Gevo Inc (NASDAQ:GEVO) announced that it has signed a memorandum of understanding (MoU) with ADM to support the production of sustainable aviation fuel (SAF) and other low carbon-footprint hydrocarbon fuels.
The Englewood, Colorado-based company shared that the MoU suggests the production of both ethanol and isobutanol, which would be transformed into renewable low carbon-footprint hydrocarbons, including SAF, using the company's processing technology.
At least 900 million gallons of ethanol produced at ADM’s dry mills in Columbus, Nebraska, and Cedar Rapids, Iowa, as well as its Decatur, Illinois complex, is expected to be processed with Gevo’s technology, resulting in approximately 500 million gallons of SAF and other renewable hydrocarbons.
READ: Gevo enters into strategic alliance to accelerate commercialization of sustainable ethanol-to-jet projects in the US
“The potential conversion of 900 million gallons of ethanol – more than half of our production capacity – to serve the growing demand for sustainable aviation fuel would represent a major step in the continued evolution of our carbohydrate solutions business to focus increasingly on new, high-growth opportunities,” said ADM CEO Juan Luciano.
He added: “Equally important, we’re continuing to live our purpose, with our entry into SAF representing another step in our strategic efforts to advance decarbonization and use our integrated value chain to deliver more sustainable, environmentally friendly products and services.”
Demand for SAF is expected to increase as major US airlines, airports, shippers and the US government have agreed to work together to advance the use of cleaner sustainable fuels. The US and the EU have set goals that together would support almost 4 billion gallons of annual SAF production in 2030, and more than 45 billion by 2050.
“Our potential customer contract pipeline has grown to over 1 billion gallons,” said Gevo CEO Patrick Gruber. “By working with ADM, who already has committed to reducing their carbon footprint, we have the opportunity to accelerate scale. The technology to convert low carbon ethanol and isobutanol into SAF by Gevo is well developed and ready for world scale-commercialization. We look forward to working with ADM in the pursuit of Net-Zero fuels.”
The companies intend to work together to determine full commercialization plans and enter into definitive agreements enabling a timeline such that production of SAF can begin in the 2025-2026 timeframe.
Gevo is focused on transforming renewable energy and carbon into energy-dense liquid hydrocarbons. These liquid hydrocarbons can be used for drop-in transportation fuels such as gasoline, jet fuel, and diesel fuel, that when burned have the potential to yield net-zero greenhouse gas emissions.
The company is also working on addressing other environmental problems like plastics, and polyesters with its technology.
Contact Ritika at ritika@proactiveinvestors.com