What exactly is Sustainable Aviation Fuel? What needs to happen for us to start using it? And what's the government's role in propelling a new era of sky travel? Our guest Meg Whitty is Vice President of Corporate Relations and Marketing at LanzaJet, a company whose aim is to decarbonize the aviation industry. She joins us in this episode to talk about jet fuel's brave new future, which is WAY closer than you think.
lanzajet.com
LanzaJet on LinkedIn
What exactly is Sustainable Aviation Fuel? What needs to happen for us to start using it? And what's the government's role in propelling a new era of sky travel? Our guest Meg Whitty is Vice President of Corporate Relations and Marketing at LanzaJet, a company whose aim is to decarbonize the aviation industry. She joins us in this episode to talk about jet fuel's brave new future, which is WAY closer than you think.
lanzajet.com
LanzaJet on LinkedIn
Hi everybody, welcome again to no Show. I'm Matt Brown, joined as always by Jeff Borman. Meg Witte of Lonza Jet is our guest today and she is Vice President of Corporate Relations and Marketing for that company, whose aim is to decarbonize the aviation industry. She started working in biofuels over 15 years ago, with stops at the United States Department of Agriculture and United Airlines. She's worked for startups and high-growth technology companies. She's an Iowa native, a Georgetown Hoya community leader, a mother of two remarkable children, sucker for both rom-coms and spaghetti westerns there's a genre mashup, hollywood, let's bring that on and at heart she is a longtime devotee of show choir who can and will occasionally break out into song. Meg Witte, welcome to no Show.
Meg Whitty:Oh, matt, thank you so much for having me Really appreciate being on. Let's start with the basics. What is Lonza Jet? Lonza Jet is a sustainable fuels technology provider and fuels producer. We're based just outside of Chicago, but we are a global company.
Meg Whitty:When I joined the company about a year and a half ago, we were about 35 people. We're now over 100, with projects we've announced around the world. We were founded in about 2020, in the height of COVID, but we had a group of industry leaders come together and recognize that aviation needed a better solution in terms of decarbonizing, and so they came together with the technology of the ethanol to jet and I'll talk about that here in a little bit but founded Lonza Jet, and so we're going to celebrate four years here in May and we have opened recently the first ethanol to jet facility in the world in January down in Soberton, georgia, and we've got, I think, eight projects we've announced globally from here in the United States to Australia, new Zealand, india, the United Kingdom and then nearly 100 more in the pipeline. So it's pretty incredible to see the growth of the company, even since I've been here, but especially over the last four years.
Matt Brown:Sustainable aviation fuel is a term that is very popular in travel right now. Jeff and I have been talking about this over the last couple of weeks. We weren't quite sure exactly what it is. I think we know that ethanol and other substances kind of go into making it. Can you just kind of give us the 101 of what SAF is?
Meg Whitty:Yeah, sustainable aviation fuel, or SAF, is basically alternative fuels made from non-fossil feedstocks that reduce emissions for air transportation, and they can be blended at all different levels up to 50% today with traditional fossil jet fuel. According to and I double checked my numbers before coming on today, according to the International Civil Aviation Organization, over 360,000 commercial flights have actually already flown using sustainable aviation fuel across 40 plus different airports, but largely concentrated in the United States and in Europe, and today there are about eight different approved what are called pathways, which are designations by the American Society of Testing and Materials that say this is a way that you can make jet fuel. The only one of those today that is commercially viable is one that is called HEFA, or hydro processed esters and fatty acids, and I am not an engineer, I'm not going to get in the technical weeds with you, but essentially it's used cooking oil and animal wastes, fats and greases, and that's the only one today that's commercially viable. The problem with HEFA is that over the next few years we're going to reach a production capacity with HEFA, so there's not going to be enough used cooking oil in the world for us to continue to fly aviation on it. So that's where our technology comes in, it's ethanol to jet fuel, and today globally there's about 30 billion gallons of ethanol.
Meg Whitty:That's produced 17 billion gallons here in the United States and so what's really exciting about ethanol as a molecule is so many things can be used to make ethanol.
Meg Whitty:You can use renewable power. You can use as we know here in Iowa, corn is sort of the traditional feedstock used, but you can use sugarcane. You can use municipal solid waste and a variety of other feedstocks to, but you can use sugarcane. You can use municipal solid waste and a variety of other feedstocks to make ethanol, to make low-carbon ethanol, and so we take that low-carbon ethanol and then we convert it into sustainable aviation fuel. So it's both incredibly versatile in terms of a technology, but it's also incredibly scalable. When you think about the huge market demand in aviation right, aviation as an industry consumes about 100 billion gallons of fossil jet fuel a year, and today only about 119, as of last year, million gallons of sustainable aviation fuel was produced, and so that's a massive delta right. That's less than 1% of global demand for aviation, and so we need a solution that is scalable, that can be produced anywhere in the world, and that's where our technology for sustainable aviation fuel is incredibly powerful.
Jeff Borman:Did I hear you right that the animal waste fuel is actually called heifer animal waste?
Meg Whitty:fuel is actually called heifer. Heifer, but that's funny. I've never heard that before and that's pretty good.
Matt Brown:We'll have to pass those notes along. We're always coming up with ideas here. Okay, so sustainable fuel is great, let's do it. How do you explain the advantages of it to not just the airlines, but like to consumers? What's kind of the uncle at holiday dinner pitch for why this is a good thing for everybody?
Meg Whitty:Yeah. So, as I mentioned before, I'm in Iowa, right, and so I have family members on both sides of the aisle, so I think the easiest way to talk about it is one is guilt-free flying when you're thinking about sustainability and if you care about your carbon footprint For the relatives on the other side of the aisle. The other benefit of sustainable aviation fuel is often these plants are pulling from communities that have historically been industrial communities that may not be thriving the way they were 40, 50 years ago, and we're revitalizing these rural communities. It's industries like ethanol that 40, 50 years ago and we're revitalizing these rural communities. It's industries like ethanol that again are in these rural communities that we're giving a new life.
Meg Whitty:Traditional ethanol today goes into ground transportation, right, and so you're seeing the increased electrification of sort of light-duty ground vehicles and you're going to see a demand degradation for gasoline and for ethanol.
Meg Whitty:Where does that industry go if that demand continues to decline? Aviation with sustainable aviation fuel presents an incredible opportunity for those industries and those rural communities to look and say, oh my gosh, I have a whole huge new market opportunity here to be able to grow, and that's good for rural America. That's good for rural America, that's good for the world, right? So when I think about that and think about jobs, when I think about energy security, I think about, obviously, sustainability. When I think about individuals, that's kind of where, for me, I think, it resonates the most. When you're talking to sort of corporations, right, a lot of these bigger corporations are thinking about how they can reduce things like their scope three emissions, or their emissions resulting from activities, from assets that they don't control or own. Flying on sustainable aviation feels a great way to do that. So that's kind of how I think about it in terms of the dinner table here in Iowa or really around the world.
Jeff Borman:So what are the traditional jet fuel providers? Take on LanzJet or sustainable aviation fuel overall. There's got to be a big lobbying group out there that does not want you to succeed.
Meg Whitty:You know it's interesting On our board and our founders and investors are part of the traditional sort of oil and gas industry. So Shell is one of our board members. Suncor is Canada's largest energy producer. You're seeing a lot of these traditional oil and gas companies recognize that they have an obligation to find new opportunities with sustainability. Sustainable aviation fuel actually presents a new market opportunity for them as well. I think you're always going to get traditional oil and gas in some ways to go. You know this is different. This is new. But at the same time, we're actually seeing more and more of those organizations BP, exxonmobil, others doing more in this space and I think what I've seen is folks like Suncor, folks like Shell, really investing in this space and in meaningful ways.
Matt Brown:candidly, what needs to happen over the next few years. How is this going to start hitting the market when planes want to use this fuel?
Meg Whitty:So the great thing is today, because sustainable aviation fuel is a drop in fuel, none of the existing infrastructure needs to change at an airport, and so you literally put it in like it is any other type of fuel. Molecularly, it is identical to fossil jet fuel. So for us, when we think about Freedom Pines, which is our first facility that we had a grand opening for earlier this year, we'll be producing about 10 million gallons a year, nine of which will be sustainable aviation fuel, one of which will be 1 million gallons of that will be renewable diesel. That fuel is going to be taken by a number of our investors, including British Airways, on commercial flights, and so you're going to see it, you have seen it, you will continue to see it on commercial flights. I think also, you've seen it on and will continue to see more of it, especially in private, smaller, regional jets as well.
Meg Whitty:I think there's increased skepticism, conversations around our global footprint as it relates to aviation and, again, sustainable aviation fuel is a great way for the industry collectively to reduce its emissions and, in fact, the aviation industry in general has said we are going to be net zero by 2050. And how they account for that is through a series of initiatives operational efficiencies, infrastructure efficiencies but sustainable aviation fuel is going to count anywhere from 65 to 70% of that reduction, and so it's pretty significant in terms of how they're thinking about globally their reduction in overall emissions.
Jeff Borman:Net zero by 2050. One way to get there would be to do what France did and just say hey, no flights under two hours. Right, we're just going to not do that. No flying, that's a very net zero for the flight. But you're moving it to a train, then right, presumably it doesn't stop people from traveling, just do it a different way. Is that a good thing or a bad thing?
Meg Whitty:Look from our perspective. Aviation is critical for global commerce, for connecting industry, families, cultures. We're not going to stop flying. You know we can do it differently and handle things differently locally, but in terms of how we connect across the world, aviation is on scale to grow I think about 4% annually over the next 20 years. And when you think about global consumption today and what that looks like projected out over the next 10 years, 20 years, it will likely continue to grow. The idea that we're going to stop flying globally just isn't realistic Now. In order for us to do that, sustainable aviation fuel is a really great alternative to bring those emissions down.
Jeff Borman:You mentioned that flights have been taken already using sustainable air fuel Of the 300,000. Though what's the distance?
Meg Whitty:It varies. So anything from a regional flight to international flight. So our fuel has actually been tested on two flights internationally One that was a Boeing delivery flight with Alnapon Airways from Seattle to Japan and then a transatlantic flight with Virgin Atlantic from the US to London, and so you've seen the huge range of flights being tested with sustainable aviation fuel. It's incredible.
Matt Brown:Do you get the same mileage? I guess for lack of a better term.
Meg Whitty:Yeah, that's a great question and actually so. We did a study on our SAF a few years ago, working with Canada, and it actually shows that our fuel is more energy dense than traditional fossil jet fuel, which means it's actually not only more efficient, but it actually is. You're able to fly farther on it and it reduces contrail formations which, if you're familiar at all with the trail behind the plane, it actually those white lines are even more sort of detrimental to the environment, and sustainable aviation fuel can reduce just the visible and also the physical emissions there. So it's more energy dense, so it's actually even better for the environment from that perspective as well.
Matt Brown:Do you see a future where a Lanza jet maybe has a spinoff where it's Lanza train, Lanza car? Is this at all viable for other modes of transportation?
Meg Whitty:So we, with our Georgia plant, will be producing, as I mentioned, 9 million gallons of SAF but then 1 million gallons of renewable diesel, and that can be used on heavy-duty vehicles shipping, but then also actually one of our partners is using that for their data centers, to fuel their data centers, and so there's a whole huge variety of opportunities there with renewable diesel.
Matt Brown:Our friend Matt Cornelius, who's kind of our aviation guru. He had mentioned something the other day in conversation about the role of government incentives. The US model is seen as somewhat preferable to the European model as far as incentivizing these kinds of programs. I was curious because it's strange to hear that, because you always kind of assume that Europe is just naturally incentivizing these kinds of things in a way that the US doesn't. But so it's nice to hear that the shoe's on the other foot.
Meg Whitty:Matt, that's exactly right. And it's interesting because I started working in this space 15 plus years ago and it was the shoe was on the other foot, I think at that time where we were looking to Europe with their emission trading scheme and otherwise saying, you know, these guys are way ahead of us. And now what's really interesting is Europe is looking to the United States with the Inflation Reduction Act and saying, wow, these types of incentives are actually doing a lot to spur more technology, more innovation, more production. So with the Inflation Reduction Act, there are specific incentives for sustainable aviation fuel no-transcript. So that's a great thing. And one of the other things that's great about it is it's because it's performance based. So it's not saying we're going to say you know, these specific feedstocks are OK to use to produce SAF.
Meg Whitty:What the United States is saying is, as long as you get to this threshold and from a carbon perspective, you're taking this much carbon out of the air and you're hitting this. You know, create this sustainability criteria, then you can use. You can use whatever sources you want. Europe sort of takes a stick approach, whereas the United States take us but more of a carrot approach. Right, they have mandates, we have incentives.
Meg Whitty:I think it'll be interesting to see over the course of the next 10 years how that shifts. But for us in the US the Inflation Reduction Act has done a huge amount in terms of spurring more production and more work in the sustainable aviation fuel space, and you're also seeing more incentives on a state level. States like Illinois are creating additional incentives for purchasers of that fuel around sustainable aviation fuel. Other states like Minnesota and Washington state are as well. So those incentives can stack right and so right now an 80-year-old industry is going to be a heck of a lot cheaper than a brand new industry, and so getting the cost of sustainable aviation fuel down closer to traditional jet fuel is important. So those incentives early on are critical in terms of spurring that growth of a new industry.
Jeff Borman:Ultimately, who decides to put SAF onto an airplane?
Meg Whitty:Yeah, the airlines right, and so you have to have the airlines showing the market that, hey, we want this. And the great thing is, the airlines have said collectively we are going to commit to reducing our carbon emissions by 2050. Many airlines in particular have said you know, we're going to say, 10% of our fuel by 2030 is going to be on sustainable aviation fuel, or they have offtake agreements in place when this fuel is produced. What we're seeing is the airlines that are making upfront investments and companies like Lonzojet and others. It's actually more meaningful than saying, hey, when the fuel is ready, we'll buy it, which is great, and it's important for the market to see that demand is there.
Meg Whitty:But in order for us to be able to actually produce the fuel, we need support early on to build these plants, to get to production state, and so one thing that we announced in the last month was an investment $30 million investment from Southwest Airlines. That is saying hey, you know, Lonza Jet, we're taking a bet on you, we're investing in you and your growth of your company, and also we're going to work with you to build one of these facilities here in the United States, and so that is especially meaningful. But you need to have the airlines who are going to say we want to buy this today, which is critical for the industry to be able to grow.
Matt Brown:America loves talking about infrastructure. When it comes to building infrastructure, call me, in 15 years, what infrastructure investments are needed to deliver fuel to where it's needed. What are we going to have to do for LGA or JFK or LAX to get fully outfitted with this?
Meg Whitty:The great thing is, the airports themselves, for the most part, don't need to make any modifications to existing infrastructure because, again, the fuel itself is molecularly identical, so it doesn't impact the engines, it doesn't impact the pipelines. Now, today there is a limit in terms of the percent of SAF that can be blended with traditional fossil jet fuel, and we'd love to see that lifted, and there have been flights that have shown that we can fly 100% of SAF on planes, but right now it's a 50-50 blend, and so today the airports don't really need to do much of anything. Now you do need to have that blending infrastructure off-site, most likely to blend that traditional fossil jet fuel with the SAF, and so that's a piece today that still needs to happen. We're working with pipelines, we're working with ports to do that today, but in terms of the airports themselves, not much.
Matt Brown:You've also worked in energy as I said at the top of the episode for a while now and you've seen it from the government side and from the private sector side. What do you think is different about DC's general attitude towards sustainable fuel now versus, say, 20 years ago, 15 years ago?
Meg Whitty:It's really interesting. So I started off working in biofuels actually during a Republican administration and I was a career appointee, so I was non-political and so I worked both in Republican administrations and Democratic administrations. And the thing that I think is really interesting about this industry in particular whether biofuels, renewable energy or SAF in particular is it's fairly bipartisan, right For the reasons I mentioned earlier. I think the thing today that is different is you're seeing that a bit of a catalyst in the industry of all of the necessary pieces coming together right Before you know, 15 years ago the government was really trying to spur innovation and kind of invest in small ways, and today you're not only seeing the government get involved in meaningful ways and really putting a significant amount of money behind it, but also you're seeing private industry get involved in a way that they just weren't as much 15 years ago.
Meg Whitty:Nobody was talking about SAF. 15 years ago SAF wasn't a thing, it was aviation biofuels. But you're seeing the technology, you're seeing the finance community come together and, I think, also creatively pull together solutions that make sense in order to get these projects off the ground. We had the SAF Grand Challenge that was announced in 2021 with the USDA, the DOE and the Department of Transportation to say that we are going to produce in the United States 3 billion gallons of SAF by 2030 and 35 billion gallons of SAF by 2050. Lonzajet has said hey, we're going to aim to produce 1 billion gallons of that, 3 in the next what is it? 2024, the next six years. I think, having all of those pieces and you're seeing the consumer in a way that you really weren't before, with the airlines, with private consumers, individual consumers really wanting this and demanding it to some degree, right, and that all of those pieces collectively really are shifting the dynamic and the urgency with which I think things are getting done, which is pretty exciting to see.
Matt Brown:It's time for the mystery question. You live in Des Moines, iowa. Des Moines is one of my favorite cities in the world. For people who have not visited Des Moines, they land, check into the hotel they're going to go out to eat. What's the one restaurant they should go to in Des Moines and it can't be a restaurant downtown that starts with C.
Meg Whitty:And I want it to be your personal recommendation.
Matt Brown:I don't want it to be like the thing that would show up on the Eater Best of Des Moines. I want it to be where you think a visitor to Des Moines should go.
Meg Whitty:You know what I would say oh, go ahead.
Jeff Borman:I just want to know what this restaurant with a CEO, but please.
Meg Whitty:I'll come to that, the one that I would say and, matt, my guess is that you've been there is a restaurant that is inside a probably 150 year old, 100, maybe leave your 130 year old old Victorian home and it's called a pasto and it is a. Oh, you haven't been. Oh, it's so good. I've never had a bad meal there. It is delicious, and I think one of the the sort of best kept secrets about Des Moines is our restaurant scene is pretty good. Uh, and the food here.
Meg Whitty:You know, despite being in the middle of the Midwest, which people would say, I bet your meat and potatoes are 10 out of 10. They are, but guess what? Also really good variety and great chefs. And so Apostolo is an Italian restaurant, but they have all different types of food. It is so good. The wine pairings are so great. Would highly recommend. But Centro is the VC restaurant that Matt was referring to, which is very popular, also great food, but is sort of, I think, has become the default recommendation in Des Moines. But Aposto is, hands down, I think, my favorite, and if I had to ask my husband, I think that would probably be his favorite too. But there are a bunch of really good ones, really good ones downtown.
Matt Brown:There are, and I love, I love Chintra, but it has become the it's. It's been in that number one slot for a second, so I feel like we need to explore.
Meg Whitty:I have also give a quick shout out to a brand new restaurant that you and Amanda need to hit the next time you're here, which is called Oak Park and that one is quite close and it's brand new and in the last probably six or seven months and they've done a great job with their menu. So also another good one.
Matt Brown:Excellent. Thank you so much, meg Witte, everybody, we are so glad that you joined us. Thank you, this has been wonderful. Thank you.
Meg Whitty:Thank you so much for having me.