An Australian aviation biofuel industry is technically viable but significant obstacles remain, according to a report released by Qantas and Shell today.

The study, conducted with the support of the Australian Government through the Australian Renewable Energy Agency (ARENA), is the most comprehensive investigation so far into the economic viability of producing biofuel on a commercial scale in Australia.

Identifying natural oils as a proven source material, the study modelled a plant capable of producing 1.1 billion litres of renewable fuels, including jet fuel and diesel, per year using existing supply chain infrastructure.

It found that such a plant could be viable if three key priorities are addressed.

1. Feedstock. The volume of natural oil feedstocks available at a competitive price in Australia is not sufficient to power a commercial scale biofuel plant. This volume and price gap has potential to be filled by increased investment, research and development in production of emerging feedstocks such as algae and pongamia.

2. Infrastructure. While existing brownfield refining locations could be used for producing aviation biofuel, new infrastructure would be required, with associated capital costs.

3. Policy. Extending biodiesel production grants that currently apply to biodiesel to bio-jet fuel would go a long way to making a commercial plant viable.

Qantas’ Head of Environment, John Valastro, said the report gave a clear picture of the actions required to make regular biofuel flights a reality in Australian skies.

“Aviation biofuel is the only technology capable of delivering the generational change required for the aviation industry to meet its ambitious target of a 50 per cent reduction in carbon emissions by 2050,” Mr Valastro said.

“It’s well-established that certified biofuel can be used safely in commercial flights. Qantas’ focus now is on making it a viable alternative to conventional jet fuel. It won’t be easy, but we are armed with a stronger and more detailed understanding than ever before of all aspects of the biofuel supply chain.

“The next step for Qantas is to work closely with our partners to find ways of increasing the supply and reducing the cost of aviation biofuel feedstocks in Australia – one of the major obstacles that need to be addressed.

“At the same time, we will be talking to governments about the importance of a supportive policy environment for biofuel production, given its potential to create jobs and open up new opportunities in the agriculture sector and regional Australia.”

Shell Australia’s Vice President Downstream, Scott Wyatt, said Shell Australia was proud to be involved in the research.

“While the establishment of an aviation biofuels industry might not appear viable in the short term, innovative research on supply chains will help inform future decisions,” Mr Wyatt said.

The Qantas-Shell study looked only at certified biofuel production methods already approved for use in commercial aviation, and which meet strict operational and environmental criteria.

As well as natural oil-based fuel production pathways, Qantas worked directly with Solena Fuels to assess the opportunities around a waste-based pathway, which shows promise but also faces commercial challenges.

In addition to Qantas and Shell, a number of other companies with relevant expertise took part, including Sinclair Knight Merz, SkyNRG, AltAir Fuels, Solena Fuels and the Australian Research Council.