Replacing fossil fuels with cleaner alternatives

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by Jane Foutz

As reported in the Outlook 2020 issue of Resource World, renewable chemical and advanced biofuel company Gevo, Inc. [GEVO-NASDAQ], headquartered in Englewood, Colorado, is developing a product portfolio that replaces fossil-based fuels and harmful chemicals with low-carbon, cleaner alternatives. Gevo is commercializing the next generation of gasoline, jet fuel, and diesel fuel with the goal of achieving zero carbon emissions.

The company is transparent with its sustainability practices and will be using the IBM Corp. [IBM-NYSE] Blocksize Capital blockchain technology to track its sustainable agriculture efforts. Blockchain technology enables everyone involved in a transaction to know with certainty what happened and when it happened. It con-firms all parties are seeing the same thing, without the need for an intermediary to provide assurance, and without the need to reconcile data afterwards.

Gevo’s commercialization process is advancing well. In December 2019, the company signed a Fuel Sales Agreement with Scandinavian Airline System (SAS) to produce and supply sustainable aviation fuel (SAF) for use and distribution in low carbon fuel regions of the United States. With this new supply contract, Gevo will supply SAF to SAS from Gevo’s expanded Luverne, Minnesota plant, which will be constructed over the next several years. Says Dr. Patrick Gruber, Chief Executive Officer of Gevo, “SAS is a pioneer in the use of sustainable aviation fuel, such as launching a new ancillary product that gives travelers the option to reduce their climate impact through the purchase of biofuel when booking a ticket, or at any time before departure. This agreement is another step in that innovative approach to sustainability.”

“SAS has ambitious goals in reducing its climate-affecting emissions by 25% in 2030. To do this and to bridge the gap to future zero emission aviation, we are determined to increase the use of biofu-els,” says Lars Andersen Resare, Head of Sustainability, SAS. “This agreement is yet another important step for SAS transformation toward a more sustainable aviation.”

Gevo’s global fuel supplier, Avfuel Corp. has delivered Gevo’s SAF to Banyan Air Service at Fort Lauderdale Executive Airport (KFXE), Florida, where the com-pany reports that the fuel accounts for a 2-tonne reduction in lifecycle CO2 emis-sions, furthering sustainability goals for Banyan Air Service and Avfuel. The fuel was allotted to operators via commitments prior to its delivery.

“Avfuel continues to work diligently to source, test, blend, and ship Gevo’s SAF, which continues to raise the awareness of SAF. These efforts are important because they show the viability of SAF and express to corporations that they have a choice when flying their corporate jets. This edu-cation shows other fixed-based operators what they provide their customers,” stated Dr. Gruber.

To supply the fuel, Avfuel acquires a concentrated SAF delivery from Gevo and blends it with petroleum-based jet fuel. This mixture is then tested for fuel qual-ity and to ensure it meets all standards associated with jet fuel. Created from corn starch, for every one million gallons of the concentrated SAF that is produced, approximately 10 million pounds of ani-mal feed and protein is sold into the food chain, and the final jet fuel product burns cleaner, reducing carbon emissions released into the atmosphere.

In December 2019, Avfuel began delivering Gevo’s sustainable aviation fuel to business jet manufacturer, Bombardier Inc. [BBD.A, BBD.B-TSX] with administra-tive headquarters in Dorval Québec, for new customer aircraft deliveries in Canada. “We are committed to playing our role in making SAF a reality in the marketplace. One of the best ways to do that at the moment is by demonstrating its use,” said C. R. Sincock, Executive Vice President for Avfuel. Sincock continued, “By capitaliz-ing on opportunities to work with leading OEMs, Avfuel can help business aviation attain its sustainability goals. We appreci-ate Bombardier for its collaboration in this initiative and for our continued partner-ship with Gevo.”

Also in December 2019, Delta Air Lines Inc. [DAL-NYSE] entered an offtake agree-ment with Gevo for 10 million gallons per year of sustainable aviation fuel in the future. “Long-term investments, such as our agreement with Gevo are critical to Delta’s goal to lower our carbon footprint while planning for a more sustainable future,” stated Graeme Burnett, Senior Vice President, Fuel Management at Delta Air Lines. “Fuel is an airline’s biggest area of impact and therefore presents our great-est opportunity to drive solutions that care for the planet.”

The companies expect the sustainable aviation fuel will be produced upon com-pletion of the expansion to Gevo’s existing advanced biofuel production facility in Luverne, Minnesota. Gevo is also part-nering with customers in the Pacific Northwest where the company was first to make and supply wood-based jet fuel for Alaska Airlines in 2016.

In a related 2019 development, Gevo provided the City of Seattle advanced low carbon fuels for their fleet automobiles. “We have such great potential in our busi-ness system to break paradigms as to what is possible. We are working to create a business system that works hand-in-hand with agriculture to improve sustainability and lower the carbon emissions of jet fuel while producing protein for food chain use,” said Dr. Gruber.

HARVESTING THE SUN’S ENERGY FOR COMMERCIAL AND INDUSTRIAL SITES

In February 2020, UGE International Ltd. [UGE-TSXV; UGEIF-OTCQB] announced five new contracts for projects in New York, the Philippines, and Ontario. UGE, a solar energy company, works with the commercial and industrial sectors. The company was founded in 2008 and has dual headquarters in New York City (NYC) and Toronto, and a local office in the Philippines. The company provides options for building owners, such as leas-ing the owners’ roof space. The building owner pays a flat lease, and UGE sells energy to the grid via community solar programs. Clients then buy energy for 20-50% less than utility rates. From cli-ent’s perspective, this means no capital investment and immediate benefit, with UGE managing 100% of project lifecycle.

In New York, UGE and Wildflower Ltd. signed an agreement for a 100 kilowatt (kW) system on a storage facility roof in Holbrook, New York as the latest addition to the relationship between the compa-nies. This partnership enables building owners to earn additional revenue while complying with the Climate Mobilization Act. In this Act, Local Law 94, all new construction in NYC must adopt pre-scribed sustainability measures, which the company believes are best fulfilled by installing rooftop solar energy systems.

In the Philippines, the Cebu Institute of Technology (CIT-U) signed a Memorandum of Understanding with UGE Philippines to officially start contracting for a 97 kW solar energy system for their high school building in Cebu City. UGE’s CEO, Nick Blitterswyk, and CIT-U’s President, Engineer Bernard Nicolas Villamor led the ribbon cutting ceremony at the CIT-U Library Activity Center in February.

UGE Philippines also signed a contract with Lite Properties Inc. for a 200 kW project. The solar system is sized to off-set the electrical load of Lite Port Center,eliminating their exposure to the high electricity rates on Bohol Island. The UGE team, together with Lite Shipping Group President and CEO Lucio Lim, Jr., signed the agreement at the group’s headquar-ters. With all three clients, UGE is actively evaluating additional buildings to add to its 2020 project schedule.

UGE Consulting Services has also signed an agreement to complete the engineer-ing scope of work for a rooftop system in Ontario, which will increase the system’s capacity from 218 kW to 350 kW. This will be UGE’s first project with Wattsavers and its first project in Ontario, a market it expects to see grow in the upcoming quar-ters. UGE Consulting Services also signed an agreement to complete a commercial solar engineering project for a large com-mercial-scale developer in the southwest USA.

Managers expect the above projects to be completed in 2020, with margins in line with the company’s stated goals for each business unit. UGE will finance the CIT-U and Lite Properties projects, while the building owner will self-finance the Holbrook system.


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