced from a biomass-to-
liquid (BTL) FT plant costs $6 per gallon. For hydro-processed renewable jet fuel, which
most of the test flights used, cost information is not yet publicly available.

1.5.2 Oil price pressure on biofuel producers

Given the lack of cost information for second-generation biofuels, we can consider the
problem from another perspective. One of the dominating factors that determines the
development of next generation biofuel is the price of crude oil. Due to high produc-
tion costs, the biofuel industry is particularly vulnerable to low oil prices. According to
the International Energy Agency’s World Energy Outlook 2009, the investment in con-
ventional biofuel production has fallen heavily over the past year and such a downturn
is directly linked to the sharp reversal of oil prices from their peak in late 2008. A series
of new bio-fineries’ construction has been put on hold and many existing plants have
been left idle in recent years. Therefore, the question for aviation biofuel developers
as well as the aircraft operators is whether they are going to face the same problems.

Figure. 6 - Global assest financing of bio-refinery. The figure suggests that the amount of
investment in biofuel sector closely resemble the trend of oil price
Source: World Energy Outlook 2009, IEA (2009)

1.5.3 Aviation industry’s dependence on fossil fuel

To answer this question, we should consider one of the main incentives to develop
aviation biofuel – the aviation industry’s complete dependence on liquid fossil fuel.
This is the strongest incentive for the aviation industry to develop aviation biofuel.

There is a fundamental difference between the natures of energy consumption in the

aviation industry versus other sectors. While switching energy supply from coal to re-
newable energy sources is relatively easy for manufacturing or ground transportation
industries, it is not the same case for aviation. Aviation is a truly international and

1
Press Releases: Questions & Answers on Aviation & Climate Change, European Union (2005)

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mobile industry that involves personnel, facilities and infrastructure all over the world.
Such reliance makes the aviation industry extremely vulnerable to the instability of oil
prices and such financial risk makes the aviation industry keen to develop alternative
fuels and gradually reduce its dependence on fossil fuel.

Therefore, economically and financially speaking, the aviation industry’s desire for a
‘drop-in’ renewable fuel far exceeds any other industry simply due to the lack of alter-
native solutions. Although aviation biofuel developers will be stressed by the fluctua-
tion of oil prices, they are likely to have a more stable client base and receive robust
support from the airlines.

1.5.4 Emissions Trading

In addition to a strong incentive driven by the dependence of crude oil, there are direct
financial benefits to support the development of aviation biofuel – the implementa-
tion of carbon emissions trading regimes. Emissions trading is regarded often as the
best and most economically efficient global mechanism for tackling climate change.
In 2008, the global carbon market was estimated to be worth more than $125 billion.

The European Union Emission Trading Scheme (EU ETS) is the key framework for achiev-
ing the emissions reduction targets the EU has set out as part of its commitment under
the Kyoto Protocol. Accounting for over half of all global aviation emissions, flights de-
parting from and arriving into the EU play a key role in fighting climate change. The EU’s
increase in CO2 emissions from international aviation has been rapid and it is estimated
that emissions will rise 150% by 2012 compared to 1990 levels if such growth rates
continue. As such increases in aviation emissions would offset more than a quarter of
the emissions reductions the EU is required to make under the Kyoto protocol 1.

From January 2010, all aircraft operators in the EU are required to take part in the EU
ETS. Aircraft operators are now obligated to submit their annual emissions and tonne-
kilometre data for benchmarking purposes. Emission allowances, called European
Union Allowances (EUAs), will be issued to the operators in 2012, when they will have
to start paying for their emissions. The total quantity of allowances to be allocated to
aircraft operators in 2012 will be equivalent to 97% of the historical aviation emissions
and the cap will be further tightened in the following years.

15% of the EUAs will be auctioned in 2012 and the rest will be allocated freely to the
aviation industry. It is anticipated that auctioned EUA will reach 100% by 2020, which
means the aviation industry will need to pay for every tonnes of CO2 they emit. The
implementation of emissions trading scheme will generate significant financial pres-
sure on the aviation industry. Regarded as carbon neutral, biofuel will provide an op-
portunity for the aviation industry to reduce its expense on carbon credits. The impact
of emissions trading scheme implementation and the potential opportunity of aviation
biofuel will be quantitatively examined in the following section.

1.6 Other alternative jet fuels

Although the aviation industry is eager to find a replacement for traditional jet fuel,
Bio-SPKs are not the only alternative jet fuel available.

Jet A derived from oil sands or Venezuelan Very Heavy Oils (VHO) is an alternative fuel
that is already in wide commercial use, with a cost competitive with conventional Jet

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A. The refining technology is well developed and there is a sufficient supply of oil sands
from Canada. The down side of oil sands-derived Jet A is that they have even higher
lifecycle GHG emissions than conventional jet fuel and they are not derived from sus-
tainable feedstocks and are not carbon neutral.

Another type of alternative jet fuel that is of wide commercial use is Fischer-Tropsch
synthetic jet fuels. While Bio-SPKs produced by FT processes are still in the develop-
ment stage, mainly due to the immaturity of the supply of the second-generation feed-
stocks, FT fuel derived from fossil fuel has long been used by the aviation industry.
Since 1999, aircraft leaving O. R. Tambo International Airport in Johannesburg, South
Africa, may receive a blend of up to 50% FT synthetic fuel. However, the downside of
FT synthetic fuels is that their lifecycle emissions are significantly higher than conven-
tional crude-oil derived jet fuel. Compared with conventional jet fuel, coal-derived FT
fuel is estimated to be 2.0 to 2.4 times higher in lifecycle GHG emissions and natural
gas-derived jet fuel is about 1.15 times higher 1.

Recently FT fuel suppliers are putting efforts into minimising the environmental im-
pacts of FT synthetic fuel production by employing carbon capture and sequestration
(CCS) technology. This would contribute to a substantial reduction in life-cycle emission
of FT synthetic jet fuel down to 0.8 to 1.3 times that of conventional jet fuel.

These alternative jet fuels, though still fossil-fuel derived and not sustainable, could
be used as a substitute for conventional jet fuel before Bio-SPKs are available in com-
mercial scale.

2. Environmental and financial impacts of aviation biofuel

This section analyses the environmental and financial impacts of biofuel on the avia-
tion industry. This section will quantitatively demonstrate:

1. Potential impact on conventional jet fuel consumption caused by the intro-

duction of aviation biofuel

2. Environmental abatement in terms of CO2 emissions reduction

3. The related cost implication for the introduction of aviation biofuel

Carbon emissions trading will also be taken into account when estimating the cost
implications. Due to the uncertain perspective of a global emissions trading system for
the aviation industry, we will consider the environmental and financial impact for the
EU and global aviation industries separately.

1
Technical Report: Near-Term Feasibility of Alternative Jet Fuels, Hileman, et al (2009)

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2.1 Main assumptions

Our projections and estimations are based on the following assumptions:

• Rate of biofuel commercialisation

In this report, based on the commercialisation rate suggested by Air Transport Action
Group, we assume that aviation biofuel consumption will be equal to 15% and 30% of
total jet fuel consumption in 2020 and 2030, respectively.
Source: Beginner guide to aviation biofuel, Air Transport Action Group & enviro.aero (2009)

• Conventional aviation fuel price

Unit 2010 2012* 2020 2030

Barrel $139.00 $139.56 $145.00 $205.00

Gallon $3.31 $3.32 $3.45 $4.88

Table. 1 - Assumptions for conventional aviation fuel price: 2010, 2012, 2020 & 2030
Source: IATA economic briefing: outlook for oil and jet fuel price, IATA (2008)
*Jet fuel price 2012 is projected with linear projection based on the IATA Economic Briefing figures

• Carbon price
Currency 2012 2020 2030
EURO/tCO2 €15.00 €40.00 €40.00
USD/tCO2 $21.95 $58.53 $58.53
Table. 2 - Assumptions for carbon credit price: 2012, 2020 & 2030
Source: 2012 carbon price – Carbon Price Summary, Vertis Finance (2009)
2020 and 2030 carbon price - IATA 2008 Report on Alternative Fuel, IATA (2008)
December 2009 exchange rate - 1 EURO = 1.4632 USD

• EU ETS aviation emission cap

2012 Cap 2013 onwards
(97% cap (95%
emission (Mt)
average) average)
EU27 148.90 144.43 141.45

Table. 3 - Assumptions for EU ETS emission caps for aviation

Source: Transportation emission data, European Commission (2009)

There will be other assumptions related with each specific case and will be stated in
the footnotes.

2.2 Biofuel, EU aviation and EU ETS

We estimate the cost implications of the EU ETS to the EU aviation industry to be sig-
nificant. In 2012, the aviation industry will be included in the EU ETS and the emis-
sions cap will be approximately 144 million tonnes (Mt) based on historical emission
levels. We estimate that the total CO2 emissions of EU flights will reach around 184 Mt
in 2012. This implies that the aviation industry will need to spend a total amount of
$1.34 billion on European Union Allowances (EUAs), including the 15% auctioned EUAs

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Table. 4 – Fuel consumption and CO2 emissions implications of biofuel consumption for EU27 aviation

2010 2012 2020 2020 2030 2030 2030

No w/ No w/ Carbon neutral
Scenarios
biofuel biofuel biofuel biofuel growth from 2020)
- - - 15 - 30 40.2
Total jet fuel
18.10 19.23 24.47 24.47 34.78 34.78 34.78

- - - 3.67 - 10.43 13.98

gal)
Total CO2 emissions (Mt) 173.22 183.98 234.13 199.01 332.81 232.97 199.01
CO2 emissions avoided by
- - - 35.12 - 99.84 133.80
biofuel (Mt)

Table. 5 – Cost implication and benefit associated with EU ETS compliance

2010 2012 2020 2020 2030 2030 2030

No w/ No w/ Carbon neutral
Scenarios
biofuel biofuel biofuel biofuel growth from 2020)
- - - 15 - 30 40.2
EUA expense ($ bn) $1.34 $9.56 $7.51 $19.48 $13.64 $11.65
Avoided EUA expense ($
- - - $2.06 - $5.84 $7.83
bn)
Total (maximum)
$59.91 $65.23 $94.04 $94.04 $189.25 $189.25 $189.25
expense on fuel ($ bn)
EUA expense vs total
- 0.72% 3.56% 2.79% 3.60% 2.52% 2.15%

*Total operating cost is calculated based on the assumption that total fuel expense account for 35% of the total operat-
ing cost. [Source: Boeing, IATA]

and the purchased EUAs from other industry sectors, and excluding the free credits
allocated to them. Without biofuel, we estimate the potential EUA cost on airlines will
rise to $9.6 billion in 2020 and $19.5 billion in 2030. Such an increase is dramatic and is
equivalent to an 11% spending increase on carbon credits annually.

Relating these figures with business operation terms, spending $1.34 billion on EUAs
in 2012 is equivalent to nearly 2% of the total fuel cost. The percentage rises sharply to
10% of the total fuel costs when the credit expense reaches $19.5 billion in 2030 if no
biofuel is used by the aviation industry. This rapid increase is driven by a combination
of aviation industry growth, increase in EUA prices and an increase in auctioned EUAs.
In other words, assuming that fuel cost accounts for 35% of airlines operating costs,
the carbon credit expense in 2030, without using biofuel, would be equivalent to ap-
proximately 3.6% of total operating cost.

There is a possibility that the spending increase will be even sharper than we estimate

Table. 6 – Biofuel price premium in US Dollar per gallon

EUA price Biofuel price Projected jet fuel Percentage price
($/tonnes) premium ($/gal) price ($/gal) premium

2012 $21.95 0.21 3.32 6.33%

2020 $58.53 0.56 3.45 16.23%
2030 $58.53 0.56 4.88 11.48%

10 www.eq2.eu.com Managing the Future Today

 insight

Figure. 7 - Projection of 2010 - 2030 jet fuel consumption of EU27 between 2012 and 2020 because it is a possibility that auc-
aviation
tioned EUAs may likely reach 100% of the emissions cap by
40 2020, from 15% in 2012.
Biofuel

30
One of the solutions to mitigate the financial pressure of the
EU ETS is to use aviation biofuel. Regarded as a carbon neu-
tral fuel, airline operators do not have to buy EUAs for biofuel
20 combustion. Assuming 15% and 30% consumption in 2020
and 2030 respectively, we estimate that biofuel application
can contribute to potential saving of $2.1 billion in 2020 and
10
$5.8 billion in 2030 on carbon credits. This would only be true
if bio jet fuels were the same price as traditional jet fuel.
0

201
0
201
2
202
0
203
0 Currently, second-generation biofuels are very expensive to
Figure. 8 - EU27 aviation CO2 emission and carbon credit implica- produce, but with the price expected to come down as tech-
tions nology and production volumes improve. Given that biofuel
350
would avoid the financial carbon costs associated with tra-
Paid credits (w biofuel) ditional jet fuel, airlines would be willing to pay a price pre-
Paid credits (w/o biofuel) mium at least up to the fuels associated carbon cost savings.
280

The price premium of biofuel varies depending on the price

CO emission (Mt)

Free credits
210
of EUAs. Based on the current EU ETS price for carbon in 2012
of €15 and 2009 average jet fuel price of $1.69 per gallon,
140 every gallon of jet fuel burned would incur carbon costs of an
additional $0.21, which is equivalent to a premium of 12.4%.
70 Table. 6 summarises the price premium of aviation biofuel
calculated using our main assumptions on EUAs and project-
0 ed conventional jet fuel prices. Note that, an increase in jet
201
0
201
2
o bio
fuel) biofuel)
% no b
el)
iofu % biofu
el) fuel prices or a decrease in biofuel prices would cause a de-
0 (n 20 (15 30 ( 030 (3
0
202 2 0 2 0 2 crease in the percentage price premium of aviation biofuel.
Figure. 9 - Fuel and carbon credit expense for EU27 aviation However, only an increase in jet fuel prices would create an
incentive to develop and adopt aviation biofuel.
$200

$160
Credit Cost ($ bn)
2.3 Biofuel and carbon-neutral growth
Biofuel Cost ($ bn)

Jet Fuel Cost ($ bn) As no binding commitments were made in the Copenha-
Expense ($ bn)

$120
gen climate talks, there is no clear prospective for a global
emission trading system for aviation. Despite this, member
$80
airlines of the International Air Transport Association (IATA)
have committed to aggressive goals on emissions reduction.
$40 In June 2009, the IATA pledges to achieve carbon neutral
growth from 2020 and reduce carbon emissions 50% by 2050
$0
compared to 2005 levels. The IATA has indicated that it would
201
0
201
2 fuel) fuel) el) el)
iofu % biofu ral biofu
el) achieve this goal through efficiency improvements, biofuel
o bio % bio no b t
0 (n 20 (15 0
30 ( 030 (3 (C neu
202 2 0 2 0 2
203
0 use and emissions offsets. If emission offset credits were
*Grey section (figure. 7) represents the amount of jet fuel whose cheap enough, the industry could avoid actually reducing its
emissions would need to be offset to achieve the IATA target of emissions, as discussed later in this section.
carbon-neutral growth from 2020.

Other Assumptions

• Projection of jet fuel consumption: 4.1% annual increase [Boe-

ing Aviation outlook 2009-2028]
• Fuel efficiency improvement: 2000 – 2010 = 1.3%; 2010 – 2020
= 1.0%; 2020 – 2030 = 0.5% [estimation used by DEFRA]
• Prjection from EU27 aviation emission 2006 [Source: European
Commission]

11 www.eq2.us.com Managing the Future Today

 insight
Figure. 10 - Projection of 2010 - 2030 jet fuel consumption Figure. 11 - Global CO2 emission and potential emis-
of global aviation industry sion abatement by using biofuel

160 1600

Avoided CO emission
120 1200

CO emission (Mt)
80
800

40
400

0
2010 2020 2030 Low 2030 High 0
(15% biofuel) (30% biofuel) (30% biofuel) 2010 2020 2030 Low 2030 High
(15% biofuel) (30% biofuel) (30% biofuel)
Biofuel

2.3.1 Outlook of global aviation CO2 emissions

According to the estimates generated by he FAST model (UK DEFRA’s Global Atmo-
sphere Division), global CO2 emissions from aviation will reach 860 Mt in 2020 and
will further rise to 1,172 – 1420 Mt in 2030 (see footnote of table. 8). This would be
equivalent to consumption of 89.9 billion gallons of jet fuel in 2020, and 122.5 – 148.4
billion gallons in 2030.

With the same assumption that aviation biofuel consumption will be 15% in 2020 and
30% in 2030, the global aviation industry will consume a total of approximately 13.5
billion gallons of biofuel in 2020 and 36.8 – 44.5 billion gallon in 2030. This would lead
to a reduction of 129 Mt CO2 emissions in 2020 and 352 – 426 Mt in 2030.

2.3.2 How much biofuel does the aviation industry need in order to
achieve carbon neutral growth from 2020?

EU
If the commitment of carbon neutral growth from 2020 is achieved entirely by avia-
tion biofuel utilization, the level of biofuel penetration needs to be even higher than
Air Transport Action Group (ATAG)’s targets. Assuming that aviation CO2 emissions will
be capped at 2020 levels, we estimate that the EU aviation industry alone will require
around 14 billion gallons of biofuel in 2030 in order to achieve carbon neutral growth

Table. 7 – Fuel consumption and CO2 emissions implications of biofuel consumption for global aviation industry

Low High

2010 2020 2020 2030 2030 2030 2030

Biofuel - - 15 - 30 - 30

61.03 89.88 89.88 122.48 122.48 148.40 148.40

(bn gallon)
- - 13.48 - 36.75 - 44.52
gallon)
Total CO2 emissions (Mt) 584 860 731 1172 820.4 1420 994
CO2 emissions avoided by
- - 129.00 - 351.60 - 426.00
biofuel (Mt)

12 www.eq2.eu.com Managing the Future Today

 insight

Low High
2020 2020 2030 2030 2030 2030 2030 2030
Biofuel Biofuel
15% 30% 30%
Scenario - - carbon - carbon
biofuel biofuel biofuel
neutral neutral
Biofuel
- 15% - 30% 38% - 30% 49%

Total (maximum)
expense on fuel & $337.85 $337.85 $653.04 $653.04 $653.04 $794.06 $794.06 $794.06
EUA ($ bn)
EUA expense ($
$27.55 $20.00 $86.11 $47.43 $37.60 $113.39 $66.53 $37.60
bn)
Total biofuel cost
- $54.09 - $218.03 $273.47 - $264.16 $427.25
($ bn)*
EUA expense :
8.16% 5.92% 13.19% 7.26% 5.76% 14.28% 8.38% 4.73%
total fuel cost (%)
EUA expense :
2.85% 2.07% 4.61% 2.54% 2.02% 5.00% 2.93% 1.66%
expense (%)
Table. 8 – Cost implication and benefit associated with EU ETS compliance
*Total operating cost is calculated based on the assumption that total fuel expense account for 35% of the total operating
cost. [Source: Boeing, IATA]

Other Assumptions

• Assumed emission cap used is 457.9 Mt, 95% of 2005 level

• CO2 emission forecasts are taken from “Allocation of international aviation emissions from scheduled air traffic - future
cases, 2005 to 2050 (final report to DEFRA global atmosphere division)” and the 2030 High (FAST-A1) and Low (FAST-B2)
emission forecasts is generated by the FAST model. FAST model is a global aviation inventory model that general projec-
tion using external data on projections of revenue passenger km (RPK).

solely on biofuel. That would be 8.8 billion gallons more than we estimate with a biofu-
el market penetration of 30%, and will be equivalent to 40% of total fuel consumption.

Global
We estimate that the entire industry will need to use 46-72 billion gallons of biofuel
in 2030 globally in order to achieve the carbon neutral growth target entirely with
biofuel. That is equivalent to about 38-49% of total jet fuel consumption in 2030. This
level of biofuel consumption in the aviation industry is very unlikely to happen in 2020
or 2030 due to current biofuel production constraints.

2.4 Global emissions trading for aviation

Accounting for 2-3% of global CO2 emissions, aviation is a significant contributor to an-
thropogenic global warming. This percentage is likely to increase due to the growth of
aviation industry and efficiency improvements of other sectors. EQ2 believes there will
be a significant possibility that aviation will be included into a global emission trading
mechanism.

In this section, we estimate the emissions and cost implications if the entire global avia-
tion industry is to be included into an emission trading system. Most of the assump-
tions for this estimation will remain the same as the ones listed above. Additional or
altered assumptions are listed below table 8.

13 www.eq2.us.com Managing the Future Today

 insight

Without using any biofuel, we estimate that carbon expenses will be $27.6 billion at
15% auctioned credit level (2020), and $86.1 - $113.4 billion at 50% auctioned credit
level (2030) for the global aviation industry. By using biofuel, the expense on carbon
credits can be greatly reduced, with the corresponding expense on biofuel increasing if
the aviation industry needs to pay a premium price for biofuel.

2.5 Aviation biofuel as a competitor to conventional jet fuel

Reaching 15% and 30% of utilisation, aviation biofuel will be a direct competitor to
conventional jet fuel and is likely to directly affect the price of conventional jet fuel.
According to Hileman et al. (2009), each additional 1 million barrels of alternative fuel
supply is estimated to cause a reduction of 0.6% to 1.6% of world oil prices, and this is

Can the cost of carbon credit be passed onto consumers?

One of the main concerns of the aviation industry is whether they can pass their car-
bon credit expense to customers through ticket prices. In order to maximise profit-
ability, the aviation industry would try to pass all of its carbon credit expense onto
customers. They may even attempt to increase prices for the freely allocated credits
and reap ‘windfall profits’, as done by the electricity sector in the first phase of the
EU ETS. However, the airline’s ability of passing through the credit cost is limited by a
number of factors.

First, the proportion of cost they can pass through is determined by type of journey
and the cost sensitivity of the customer. For leisure journey, airlines are not likely to
be able to pass the cost through to the customer as they are very cost sensitive and
they look for the cheapest offer available. On the other hand, airlines are more likely
to pass the cost onto business trip tickets and freight transportation. These customer
groups are less price sensitive and airline can pass more than 100% of the credit price
to them1.

Another factors that determine the proportion of pass through is competition. An Enrst
& Young report, suggests that at uncongested airports, pass-through rate lies between
50% to 100% of the total credit cost. While at congested airports with high competi-
tion, no carbon credit expenses can be passed through to consumers. As the demand
for air transport is anticipated to increase, the level of competition will only increase
and that would further curtail the market power of airlines.

However, from a quantitative perspective, the potential ticket price increase associat-
ed with carbon credit price is limited. According to the EU’s estimation2, even if airlines
fully pass on these extra costs to customers, by 2020 the ticket price for a return flight
within the EU could rise by between €1.80 and €9.
While the industry may be able to pass along some of its carbon costs to consum-
ers (even more than its own costs on certain segments, initially), we believe that the
aviation industry will still have to absorb significant costs from paying for its carbon
emissions.

Footnote:

1. Department for Environment, Food and Rural Affairs (2007), A Study to Estimate Ticket Price
Changes for Aviation in the EU ETS: A Report to Defra and DfT
2. Ernst & Young, & York Aviation (2007), Analysis of the EU Proposal to Include Aviation Activi-
ties in the Emissions Trading Scheme

14 www.eq2.eu.com Managing the Future Today

 insight

independent on fuel production location and fuel consumption purpose. Based on the
same penetration assumption, we estimate that global aviation biofuel production will
be 0.88 million barrels per day in 2020 and about 2.40 to 2.90 million barrels per day in
2030. That implies the potential downward price pressure of aviation biofuel on world
oil prices will be about 0.53% to 4.64%. Therefore, there is a fair possibility that future
aviation biofuel prices likely could be lower than our estimation.

2.6 Biofuel vs. Carbon offsetting

Our estimate for the price premium of Bio-SPK is based solely on industry fuel expens-
es and carbon prices. However, in reality, the price premium of aviation biofuel is not
determined entirely by the price of carbon credits. The aviation industry can achieve
its goal of carbon neutral growth through carbon offsetting. As noted, if carbon offset
credits are cheap enough, the financial incentives for using aviation biofuel would be
negatively affected. In reality, carbon offsets have always been cheaper than EUAs
(particularly depending on the quality of the carbon offset), which in theory would
exert more downward pressure on the price of aviation biofuel.

We would not recommend using carbon offsetting as a method to mitigate a com-

pany’s environmental footprint because this would not would not reduce its climate
risk exposure or improve sustainability in the long term. Moreover, it is suggested that
40% of the additionality (offsetting programs that actually reduce CO2 emissions on
top of business-as-usual scenario) of registered offsetting program are “unlikely” or
“questionable” 1. Since the public is sensitive to “greenwash” actions, airlines should
not put their brand reputation at stake. Most importantly, the aviation industry should
put its focus and investment on developing a sustainable business model, rather than
short-term treatments. The failure to develop sustainable business models could lead
to drastic consequences and lessons should be learnt from the recent decline in the
auto industry.

3. Bio-SPKs – the future of aviation fuel?

In 2008, venture capitalists invested a total of $680.2 million into US biofuel develop-
ers, including $175.9 million in microalgae. Throughout 2009, airlines have been do-
ing test flights on different bio-SPKs, and Boeing is aiming to obtain fuel approval and
certification in 2010. In December 2009, a core group of Air Transport Association (ATA)
airlines, comprising 15 airlines from the US, Canada, Germany and Mexico signed a
memoranda of understanding with AltAir Fuels LLC and Rentech, Inc for a future supply
of alternative aviation fuel. While Rentech will be supplying synthetic jet fuel derived
from coal or petroleum coke, AltAir Fuels will supply approximately 75 million gallons
per year of aviation biofuel derived from Camelina oils or comparable feedstock.

This action by the aviation industry demonstrates that the recent biofuel test flights are
likely more than just marketing stunts. All of this evidence points towards the prolifera-
tion of aviation biofuel and leads us to the $64 million question: Is biofuel the future
of aviation fuel? This is not an easy question to answer, and it is certainly worth much
more than $64 million.

We have examined the incentives and costs associated with the development of bio-

1
Is the CDM Fulfilling its Environmental and Sustainable Development Objectives? An Evaluation of the CDM
and options for improvement, Schneider, L. (2007)

15 www.eq2.us.com Managing the Future Today

 insight

Figure. 12 - Biofuels demand by type and scenario

Source: World Energy Outlook 2009, Interational Energy Agency (2009)

fuel. We have identified that the biggest incentive for the development of aviation
biofuel is aviation industry’s dependence on crude oil. Such dependence makes the
industry passive and vulnerable to oil price fluctuation. A “drop in” fuel derived from
sustainable source is hugely desirable and will bring about a paradigm shift to the fuel
consumption habit of the aviation industry.

Policies and compliance costs create direct financial incentives for the development
of aviation biofuel. Without any biofuel consumption, we estimated that the carbon
credit expense will cost the EU aviation industry $9.56 billion in 2020. The expense
will rise sharply to about $19.5 billion in 2030, which is equivalent to 11% of the total
fuel cost and 3.6% of total operating cost. Such financial pressure in an industry with
very narrow to non-existent profit margins clearly demonstrates how compliance costs
can have a potent effect on airlines’ energy policies. The same theory can be applied
to the global aviation industry. The International Energy Agency ’s findings (Figure. 10)
suggest that if the world is to commit to stabilise CO2-e concentration at 450 ppm, the
demand for second generation biofuels, including Bio-SPKs, would increase more than
6 fold.

Business Sustainability
Ultimately, the development of Bio-SPKs is all about sustainability.

Financially, Bio-SPKs potentially help aircraft operator to ease their operational burden
by avoiding carbon allowance expenses. However, most important of all, Bio-SPKs pro-
vide a chance for the aviation industry to shift into a truly sustainable business model
by decoupling from the reliance on crude oil, thus departing from the passive position
of being controlled by fossil fuel prices.

Environmentally, as a significant GHG emitter, the aviation industry cannot isolate itself
from the fight against climate change. While aircraft fuel efficiency has increased over
80% from the 1960s through to the 1980s, mainly due to the development of wide-
body and mid-range aircrafts, efficiency improvements have dropped to less than one
percent annually since. Under the aspirational aim of energy-related emissions to peak
by 2020 and stabilising global CO2-e at 450 ppm, changing to renewable fuel is the only
option that the aviation industry can adopt to contribute to this battle against anthro-
pogenic climate change.

16 www.eq2.eu.com Managing the Future Today

 insight

4. References
Air Transport Action Group (2009), Beginner’s Guide to Aviation Biofuel

The Boeing Company (2009), Current Market Outlook 2009 – 2028

Biofuelwatch (2009), Biofuels for Aviation: More Future Land Grabbing and Deforesta-
tion for Agrofuels to Justify Today’s Airport Expansion? http://www.aef.org.uk/down-
loads/Aviation_biofuels_Biofuelwatch_March2009.pdf

Cobbs, R. & Wolf, A. (2004), Jet Fuel Hedging Strategies: Options Available for Airlines
and a Survey of Industry Practices http://www.kellogg.northwestern.edu/research/
fimrc/papers/jet_fuel.pdf

Committee on Climate Change (2009), Meeting the UK Aviation Target – Options for
Reducting Emissions to 2050

Daggett, D.L., Hendricks, R.C., Walther, R. & Corporan, E. (2008), Alternative Fuels, for
Use in Commercial Aircraft, NASA

Department for Environment, Food and Rural Affairs (2007), A Study to Estimate Ticket
Price Changes for Aviation in the EU ETS: A Report to Defra and DfT

Department for Environment, Food and Rural Affairs (2008), A study to estimate the
impacts of emissions trading on profits in aviation

Ernst & Young, & York Aviation (2007), Analysis of the EU Proposal to Include Aviation
Activities in the Emissions Trading Scheme

EUROPA (2009), Aviation and climate change – Consolidated Version of the EU ETS
Directive 2003/87/EC, European Union http://ec.europa.eu/environment/climat/avia-
tion/index_en.htm

Hendricks, R.C. (2008), Alternate-Fueled Flight: Halophytes, Algae, Bio-, and Synthetic
Fuels, National Aeronautics and Space Administration

Hileman, J.I., Ortiz, D.S, Brown, N., Maurice, L. & Rumizen, M. (2008), The Feasibil-
ity and Potential Environmental Benefits of Alternative Fuels for Commercial Aviation,
MIT, RAND Corporation & Federal Aviation Administration

Hileman, J.I., Ortiz, D.S., Bartis, J.T., Wong, H.M., Donohoo, P.E., Weiss, M.A. & Waitz,
I.A. (2009), Technical Report: Near-Term Feasibility of Alternative Jet Fuels, Partnership
for AiR Transportation Noise and Emission Reduction & RAND Infrastructure, Safety,
and Environment

International Air Transport Association (2008), IATA 2008 Report on Alternative Fuels

International Air Transport Association (2008), IATA Economic Briefing: Outlook for Oil
and Jet Fuel Prices, IATA

17 www.eq2.us.com Managing the Future Today

 insight

International Civil Aviation Organization, Putting Aviation’s Emissions in Context http://

www.icao.int/Act_Global/Aviation_Emissions-in-Context.pdf

International Energy Agency (2009), World Energy Outlook 2009

Kanellos, M. (2009), Algae Biodisesl: It’s $33 a Gallon, Greentech media http://www.
greentechmedia.com/articles/read/algae-biodiesel-its-33-a-gallon-5652/

Kinder, J.D. & Rahmes, T. (2009), Evaluation of Bio-Derived Synthetic Paraffinic Kero-
sene (Bio-SPK), Sustainable Biofuels Research & Technology Program, The Boeing Com-
pany

Nygren, E. (2008), Aviation Fuels and Peak Oil, Uppsala Universitet http://www.tsl.
uu.se/uhdsg/Publications/Aviationfuels.pdf

Oilgae Blog (2009), Biofuels Digest released summary of US venture capital investment
in biofuels http://www.oilgae.com/blog/2009/01/biofuels-digest-released-summary-
of-us.html

Owen, B. & Lee, D.S. (2006), Study on the Allocation of Emissions from International
Aviation to the UK Inventory – CPEG7: Final Report to DEFRA Global Atmosphere Divi-
sion: Allocation of International Aviation Emissions from Scheduled Air Traffic –Future
Cases, 2005 to 2050 (Report 3 of 3), Manchester Metropolitan University

Patil, V., Tran, K.Q. & Giselrod, H.R. (2008), Towards Sustainable Production of Biofuels
from Microalgae, Int. J. Mol. Sci., Vol. 9, pp. 1188-1195

Rutherford, D. (2009), Stagnation in Aircraft Efficiency Improvement Highlights Need

for Comprehensive Carbon Dioxide Standards, The International Council on Clean
Transportation

Sims, R., Taylor, M., Saddler, J. & Mabee, W. (2008), From 1st- to 2nd-Generation Bio-
fuel Technologies: An Overview of Current Industry and RD&D activities, International
Energy Agency & Organisation for Economic Co-operation and Development

Wallace, L. & Macintosh, A. (2008) International Aviation Emissions to 2025: Can Emis-
sions be Stabilised without Restricting demand?, Centre for Climate Law and Policy,
The Australian National University

Cover page image: Renewable Fuel and Power, LLC

18 www.eq2.eu.com Managing the Future Today

insight

Report contacts

Max Tam
Research Analyst EQ2
London
Washington
Gregory Elders Boston
Director of Research
ge@eq2.eu.com
enquiries@eq2.eu.com
Steve Burt UK: 0845 371 2520

About EQ2
-

EQ² has developed , an Enterprise Carbon, Environmental and Financial Account-

-
ers and employee teams.

The contents of this report may be used by anyone providing acknowledgement is given to EQ2. The information herein has
been obtained from sources, which the authors and publishers believe to be reliable, but the authors and publishers do not
guarantee its accuracy or completeness. The authors and publishers make no representation or warranty, express or implied,
concerning the fairness, accuracy, or completeness of the information and opinions contained herein. All opinions expressed
herein are based on the authors and publishers judgment at the time of this report and are subject to change without notice

© 2010 EQ2.

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