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  • Writer's pictureRon Kotrba

Going Rogue

Neutral Fuels’ founder Karl W. Feilder is a rebel with a cause—to keep used cooking oil in the local sector and out of the global SAF market. (Photo: Waleed Shah)

The entire world seems to have accepted sustainable aviation fuel as the most immediate and effective way to cut carbon emissions from the aviation industry. Karl W. Feilder, the founder of Neutral Fuels, thinks otherwise.

The art of debate, at least in America, appears to have been lost to time. The reason for this is people don’t seem to want to listen to alternative viewpoints anymore. There was a time when individuals were capable of hearing the other side of an argument. Listening is the first step to understanding, and understanding other positions is a crucial component in debate. One attempts to understand other points of view in order to counter them with logic or better ideas. The obvious point of debate is not only to “win” and get others to believe what you do, but maybe—just maybe—they too could get you to think differently about an issue. The less conspicuous purpose, or perhaps unintended outcome, of debate is to foster a broader understanding through dialectical discourse.

Biofuel-centric media outlets are not generally known for their investigative techniques or objective journalism. They serve a purpose, which is to advocate for biofuels. It’s a type of reporting called advocacy journalism. Thumb through any biofuel magazine and what you’ll most often see is cheerleading and preaching to the choir. Except in this article.

Broadly speaking, Biobased Diesel™ covers and promotes four specific types of fuels: biodiesel, or fatty acid methyl esters (FAME); renewable diesel, including hydrotreated vegetable oil (HVO) and Fischer-Tropsch synthetic diesel from biomass gasification; sustainable aviation fuel (SAF), which comes in various forms including hydroprocessed fats or oils blended in concentrations up to 50 percent with fossil jet fuel, alcohol-to-jet, and eFuels made from renewable electricity and CO2; and marine biofuel, which is most often either FAME or HVO blended with very-low sulfur fuel oil.

It would be foolish to think everyone producing or promoting these fuels, which compete for feedstock and sometimes market share—with SAF being the only one of these suitable for use in aviation—got along harmoniously with their competitors in the broader biobased diesel space. Biodiesel producers, for instance, have lost market share and feedstock to renewable diesel, not necessarily because renewable diesel is a better fuel. Sometimes policy distortions are the reason the market plays out the way it does. But one man, Karl W. Feilder—a biodiesel producer from the United Arab Emirates—has perhaps become the most outspoken critic of SAF.

Biobased Diesel™ asked Feilder, whose social-media posts lament against a position on SAF the whole world seems to have adopted, to participate in a Q&A in that bygone spirit of fostering broader thinking. We may not always agree. But we can listen and learn, and hopefully achieve greater understanding. Below are the results of this interaction.

Q: For those who may not know you, could you start by telling me about yourself, Neutral Fuels, and its business model?

A: Neutral Fuels celebrated our 10th anniversary in 2021. As the largest producer of biodiesel in the Middle East, we now have three biorefineries in the region—Abu Dhabi, Bahrain and Dubai—and we also have one in Delhi, India. We believe our disruptive approach to the biofuels industry is the only long-term sustainable solution to providing a replacement for fossil diesel—and a drop-in solution at that.

Our philosophy is simple: Biofuels should be produced and used as close as possible to the source of their raw materials, cutting out the aggregators, transporters and middlemen both upstream and downstream, essentially making city-scale biofuel financially viable. By removing upstream and downstream transportation charges and middlemen commissions, the Neutral Fuels model is more than able to match any theoretical financial advantages of mega-scale production. Our closed-loop collection and delivery system adds another layer of financial streamlining.

Being an active participant in local markets gives us local knowledge that leads to other highly significant advantages. These include sourcing directly from the local raw-materials producers to allow for a bidirectional flow of quality and yield data, and the advantage of being able to segregate at source to allow the precise tracking of raw material by providers and optimized production chemistry.

We are actively expanding across Africa and the Middle East, which, according to the United Nations, is currently home to approximately 20 percent of the world’s population and has the fastest population-growth rate. As many of the people living in these countries traditionally have a diet with a high fried-food content, the region is a significant user of cooking oil (UCO).

Feilder says if all the daily UCO from just one of the best-known quick-service restaurants in the UAE were to completely fuel an Airbus A380, like the Emirates plane shown here, the aircraft could fly about 80 miles before running out of fuel.

Q: The world over—governments, airlines, engine makers, aerospace companies, fuel manufacturers and shippers, among others—is embracing and pushing sustainable aviation fuel (SAF). What is your position on SAF?

A: If you took all the daily UCO from just one of the best-known quick-service restaurants in the UAE to completely fuel an Airbus A380, the aircraft could fly about 80 miles before running out of fuel. According to Emirates’ website in April 2022, the airline currently operates 115 of these aircraft and, according to the International Air Transport Association, there are over 5,000 airlines currently registered—so how many more aircraft are there? So, you see how much fuel the aviation industry uses. And don’t forget that UCO is already being used to power the very delivery trucks that deliver the food to those restaurants in the first place.

In 1776, Adam Smith wrote, “The learned ignore the evidence of their senses to preserve the coherence of the ideas of their imagination.” This is exactly what is happening with the aviation industry today. It is unsustainable aviation fuel. All the evidence shows it is not capable of being sustained, as there is an insufficient supply of raw materials globally. The April 2022 Barclays Capital research paper on SAF sums it up well: “Limited sustainable feedstock supplies create competing interests with the global food supply and with the decarbonization of road and marine transports.” The world can choose to use biofuels to decarbonize either the road or marine or aviation industries, but not all three. And with a 20-year head start and existing mega-scale biodiesel facilities already running out of raw-material supplies to satisfy the demand of the road-haulage industry, the evidence is already in plain sight.

It’s not so much a question of how, but rather where raw materials are used, according to Feilder.

Q: Is your position on this the same, whether it’s SAF from UCO, canola oil, animal fats or soybean oil, or is it specifically SAF from UCO that is problematic to you?

A: Since the European Union introduced a biodiesel mandate in 2003, there has been a very well-publicized argument over “food for fuel,” which has translated into complex “Indirect Land Use Change” mathematics, which have only served to muddy the waters. Simply put, it is obscene to suggest that we should be growing crops for fuel while we cannot feed our global population. While many would regard this as “moral sentimentalism,” it is actually a far simpler supply and demand economic statement—globally there is insufficient farming land available to grow all the food we need and, without significant changes to the human diet, it will never be financially viable to divert the produce of that land to fuel rather than food.

The distortions to the “food for fuel” argument caused by political subsidies to the biofuels industry will be increasingly unpopular, as the dramatic direct and indirect effects of climate change increase in severity. As with many examples of the climate-change challenge, these will be global in cause and effect. The current ban on exports of palm-oil products from Indonesia, directly resulting from the financial and supply-chain chaos caused by the Russian invasion of Ukraine, is an obvious example of this.

It will never be morally or economically right to make biofuels from virgin oils. The only sources that come close to balancing global supply and demand are those arising from waste materials—rendered animal fats and fats, oils and greases (FOG) from sewage, industrial byproducts, and waste vegetable oils. And these sources are predominantly already being used to solve climate-change problems created by road transportation.

Q: Some make a marked distinction between standalone SAF plants and large petroleum refiners coprocessing a relatively small portion of biogenic feedstock—a small volume to the oil refiner, but a significant amount to the UCO and bio markets—with petroleum crude or distillate cuts before hydrotreating. How do you view these two different routes to SAF? Is one “better” than the other, and why?

A: None of these production routes is scalable if the raw materials are already being used elsewhere. The only economic solution to this classic supply-and-demand nexus is to pay more for the raw materials, which is arguably the main reason that so-called sustainable aviation fuels are up to five times more expensive than their fossil fuel-derived alternatives—yet another factor that makes them unviable.

Q: Can you specifically address how you view the difference between UCO that goes into SAF production and helps fuel airplanes transporting cargo or people, and UCO that is used for methyl ester biodiesel production and used in ground transport such as trucks? Both modes of transport—heavy-duty ground and air—are largely fueled by petroleum distillates, so why should it matter to people whether this biogenic feedstock goes to one or the other?

A: It is not simply a question of whether the raw materials should be used to fuel trucks or aircraft. With a global limit on the supply of raw-material input, it would be most sensible to promote the most efficient use of these. When considering the problem globally, as we must with any realistic approach to address climate change, the real question is, “Where are these raw materials best used?” It is simply not logical to transport the raw materials halfway around the world to make an allegedly “green” fuel—whether for road or aviation use—when those same raw materials could have been utilized in the very city where they originated without exacerbating climate change in the process.

The road-transport industry, by way of the biodiesel mandates in existence for almost two decades, is already making extremely good use of biodiesel. And with almost 75 percent of the required raw material for the European biodiesel industry being imported— which is about as pointless as it’s possible to be—the proof of the unavailability of the feedstock is already obvious.

Neutral Fuels has gotten more involved in the market of marine biofuel, a blend of its UCO-derived biodiesel and very-low sulfur fuel oil, by partnering with companies in the Middle East and North Africa region.

Q: How would you respond to some who might view your position as self-serving? After all, you have a vested interest in bucking this movement, particularly since UCO supplies are finite and this grand uptake for SAF puts serious upward pressure on UCO pricing.

A: Oh, I definitely have a vested interest—it is as a human being living on the only planet we humans have. And, as an engineer, I know an efficient solution when I see it—it’s why I created one. I’ve been making a difference in this industry since 2009 and if I believed there was a better way to use UCO to solve climate change, I would be doing it. And, as I’ve already explained, the volume of biofuel that aircraft need to make a difference renders biofuel from UCO unworkable.

Q: What is your opinion of so-called eFuels, SAF for instance made not from fats, oils and greases but rather from CO2 and green electricity?

A: I would like to see someone pursuing the viability of eFuels, and every other possibility for a viable option. I’ll make myself available to share the knowledge we’ve gained at Neutral Fuels if it can help in any way, but my main focus remains on a solution that is already making a very significant difference.

Q: SAF is largely considered the only fueling option to help decarbonize aviation today. If this is irresponsible in your eyes, then what other fueling options are commercially available to accomplish this?

A: Before I answer that question, I hope you’ve understood from everything I’ve said that it’s not so much about being irresponsible, but about being unviable with current offerings. As for decarbonizing aviation, I don’t think anyone is paying enough attention to the fact that Covid taught us we can do business very successfully without flying around the world. We need a quantum leap now and if we’re to make a significant difference to climate change, we need to make a significant difference to our behavior.

Q: What is next for Neutral Fuels?

A: Our R&D continues apace. We have accumulated a great deal of useful knowledge over the past decade and we’re very aware of our responsibility to use it wisely for the continued improvement of how we use the planet’s resources. And as I’ve said, we are actively expanding across the Middle East. Our ongoing growth plans are made easy by our city-scale business model. We’re very focused on saving the planet.

Author: Ron Kotrba

Editor, Biobased Diesel™



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