"Partnership for Production"
Michael Huerta, Washington, DC
January 28, 2014
Commercial Aviation Alternative Fuels Initiative (CAAFI) General Meeting and Expo
Thank you,Steve (Csonka,Executive Director of CAAFI), for that introduction. And good morning to everyone. I am delighted to be here today.
Anyone who works in aviation knows that how you deal with the cost of fuel and how you deal with conserving fuel is one of your central problems. At the FAA, we are lending strong support to developing the next generation of sustainable fuels, and to producing them on a mass scale.
Everyone here today is a pioneer of the second century of flight. And the decisions we make today will affect aviation for decades to come. We are transitioning to NextGen and to satellite-based navigation and surveillance. And we’re also embarking on the creation of a whole new jet fuel system that is sustainable and draws from a variety of sources. We are launching a new energy industry.
Visionary thinking is what is needed. And also close collaboration across government and industry. I am encouraged that we will hear from a variety of leaders today. This includes CAAFI industry sponsors Airlines for America and the Aerospace Industries Association, as well as a representative from the airlines and leaders from the Departments of Energy, Agriculture and the Navy.
We all need to work together to create the framework for what will be a sea change in how we fuel aviation. This year’s meeting is focused on commercializing alternative fuels. It is a very real challenge that requires collaboration. We need to scale up for the challenge of producing these amazing new sustainable fuels.
At the turn of the 20th century, mom and pop stores started selling gasoline to owners of new “horse-less carriages” that rolled off Henry Ford’s assembly line. As the number of automobiles grew, the technology for producing and distributing gasoline grew. The petroleum industry was not built over night. It took more than 100 years of investment. We are not going to replace petroleum overnight, so we need to be patient.
But there is no denying the future. And it takes courage to make big changes. Winston Churchill switched the British Navy from coal to oil. It was a strategic decision. It was a forward-looking decision. It was controversial at the time for a country with large supplies of coal and no oil. But it was a bold step towards the future because oil was superior to coal for naval power.
We find ourselves at a similar point now. We have plenty of oil, but the times require us to think strategically and look for cleaner, more secure sources of energy to power our daily lives and commerce.
We’re at an historic time where we can work together to make that happen in aviation.
Innovation has always been the hallmark of aviation. Each generation of aviators and engineers has moved the world of flight forward in ways that were not thought possible.
The work of CAAFI is indispensable in this effort. CAAFI has formulated a strong coalition, and it is thanks to this hard work on the part of many, that we are moving forward.
The FAA is committed to enabling development and use of alternative jet fuels.
These fuels have the potential to save the industry a great deal of money.
Fuel represents as much as 40 percent of an airline’s total expenses, on average.
Consider that last year U.S. airlines spent about $49 billion on jet fuel. That’s $32 billion more than in 2000 even though the airlines consumed almost three and a half billion gallons less.
Even a decrease of 10 cents per gallon could mean an industry savings of $1.7 billion per year.
If we are successful, aviation will benefit because alternative jet fuels will provide supplemental supply and help to cushion petroleum’s price volatility.
Sustainable fuels are also greener, and are crucial to meeting the environmental goals that we have set for NextGen.
Airlines used about 17 billion gallons of jet fuel last year. The FAA’s goal by 2018 is for U.S. aviation to use 1 billion gallons of alternative jet fuel per year. I would be the first to admit this is ambitious. On the other hand, we’ve come a long way in the seven years from CAAFI’s first meeting.
We have proven that drop-in alternative jet fuels are technically feasible and we have a number of additional pathways that may be approved for use very soon. So the challenge we face now is to scale up production. And we need government and industry to continue to come together to make this happen.
We’re starting to see some very positive progress and many airlines are taking a lead.
In June, United Airlines announced a three-year deal with Seattle-based AltAir Fuels. United will buy alternative jet fuels to be delivered to Los Angeles International Airport. The deal involves retrofitting a petroleum refining facility. It was creative in that it shared the risk. This partnership will result in 15 million gallons of alternative jet fuel coming into the fuel supply very soon. The fuel will come from waste oils and will reduce air pollution around LAX. This is great news.
Also this year KLM Airlines conducted regular biofueled flights between John F. Kennedy Airport and Amsterdam’s Schipol. Key support for this effort came from the Port Authority of New York and New Jersey, JFK Airport and Delta Airlines.
And Alaska Airlines, United, Lufthansa, Finnair, Thomson, Interjet, Aeromexico and others around the world have conducted revenue flights with alternative jet fuels.
These flights are educating the public and furthering our understanding about how to integrate these fuels into the fuel supply. They represent the beginning of the industry reaping the benefits of these fuels.
Currently there are seven new alternative jet fuel types that are under evaluation for possible approval by the international standards association – the ASTM International. And a strength here is that these different fuel types can use a diversity of resources as feedstocks. They can use fats and oils, sugar, cellulose, solid waste, and even carbon monoxide and carbon dioxide waste gases from industry. This is exciting! This is hopeful!
The FAA supports performance and operability testing of alternative jet fuels in partnership with industry. We’re doing this through our Continuous Lower Energy Emissions and Noise program (or CLEEN). The testing develops data that advances evaluation of these fuels for approval by ASTM International.
In the past year about a half dozen alternative jet fuels have been tested with FAA support, including alcohol to jet fuels; sugar to synthetic kerosene; direct sugar to hydrocarbon; renewable oil to jet fuel; and jet fuel blended with renewable diesel. We anticipate a number of approvals to occur later this year.
This kind of innovation is happening across the world and is really a global effort. The FAA is working with international partners to further our joint success. In the last couple of years we have signed a number of bilateral cooperative agreements—with Spain, Germany, Australia, and Brazil—to exchange best practices and coordinate our efforts.
Jet fuel initiatives are also underway in the Netherlands; Indonesia; China; and the United Arab Emirates. Some of these initiatives have government sponsors. Some are privately led. Some are public-private coordination efforts. And others are developing a supply chain to produce fuel.
Because of the diversity of conditions in different countries we don’t believe that there will be just one solution. Similarly there is a diversity of possible alternative jet fuel technologies, but they won’t work in all places.
So as we each address the challenges to making this happen, there is a tremendous opportunity to learn from, and support each other. And in the end, as a global industry, anywhere sustainable alternative jet fuels are produced is a benefit to global aviation—so the hope is we will all be successful.
Key to CAAFI’s success thus far has been an unprecedented level of partnership. Partnership between the public and private sectors, between academia and industry and between federal agencies.
Last year, the FAA took a prominent role alongside seven other federal agencies in an interagency working group to develop a national alternative jet fuel R&D strategy for the federal government. Many of you in this room are providing input to that group.
We are grateful for the tremendous efforts of our colleagues across the U.S. Federal government. Here are a few examples of the work that’s going on across government agencies.
· The U.S. Departments of Agriculture, Energy and Defense are leading a $510 million effort to develop first-of-a-kind bio-refineries that will produce alternative diesel and jet fuel through the Defense Production Act.
· The FAA is partnering with the Air Force and the Navy to test novel alternative jet fuels in development.
· NASA is conducting projects to measure the air quality and climate benefits of alternative fuels.
· The National Science Foundation is supporting alternative fuel R&D, and Department of Energy is funding alternative jet fuel conversion projects in the testing stage.
· The Department of Commerce supports standards development. And the U.S. Environmental Protection Agency is examining greenhouse gas benefits of these fuels and including them in Renewable Fuel Standard production incentives.
As I said, earlier, the next big challenge is enabling significant production of alternative jet fuels. And it looks like this will be lead at a state and regional level.
In April former Secretary of Transportation Ray LaHood and Agriculture Secretary Vilsack signed the Farm to Fly 2.0 agreement. Associations representing U.S. airlines, U.S. airports, aerospace manufacturers and business aviation also signed
Farm to Fly 2.0 represents a commitment by the agricultural and aerospace community to combine efforts to build a supply chain to meet our goal of 1 billion gallons of alternative jet fuel in use by military and civil aviation by 2018. That’s about 5 percent of annual fuel use in the U.S. To be successful this will require a farm bill that funds energy efforts.
Last year, FAA established a new university Center of Excellence for Alternative Jet Fuel and Environment --The Aviation Sustainability Center, or ASCENT. It is led by Washington State University and the Massachusetts Institute of Technology. This innovative partnership with academia and industry will help us take environmental and alternative jet fuel technology to the next level.
I’d like to close by offering some words of encouragement.
All this progress would not have been possible but for the hard work of many of you in this room.
These steps in creating and using alternative fuels are important not only to the FAA–they are important to our nation and are a key priority for our President.
Sustainable alternative jet fuels offer benefits for both our environment and our economy. The creation of a new industry – what you are trying to do – is not easy. Innovation on this scale takes time and support. We at the FAA and across the government are committed to stand with you in this.
We need continued collaboration among government, aircraft manufacturers, airlines, airports, researchers and the energy industry. It’s going to take a lot of work from everyone at CAAFI and all stakeholders to move aviation into a new era of fuel efficiency and sustainability.
You are the people who are making this happen. I can’t thank you enough for your hard work and dedication.