LINCOLN, Neb. (DTN) -- Archer Daniels Midland is expected to use more than half of its ethanol-production capacity to produce sustainable aviation fuels as part of an agreement made with Gevo, the companies announced in a news release on Monday.
As part of a memorandum of understanding, the companies expect to produce up to 500 million gallons of sustainable aviation fuel at ADM plants. ADM expects to install Gevo technology on dry mill ethanol plants in Columbus, Nebraska; Cedar Rapids, Iowa; and Decatur, Illinois. The plants have a combined production capacity of about 900 million gallons of ethanol.
ADM operates seven ethanol plants in Nebraska, Iowa, Illinois and Minnesota, with a total production capacity of about 1.6 billion gallons.
Sustainable aviation fuel production is a growing market for corn producers. The companies said they plan to launch commercial production of sustainable aviation fuel in the 2025-2026 timeframe.
In September, USDA joined a government-wide sustainable aviation fuels challenge to meet 100% of U.S. aviation fuel demand by 2050.
The initiative was announced during a White House roundtable with U.S. Ag Secretary Tom Vilsack, U.S. Department of Energy Secretary Jennifer Granholm and U.S. Department of Transportation Secretary Pete Buttigieg.
As part of a memorandum of understanding, USDA is expected to provide research, development, demonstration and deployment of technologies to annually produce 3 billion gallons of sustainable aviation fuel by 2030 and advance to 35 billion gallons by 2050.
The companies said in a news release they expect to produce both ethanol and isobutanol. They would then be transformed into renewable low-carbon-footprint hydrocarbons, including SAF, using Gevo's processing technology and capabilities.
Isobutanol is an alcohol used as a raw material for coating resins and paint thinners, and as a solvent.
As part of the agreement, isobutanol is expected to be produced at a proposed new facility in Decatur that would employ ADM's carbon capture and sequestration capabilities.
"The potential conversion of 900 million gallons of ethanol -- more than half of our production capacity -- to serve growing demand for sustainable aviation fuel would represent a major step in the continued evolution of our carbohydrate solutions business to focus increasingly on new, high-growth opportunities," ADM Chairman and CEO Juan Luciano said in a news release.
Demand for sustainable aviation fuel is expected to increase. The U.S. and the European Union have set goals that together would demand about 4 billion gallons of sustainable aviation fuel production in 2030 and more than 45 billion gallons by 2050.
"Our potential customer contract pipeline has grown to over 1 billion gallons," said Gevo CEO Patrick Gruber.
"By working with ADM, who already has committed to reducing their carbon footprint, we have the opportunity to accelerate scale. The technology to convert low-carbon ethanol and isobutanol into SAF by Gevo is well developed and ready for world scale-commercialization."
Gevo uses low-carbon renewable resource-based carbohydrates as raw materials, the company said in a news release, and is developing renewable electricity and renewable natural gas for use in production processes.
Last month, Gevo and Chevron U.S.A. Inc. announced the intent to jointly invest in building and operating one or more facilities that would process inedible corn to produce sustainable aviation fuels. The new facilities would also produce proteins and corn oil.
Through the proposed collaboration, Gevo would operate its proprietary technology to produce sustainable aviation fuel and renewable blending components for motor gasoline to lower its lifecycle carbon intensity. In addition to coinvesting with Gevo in one or more projects, Chevron would have the right to offtake approximately 150 million gallons per year to market to customers.
Todd Neeley can be reached at email@example.com
Follow him on Twitter @DTNeeley
(c) Copyright 2021 DTN, LLC. All rights reserved.