Gevo, Scandinavian Airlines System increase SAF offtake agreement to 5 MMgy
Gevo Inc. and Scandinavian Airlines System have signed an amendment to increase SAS’s minimum purchase obligation for sustainable aviation fuel (SAF) to 5 MMgy. Gevo and SAS signed the original fuel sales agreement in October 2019.
Gevo expects to supply SAS with SAF beginning in 2024 from Gevo’s Net-Zero 2 Project for use and distribution in low carbon fuel regions of the U.S. The value of the amended agreement is estimated at more than $100 million over the entire term, including related SAF and environmental credits.
“We expect to ink additional offtake agreements later this year,” said Patrick R. Gruber, CEO of Gevo. “SAS has a vision and plan that it is executing, even in spite of the global pandemic. This additional volume will help Gevo grow its business and hopefully accelerate making real Gevo’s Net-Zero 2 plant.”
Lars Andersen Resare, head of sustainability for SAS, said, “SAS has an ambitious goal in reducing its absolute climate affecting emissions by 25 percent from 2005 levels by 2025. This increase of Gevo SAF will help us to reach at least 20 percent of the SAF needed to reach our emission reductions goal. SAS chooses partners like Gevo that have the vision and ambition to support the aviation industry’s transition to net-zero emission.”
Announced in early 2021, Gevo’s Net Zero projects are being designed to produce energy-dense liquid hydrocarbons using renewable energy and Gevo’s proprietary technology. The first, Net-Zero 1, is expected to be built in Lake Preston, South Dakota.
Gevo expects each Net Zero Project will have the capability to produce approximately 45 MMgy of SAF and renewable gasoline, and at least 350 million pounds per year of high-protein animal feed. Each Net Zero Project is expected to have an anaerobic digestion wastewater treatment plant that is capable of generating enough biogas to run the plant and supply a combined heat and power unit, capable of meeting approximately 30 percent of the plant’s electricity needs. The remaining 70 percent of electricity to run the plant is expected to come from wind power. Net-Zero 1 may also obtain renewable natural gas using manure from dairy or beef cows. These efforts should make this Net-Zero 1 self-sufficient and help ensure it will be off a fossil-based grid. Gevo also believes in transparency and is setting up sustainability tracking methods to work alongside its farmers.