TOKYO -- Japanese engineering company JGC Holdings and petroleum wholesaler Cosmo Oil are commercializing jet biofuel in Japan for the first time, targeting aviation companies that are under pressure to reduce carbon dioxide emissions to meet green credentials, Nikkei has learned.
Biofuels, also called sustainable aviation fuel, are made from waste plastics or biomass such as algae and wood chips.
JGC and Cosmo are planning to use waste cooking oil collected by Kyoto-based Revo International from restaurants and food factories. The companies are planning to start production in 2025 in Osaka.
Total carbon dioxide emissions from raw materials procurement through burning in jet engines is estimated to be as much as 80-90% lower compared to traditional jet fuel. Major airlines Japan Airlines and All Nippon Airways have both already started using SAF, and are set to expand usage in order to achieve carbon neutrality by 2050.
SAF does not reduce emissions to zero, but is widely adopted in Europe and other regions. Commercialization of technologies such as electric airplanes, which emit no carbon dioxide, is expected to take some time.
JGC and others are investing billions of yen to build a factory at Cosmo's oil plant in Osaka's Sakai city to produce up to 30,000 kiloliters of jet biofuel per year. The companies are to get subsidies from the government-backed New Energy and Industrial Technology Development Organization.
The companies will eventually increase the number of factories, to aim for up to 30% of domestic market share. The Japanese government estimates the total domestic market to become as high as 5.6 million kiloliters in 2030.
One of the major hurdles for jet biofuels is their high cost. SAFs are currently at least double the cost of traditional fuels. Japan aims to lower the cost to less than 200 yen ($1.83) per liter, which would match that of traditional jet fuel. Low cost SAF in stable supply would affect the competitiveness of the country's aviation industry.
The International Civil Aviation Organization in 2021 implemented a measure to stop airlines from increasing emissions from 2019 levels. The effort is currently voluntary, but will be compulsory from 2027. Lack of SAF supply in Japan could prevent airlines from landing at Japan's airports.
SAF production is still limited globally, despite the efforts of companies such as Finland's Neste, which already produces the product commercially. According to the International Air Transport Association, total global SAF production is 100 million liters, which is only 0.1% of the aviation industry's total fuel consumption.
JGC and others will mix the jet biofuel with traditional jet fuel at their Sakai plant and ship it to Narita, Haneda and Kansai international airports. Mixing 30,000 kiloliters of jet biofuel by 30-40% would enable about 350 trips to and from Tokyo and London.
In Japan, another company Euglena is aiming to produce about 250,000 kiloliters of jet biofuel and diesel biofuel by 2025. JAL, Marubeni and ENEOS are also looking to start commercial production from about 2028.