Industry Sees Brazil as Global Hub for Clean Jet Fuel

Bloomberg’s Dayanne Sousa and Clarice Couto reported Thursday that “a global push to decarbonize air travel has groups from Big Oil to sovereign wealth funds betting on Brazil to become a top global center for green jet fuel.”

“Brazil is becoming a magnet for investment as countries race to grab a share of what promises to be a fast-growing market, with Shell Plc and Abu Dhabi’s Mubadala Investment Co. considering new sustainable aviation fuel plants in the country. That’s in part because Latin America’s biggest economy is the world’s second-largest producer of ethanol, which can be used to produce SAF,” Sousa and Couto reported. “Agriculture powerhouse Brazil has an abundance of cheap crops to make biofuels, providing the nation a leg up on competitors including the US. Many of Brazil’s supplies also rank better in terms of carbon emissions, key to meeting requirements for SAF production.”

“SAF is one of the few pathways the aviation industry has at its disposal to curb its carbon footprint, which accounts for about 2.5% of global emissions. Interest in green jet fuel is picking up, driven by policy support, particularly in the European Union and the US, but demand far exceeds available supply and is forecast to continue growing,” Sousa and Couto reported. “Ricardo Mussa, chief executive officer of sugar and ethanol company Raizen SA, said Brazil’s ethanol production puts it in a strong position to be a major exporter of SAF.”

‘”For every liter of SAF, we need 1.7 liters of ethanol, so the best place to produce would be in the origin, in Brazil,’ Mussa said at Bloomberg New Economy at B20 in Sao Paulo last week,” according to Sousa and Couto’s reporting.

“Production of green aviation fuel in Brazil has the potential to reach around 50 billion liters (13.2 billion gallons) by 2030 with further investments in agriculture, according to preliminary data from a study carried out by Airbus, LATAM Airlines Group SA and the Massachusetts Institute of Technology,” Sousa and Couto reported. “That’s similar to the US’s potential output, but Brazil is set to be a bigger exporter, with American production being consumed domestically.”

Brazil Already Shipping to U.S. SAF Plants

Bloomberg’s Dayanne Sousa reported in April that “Brazilian company Raizen SA made the country’s first shipment of sugar-cane ethanol to be converted into green jet fuel in a US plant, as competition heats up to supply the nascent market.”

“The sugar and ethanol maker, a joint venture between Shell Plc an Cosan SA, was behind a cargo of ethanol sent to the US in March to be used as feedstock for sustainable aviation fuel (SAF), according to documents seen by Bloomberg,” Sousa reported. “…Raizen confirmed the cargo belonged to the company and that the ship carried ethanol certified for SAF. LanzaJet said in an email that it will be using Raizen’s ethanol at its facility, as well as other sources including ethanol from US corn.”

Why Brazil May Be a Leader

Sousa and Couto reported that “companies and authorities in Brazil expect that SAF made from the country’s ethanol will be more effective than other crop-based alternatives. That’s mainly because of how international standards for cleaning global air travel are being written.”

“According to data by the International Civil Aviation Organization, Brazilian sugar cane ethanol has lower carbon emissions compared to other SAF ingredients such as soybean oil or US corn-based ethanol. That means Brazilian-produced SAF would likely be more efficient in helping airlines reach targets to reduce their carbon emissions,” Sousa and Couto reported. “‘The more demanding the emission reduction plans are, the higher the carbon price, the better positioned Brazil will be,’ said Marcelo Moreira, a partner at consultancy Agroicone.”