HEFA+ for Aviation

WORKING PAPER 2018-06

Policy and Environmental Implications of Using HEFA+ for Aviation

Authors: Nikita Pavlenko, Anastasia Kharina Date: March 21, 2018 Keywords: Green Diesel, HEFA+, Alternative Jet Fuels, AJF

Introduction is a synthetic hydrocarbon typically impacts of aviation. We first evaluate made from bio-feedstocks such as the production of HEFA+ and the The aviation sector must confront vegetable oil or waste fats. HEFA+’s impact of feedstock choice on HEFA+’s rapidly increasing greenhouse gas primary competitive advantage stems sustainability and GHG performance. (GHG) emissions and ambitious decar- from its similarity to renewable diesel The next section analyzes the state of bonization targets. The International [also known as hydrogenated veg- HEFA+’s deployment and estimates Civil Aviation Organization (ICAO), the etable oil (HVO) or hydrogenation- the near-term availability of HEFA+. United Nations agency charged with derived renewable diesel (HDRD)], a The final section discusses the policy coordinating international standards biofuel already produced at commer- implications of expanding HEFA+ use for civil aviation, projects that the cial scale for the road sector. Existing in the aviation sector and competition greatest share of in-sector GHG reduc- production of renewable diesel for the for feedstocks with the road sector. tions from aviation will come from road sector dwarfs the scale of pro- transitioning away from petroleum- duction of other potential jet fuel sub- based jet fuel toward sustainable, low- stitutes; production could theoretically Production and Processing carbon alternative jet fuels (AJFs). The ramp up quickly at existing facilities. If HEFA+ production resembles the pro- AJFs that may replace petroleum in HEFA+ were to be certified as an AJF, duction of renewable diesel for the the future can vary widely in feed- it would therefore immediately have road sector, a process wherein veg- stocks used, cost, and environmental a market advantage relative to other etable oils, waste oils, and fats are pro- performance. These factors must all be AJFs that are further from commer- cessed into hydrocarbons. Renewable taken into consideration when devel- cialization. Proponents of HEFA+, such dieselis chemically different from tra- oping fuels policies for the aviation as Neste Corporation, tout the high ditional biodiesels produced for the sector if its carbon emissions are to be technological readiness and relatively road sector, which are produced via successfully reduced. low price of HEFA+ relative to other trans-esterification to generate fatty AJFs; this suggests that, once certi- acid methyl esters (FAME). FAME- To facilitate the transition to AJF, fied, substantial volumes of HEFA+ Boeing has begun testing the technical could be used in the aviation sector in based biodiesels may cause problems suitability of HEFA+ (Hydroprocessed the near term (Erämetsä, 2017). in some engines at high concentrations Esters and Fatty Acids+) on flights as and thus require blend limits in the road a petroleum jet fuel substitute. HEFA+, This study assesses the state of HEFA+ sector; they cannot be used in aviation commonly called “green diesel” or deployment within the aviation sector because of substantial chemical dif- high-freeze-point HEFA (HfP-HEFA), and its potential to reduce the climate ferences from petroleum-based jet

Acknowledgements: We thank Dr. Michael Lakeman, Associate Technical Fellow on Biofuels Strategy at Boeing Commercial Airplanes, who graciously provided his time to discuss Boeing’s endeavor in testing and certifying HEFA+ as AJF. We also thank Dr. Stephanie Searle and Dr. Daniel Rutherford for their guidance and thorough review. This study was funded through the generous support of Environment and Climate Change Canada.

fuel (Zeman, 2010). In contrast, the Food Crops: Waste Feedstocks: H2 renewable diesel production process Soybean Oil, Used Cooking Oil, Canola Oil, Animal Fats, converts bio-oils into a chemical form Palm Oil PFADs, Tall Oil more similar to fossil fuels, thus facil- itating higher blending with petroleum-based diesel. The first step in Feedstock Feedstock Hydro- Production renewable diesel production (Figure Deoxygenation Production Pre-Treatment isomerization Separation 1) is bio-oil treatment with hydrogen gas and a catalyst in order to remove oxygen (i.e., hydrotreatment). Once H O, Acid GasGreen the oxygen is removed, the remaining 2 Diesel hydrocarbon chains are then hydroi- somerized to break down the long Hydroprocessing chains and improve the cold flow Light End properties of the finished fuel. The end product generally contains hydro- Figure 1. Flow diagram of renewable diesel production process. carbon lengths in the diesel range, Source: Derived from Honeywell UOP (n.d.) although further hydroisomerization (i.e., those with shorter carbon chains) of D7566 relative to traditional HEFA can break down the chains of carbon produced by the biorefinery, such (Starck et al., 2016). Therefore, HEFA+ even further, thereby increasing the as naphtha and propane (Landälv & testing has occurred at blend rates of share of bio-kerosene (Landälv & Waldheim, 2017; Starck et al., 2016). 15%—substantially less than the 50% Waldheim, 2017). These light compounds cannot be blends allowed for traditional HEFA HEFA+ production closely resembles included in finished jet or road fuel, fuel in road transport (Erämetsä, 2017; the AJF pathway for Hydroprocessed so reducing their share of the product Radich, 2015). Esters and Fatty Acids (HEFA). stream raises the overall value of fuel production by increasing the yield of Traditional HEFA fuel was already cer- Deployment tified by ASTM International in 2011, transport fuel relative to lower-value meeting ASTM’s Method D7566 , the materials. To produce HEFA+, manu- CERTIFICATION TIMELINE “Standard Specification for Aviation facturers can instead alter the HEFA Turbine Fuel Containing Synthesized process to reduce the intensity of the At the time of writing, HEFA+ is under- Hydrocarbons,” at blend levels of 50% hydroisomerization stage of hydro- going a rigorous research process to or below (Wang et al., 2016). A re- processing, leaving longer hydrocar- acquire the ASTM certification D4054 identification provision within ASTM bon chains more similar to diesel than “Standard Practice for Qualification D7566 states that AJF blends meeting to kerosene. and Approval of New Aviation Turbine all the requirements of D7566 also Fuels and Fuel Additives.” The mul- Decreasing the yields of light com- meet the requirement of ASTM D1655 tistage process involves aircraft and pounds reduces the cold flow prop- “Standard Specification for Aviation engine manufacturers and requires Turbine Fuels” and can be regarded as erties of the finished fuel relative to up to 890,000 liters of blended jet conventional fuels (ASTM International, traditional HEFA. The reduced cold- fuel to complete (Rumizen, 2013). The 2016; IATA, 2012). Therefore, at the weather performance for HEFA+ is certification process can be lengthy, as blend levels specified in a given fuel’s likely not a factor in most on-road it requires consensus from all original D7566 Annex, that fuel is considered a uses but takes on greater importance equipment manufacturers (OEMs) that “drop-in” AJF. in aviation, where jet fuel specifica- produce airframes or engines before tions for Jet A and Jet A-1 require a moving to the next stage of approval Producing traditional HEFA fuels maximum freezing point of –40°C (M. Lakeman, personal communica- requires additional hydroisomeriza- and –47°C, respectively (Starck et al., tion, January 24, 2018). As part of tion beyond that needed to produce 2016). The unblended or “neat” HEFA+ data collection, Boeing, in collabo- renewable diesel, as kerosene has a has a higher freezing point than tra- ration with the U.S. Federal Aviation shorter chain length than diesel. As ditional HEFA fuels, thus requiring a Administration (FAA) and engine the chains shorten, the process also greater share of petroleum-derived manufacturers, has conducted flight creates low-value light compounds fuel in order to meet the specifications tests onboard its ecoDemonstrator

2 INTERNATIONAL COUNCIL ON CLEAN TRANSPORTATION WORKING PAPER 2018-06 POLICY AND ENVIRONMENTAL IMPLICATIONS OF USING HEFA+ FOR AVIATION

787 flight test airplane, using a blend 500 million liters of capacity under carcass and has lower value than meat; of 15% green diesel and 85% petro- construction (Wang et al., 2016). a farmer will thus decide whether to leum jet fuel in one engine (Boeing, Canada imports its renewable diesel, increase or decrease livestock produc- 2014). The final blending allowance for with zero domestic capacity in 2016 tion based on the price of beef rather HEFA+ in the ASTM standard is to be (Dessureault, 2016). Existing renewable than the price of tallow, which has a determined through further testing. diesel production in North America smaller impact on profits. We may would displace only 2% of U.S. and expect the supply of tallow to increase If approved, HEFA+ would be included Canadian jet fuel demand (approxi- if total beef production increases, but as an annex of ASTM D7566. Once the mately 72 million liters in 2017) (BTS, it will not change as a result of biofuel certification process is complete, the 2018; U.S. EIA, 2018). policies. Figure 2 shows current total blended fuel would be ready for use on production of major types of waste commercial flights and could easily be In the EU, the majority of renewable and residual HEFA+ feedstocks in the integrated into common fuel delivery diesel production comes from waste United States and Canada. This figure systems at airports. Integrating alterna- feedstocks such as used cooking oil shows the breakdown of feedstock use tive fuels into operations is a relatively and animal fats, as the industry transi- in biodiesel versus other uses, including simple process, as illustrated by United tions away from palm oil because of livestock feed and industrial products Airlines’ use of HEFA fuels. AltAir Fuels environmental concerns (Flach et al., (data on feedstock use in renewable has successfully delivered blended 2017). Neste, a leading proponent of diesel or other types of biofuel are not fuel to the Los Angeles International HEFA+ and Europe’s largest producer available). Also shown is the maximum Airport fuel farm, where it is mixed of renewable diesel, generated about share of U.S. jet fuel consumption with conventional jet fuel from other 80% of its renewable diesel from that could be supplied by HEFA+ if providers instead of directly to United’s waste fats and oils and the remain- the entire supply of these feedstocks aircraft via a dedicated delivery system der from crude palm oil (Flach et al., were used for this purpose. Waste and (Kharina & Pavlenko, 2017). 2017). The waste feedstocks used by residual fats and oils could supply as Neste include palm fatty acid distil- much as 7% of total jet fuel demand in Currently, it is uncertain when HEFA+ lates (PFADs), an oily by-product of the United States and Canada. will be available for airlines. Past the palm oil manufacturing process. In reports indicate a typical timeline of North America, Diamond Green Diesel However, we emphasize that divert- 3 to 5 years for certification (Colket et and AltAir, the two largest renewable ing 100% of waste and residual fats al., 2016, and Csonka, 2016). Although diesel producers, primarily make use and oils to biofuel production would the process to certify HEFA+ has been of waste feedstocks such as animal be neither practical nor environmen- ongoing for several years, it is difficult fats and used cooking oil (Lane, 2017). tally beneficial. Drastically increasing to predict when it will be completed Diamond Green Diesel has also made the demand for these materials would (M. Lakeman, personal communica- use of inedible corn oil, a by-product sharply increase their prices, which tion, January 24, 2018). of corn ethanol production, to manu- would lead to substantially higher facture its renewable diesel (CARB, overall costs for HEFA+. The environmental impacts of increasing the use AVAILABILITY ASSESSMENT 2017a). Although much existing production of renewable diesel comes of waste oils and fats in HEFA+ are HEFA+ is currently available only in from wastes and by-products, this described below. small volumes for testing, whereas does not guarantee that future produc- renewable diesel for the road sector tion in response to increased demand ENVIRONMENTAL is already being produced at a com- would come from those sources. mercial scale. Global renewable diesel PERFORMANCE production capacity is approximately There is limited potential for expand- Producing synthetic diesel from veg- 6 billion liters (4.7 million tonnes) as ing the production of HEFA+ by divert- etable oils and waste fats avoids some of 2017, with the majority (4.5 billion ing waste oils and fats from other of the impurities found in crude oil that liters) located in the EU (Flach, uses. The supply of waste feedstocks generate air pollution upon combus- Lieberz, & Rossetti, 2017; Greenea, such as used cooking oil, animal fats, tion, such as sulfur. Relative to petro- 2017). Renewable diesel capacity in tall oil, and PFADs is fixed and will leum diesel, renewable diesel used North America is substantially smaller, not increase with demand for these in the road sector has been found to with only 1 billion liters of produc- wastes. For example, tallow repre- produce equivalent or lower criteria tion capacity in 2016 and another sents a small fraction of an entire cow air pollutant emissions. For example,

WORKING PAPER 2018-06 INTERNATIONAL COUNCIL ON CLEAN TRANSPORTATION 3 POLICY AND ENVIRONMENTAL IMPLICATIONS OF USING HEFA+ FOR AVIATION

the California Air Resources Board U.S. biodiesel U.S. other products Canada biodiesel finds that relative to petroleum diesel Canada other products Potential share of total jet fuel demand exhaust, renewable diesel exhaust 3500 5% contains less particulate matter (PM), 3000 NOX, and carbon monoxide (California 4% EPA, 2013). Preliminary testing by 2500 Boeing indicates that the reduction 3% in soot formation with fuels like HEFA 2000 and HEFA+ may deliver benefits for 1500 2% aircraft, reducing the maintenance requirements for the engines (M. 1000 Lakeman, personal communication, 1% 500 January 24, 2018). Potential share of total jet fuel Thousand tonnes feedstock use 0 0% The carbon intensity of HEFA+ can Used cooking oil Animal fats Inedible corn oil Tall oil vary widely depending on the choice of feedstock used for production. Figure 2. Total feedstock production and use of potential HEFA+ feedstocks, and HEFA+ can be produced from a wide maximum potential production of HEFA+ from these feedstocks, as a share of total jet variety of fatty feedstocks, includ- fuel demand in the United States and Canada. ing virgin vegetable oils made from Sources and assumptions: Quantities used in U.S. biodiesel production in 2015 from U.S. EIA (2017); oilseeds such as soy and palm, as quantities in U.S. non-biodiesel uses for used cooking oil, animal fats, and inedible corn oil from Nelson and Searle (2016); U.S. tall oil production from Peters and Stojcheva (2017); quantities used in well as waste oils and fats such as Canadian biodiesel production in 2016 from Dessureault (2016); total animal fats production in Canada used cooking oil and inedible animal from FAO (2018); Canadian tall oil production estimated to be proportional to production in the United tallow. The carbon intensity of the States by total revenue of each country’s pulp and paper industries; Canadian non-biofuel uses of inedible corn oil assumed to be zero following Nelson and Searle (2017); Canadian non-biofuel uses finished fuel includes both direct and of used cooking oil assumed to be zero because the quantity used in Canadian biodiesel production indirect emissions. exceeds the supply of collected U.S. used cooking oil on a per capita basis.

Direct emissions for HEFA+ produc- which are approximately 20 gCO2e/MJ‌ substitute materials. For example, used tion are primarily attributable to the for soybean oil–derived renewable cooking oil has historically been used fuel production and processing phase diesel and 15 to 20 gCO2e/MJ for used in livestock feed in the United States and are comparable across different cooking oil–derived renewable diesel. (Nelson & Searle, 2016). Diverting it feedstocks. Because of the similar- In comparison, the baseline well-to- to biofuel production reduces the fat ity in production methods between wake (WtWa) emissions for petro- content and overall quantity of live- renewable diesel for the road sector leum-based diesel are approximately stock feed. Livestock farmers must thus replace it with another oil or fat, and HEFA+ for aviation, we can refer- 90 gCO2e/MJ (Elgowainy et al., 2012). ence lifecycle assessments of renew- such as palm oil. This increases the Many feedstocks can also generate able diesel to understand the climate overall demand for palm oil and drives indirect emissions from outside their impacts of HEFA+. For example, the expansion of palm oil production. Using GHGenius Model estimates a lifecy- immediate production process. The wastes and residues that have existing use of land-based crops, including all uses for HEFA+ production will thus cle emission factor of 18.0 gCO2e/‌MJ types of food commodities, for biofuel necessarily result in increased emis- and 12.7 gCO2e/MJ for renewable diesel produced from canola oil and causes indirect land-use change sions from the production of additional yellow grease, respectively ((S&T)2 (ILUC) emissions, as the increased crops and the land-use change emis- Consultants, 2012).1 These values are demand for these commodities drives sions associated with their expansion roughly comparable to the direct land conversion beyond the cropland (see Figure 3). emissions for certified renewable directly used for feedstock cultivation. Taking indirect emissions for HEFA+ diesel pathways within California’s The use of waste oils and fats for biofuel into account can substantially change Low-Carbon Fuel Standard (LCFS), production can generate indirect emis- our understanding of the GHG benefits sions. Diverting waste oils and fats of this fuel relative to petroleum jet 1 Assuming a renewable diesel density of 770 g/liter and a lower heating value (LHV) of from other uses may lead to increased fuel. For some feedstocks, indirect 44.1 MJ/kg. production of virgin vegetable oils as emissions can undermine the supposed

4 INTERNATIONAL COUNCIL ON CLEAN TRANSPORTATION WORKING PAPER 2018-06 POLICY AND ENVIRONMENTAL IMPLICATIONS OF USING HEFA+ FOR AVIATION

GHG reductions attributable to fuel Indirect emissions Direct emissions Petroleum Baseline switching. Previous ILUC estimates 200 for oilseeds suggest a wide range of 180 possible values. In particular, palm 160

oil–derived fuel generates high ILUC e/MJ) 2 emissions because a large share of 140 oil palm expansion occurs on drained 120 peatlands and high-carbon forestland in Southeast Asia. ILUC estimates 100 conducted in support of Europe’s 80 Renewable Energy Directive (RED) and California’s LCFS indicates that ILUC 60 from palm oil–derived fuels can push 40

their overall carbon intensity above that Life-cycle emissions (gCO 20 of baseline petroleum diesel fuel (see Figure 3). ILUC modeling suggests that 0 Canola Soybean Palm Canola Soybean Palm Animal Palm fatty palm oil may be a substitute for other oil oil oil oil oil oil fats acid distillate vegetable oils when they are diverted (PFAD) for biofuel production. Diverting crops GLOBIOM CARB Non-ILUC indirect emissions (Malins, 2017) such as soy and canola for biodiesel causes some additional palm planta- Figure 3. Impact of indirect emissions on carbon intensity of renewable diesel for several tion expansion because it is often the different feedstocks. lowest-cost alternative; this relation- Note: the partially-shaded columns reflect preliminary indirect diversion emissions estimates from ship drives up the ILUC emissions for all Malins (2017), rather than ILUC values developed to inform fuels policies. oilseed-derived biofuels. Source: Direct emissions values (in brown) taken from GHGenius ((S&T)2 Consultants, 2012); indirect emissions values taken from CARB (2018), Malins (2017), and Valin et al. (2015). Indirect diversion emissions estimates from Malins (2017) include upstream production emissions, land-use change, Policy Implications forest carbon debt, and fossil fuel emissions. Manufacturing renewable diesel may Reduction Scheme for International to establish policy incentives for AJFs be cheaper than producing jet fuel Aviation (CORSIA), where alter- (ICAO, 2017a). from sugars or lignocellulosic feed- native fuels are part of a basket of stocks, but it is still reliant on policy measures eligible for meeting ICAO’s Several countries are considering incentives and subsidies for its viability. GHG target of carbon-neutral growth. incentivizing AJFs through a variety of On the basis of the draft Standards policies. In North America, the primary AJFs are still more expensive to produce and Recommended Practices (SARPs) policy incentive for AJF production than conventional fossil fuels, although released for State consultation, it is the U.S. Renewable Fuel Standard the price gap has narrowed in recent is likely that HEFA+ fuels would be (RFS). The RFS supports AJFs on an years for some fuels (M. Lakeman, eligible for crediting within CORSIA, “opt-in” basis, wherein they can be personal communication, January 24, although the extent of the GHG reduc- produced in order to generate renew- 2018). The policy context of where AJFs tions generated would depend on the able identification number (RIN) are produced is critical to determining feedstock used (ICAO, 2017b). It is still credits, but aviation is not an obligated the cost-effectiveness of fuel switching; highly uncertain how strong of a price sector (U.S. EPA, 2010). This means some renewable diesel producers in the signal CORSIA will send for alternative that while aviation fuels can qualify United States have begun to approach fuels, as out-of-sector carbon offsets for RINs, aviation fuel suppliers are the cost of conventional fuels after fac- are likely a much cheaper source of not obligated to meet RFS quotas toring in the value of policy incentives GHG reductions (Pavlenko et al., 2017). on fuel blending. RINs are tradeable (Kharina & Pavlenko, 2017; Lakeman, credits that demonstrate compliance personal communication). ICAO has also introduced a separate alternative fuel goal; however, it is with the RFS; AJF producers can sell ICAO is in the process of developing a broad and aspirational. In the absence them to obligated parties such as fuel methodology for crediting fuel switch- of a specific volumetric target or blenders and refiners to supplement ing through its Carbon Offsetting and incentive, it is up to member states their income. RINs are categorized

WORKING PAPER 2018-06 INTERNATIONAL COUNCIL ON CLEAN TRANSPORTATION 5 POLICY AND ENVIRONMENTAL IMPLICATIONS OF USING HEFA+ FOR AVIATION

into several different codes based on Environment and Climate Change If more favorable policies were put in their feedstock type and level of GHG Canada’s framework document on place, it is possible that AJF produc- reduction. Currently, AJFs produced the proposed Clean Fuel Standard tion could divert a limited supply of from waste oils and fats qualify for D5 (CFS) suggests that Canada may sustainably available feedstocks from RINs for “advanced biofuels,” which also introduce a federal incentive for existing renewable diesel supply for can sell for approximately USD $0.34 AJFs (ECCC, 2017). At the time of the road sector. However, the climate per renewable diesel-equivalent liter.2 publication, the proposed CFS will benefit of this shift would be ques- be a performance-based standard tionable. For example, in a best-case Although several different food-based that incentivizes fuels on the basis scenario where strong incentives shift feedstocks such as soy and canola are of their carbon intensity across three the existing production of renewable approved under RFS, HEFA+ produc- broad pools of fuel: liquid, gaseous, diesel from wastes and by-products tion from palm oil specifically would not and solid. This approach would not toward the aviation sector, there is qualify for RINs unless it is produced at include any sector-specific goals and likely not sufficient feedstock supply grandfathered facilities that were pro- could allow AJF production to qualify to compensate for that diversion ducing fuel in 2007 or earlier. for the purposes of meeting the CFS within the road sector. In effect, this target of 30 million tonnes of CO e would simply shift existing emissions California will likely amend its LCFS to 2 reductions by 2030. Furthermore, reductions (or emissions increases in include AJF as an eligible opt-in fuel the proposed policy will exclude some cases, such as palm oil) from the in by 2019 (CARB, 2017). This could indirect emissions accounting, road sector toward aviation, and at a create a substantial market for AJF thereby allowing a wide variety of higher policy cost. Furthermore, in the in California, as the incentive value possible feedstocks to qualify within absence of strong policy safeguards from LCFS could be combined with the program. on sustainability and ILUC, an increase the RIN credits generated under the in net demand for HEFA+ and renew- U.S. RFS. The LCFS is a performance- In the aviation industry, AJF propo- able diesel may result in additional based standard in which fuel produc- nents commonly advocate for a level production of food crops such as oil ers generate credits according to playing field for AJF and alternative palm and soybean, undermining the the carbon intensity of the finished road fuels (IATA, 2015). As North benefits of alternative fuels policies. fuel relative to the fossil baseline; the American fuels policies begin to shift toward allowing aviation fuels to opt value of the credit is derived from in and receive the same treatment as Conclusion both the carbon reduction from the fuels used in the road sector, it is still The introduction of HEFA+ fuel fuel and the trading price of LCFS unclear whether the aviation sector presents an opportunity to ramp up credits. LCFS credit values can vary can out-compete the road sector for a the consumption of AJFs substantially greatly, with ranges from $20/tonne limited supply of low-carbon biofuels in the short term, as this fuel is already CO e in 2015 to more than $140/tonne 2 made from sustainable wastes and by- produced at a commercial scale world- CO e in early 2018 (CARB, 2018b). At 2 products. Because the road sector is wide for the road sector as renewable the time of publication, a liter of used already obligated to transition to alter- diesel. HEFA+ alone cannot meet the cooking oil–based renewable diesel native fuels and is subject to fuel taxes, necessary performance specifications would be eligible for an incentive of it is able to support higher fuel prices. for jet fuel, but there is evidence that USD $0.34 per liter (CARB, 2017a, The final price of diesel and gasoline in at low blend levels (15% or below) 2018a).3 As with the U.S. RFS, HEFA+ the road sector reflects fuel taxes and it can be incorporated into existing production from palm oil would likely the costs associated with compliance aircraft with minimal drawbacks. fall above the fossil fuel baseline and for road-sector policies such as sulfur Although HEFA+ production could thus be ineligible for credit generation limits and the RFS. In contrast, the displace large volumes of petroleum in California’s LCFS. international aviation sector is accus- jet fuel, generating large volumes of tomed to lower fuel prices because alternative fuel alone is not a meaning- 2 Assuming an energy-equivalence value of 1.7 aviation fuel is untaxed; consequently, ful policy goal. Rather, policymakers for non-ester renewable diesel. it has a lower willingness-to-pay and should focus on making meaningful 3 Estimated using the LCFS Credit Price would likely support lower prices for GHG reductions; simply supporting Calculator with an assumption of a credit finished fuels than the road sector (El greater volumes of HEFA+ fuels will price of $140/tonne CO2e and a carbon

intensity of 20.28 gCO2e/MJ. Takriti, Pavlenko, & Searle, 2017). not ensure this outcome.

6 INTERNATIONAL COUNCIL ON CLEAN TRANSPORTATION WORKING PAPER 2018-06 POLICY AND ENVIRONMENTAL IMPLICATIONS OF USING HEFA+ FOR AVIATION

The carbon intensity of HEFA+, as with by the indirect emissions caused by diesel production away from the road renewable diesel in the road sector, is their diversion from their existing uses. sector. Without a strong price signal strongly dependent on the feedstock Lignocellulosic feedstocks with much from the CORSIA program, airlines used to manufacture the fuel. HEFA+ higher availability and lower indirect may not be able to afford the price feedstocks include vegetable oils, effects are unlikely candidates for the premium for renewable diesel produc- used cooking oil, and animal tallow. HEFA+ process, limiting the ability of tion relative to the current price of Increased demand for virgin vegeta- HEFA+ to meet the aviation sector’s petroleum-based diesel. Furthermore, ble oils can cause upward pressure ambitious climate goals.4 if HEFA+ demand were to lead to on land use and competition with the increased overall production of food sector, generating ILUC emis- The existing framework of fuels renewable diesel, it is likely that the sions. The waste and by-product feed- policies in North America could additional production would come stocks used for HEFA+, such as used feasibly support HEFA+ production from vegetable oil feedstocks with cooking oil, are already nearly fully in the near future, but it is unclear dubious climate benefits. Therefore, utilized within the road sector, and whether an even playing field with the HEFA+ fuels are unlikely to be a key evidence of the benefits of using these road sector will be a strong enough pathway to decarbonization of the feedstocks for AJFs is undermined driver to divert existing renewable aviation sector.

4 The relative GHG benefits and sustainable availability of lignocellulosic feedstocks for AJF production in North America are explored in more detail in Pavlenko (2017).

WORKING PAPER 2018-06 INTERNATIONAL COUNCIL ON CLEAN TRANSPORTATION 7 POLICY AND ENVIRONMENTAL IMPLICATIONS OF USING HEFA+ FOR AVIATION

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