Iowa based Summit Agricultural backs world's biggest plant for ethanol jet fuel

Honeywell and Iowa-based Summit Agricultural are partnering to build the world's largest plant making ethanol-based aviation fuel — a project that is likely to become a $1 billion facility and expected to open in 2025.

The plant eventually will produce enough jet fuel to power thousands of flights per year, according to Summit Agricultural, run by Iowa entrepreneur Bruce Rastetter. The facility will be located on the U.S. Gulf Coast and use Honeywell's technology to transform ethanol into sustainable aviation fuel, known as SAF, the companies said Monday.

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The global aviation market demands more than 100 billion gallons of jet fuel annually, with Summit estimating that figure will double in the next 20 years.

At the same time, airlines across the globe are coming under increasing pressure to decrease their carbon dioxide emissions. The Biden administration has announced a goal for SAF to meet 100 percent of aviation fuel demand by 2050. But annual production in the United States was just 15 million gallons in 2022.

Monday’s announcement marks one of many steps private companies and governments have taken recently to bolster the market for the corn-based biofuel, which the Iowa Renewable Fuels Association said in 2021 accounted for over $5 billion of Iowa GDP, generated $2.6 billion of income for Iowa households and supported nearly 46,000 jobs in the state’s economy.

Last month, the Biden administration announced that a higher blend of the ethanol, called E15, can be sold during this summer’s driving season. The blend is generally prohibited in the summer because of environmental concerns.

More than 300 Iowa gas stations offer E15, and that is likely to rise under a law Republican Gov. Kim Reynolds signed last year mandating most gas stations in the state offer E15 by 2026. In the 2023 fiscal year so far, the state has awarded over $5.7 million to 119 biofuels infrastructure projects — including $800,000 awarded last week that includes 12 projects at gas stations, one in Cedar Rapids, to add E15 infrastructure to be able to comply with the new law.

But perhaps the most controversial effort to boost the market for ethanol is the construction of underground pipelines meant to capture the CO2 emissions of ethanol plants and sequester them underground. Critics say the pipelines are unproven and pose risks to people and the environment. But beyond that, two of the three pipeline projects proposed for Iowa — which would generate federal tax credits — are asking the state for eminent domain power to be able to force easements from reluctant landowners.

Rastetter runs one of the pipeline companies, Summit Carbon Solutions, and is seeking permission of the state’s regulators for its approximately 680-mile route in Iowa — and also for eminent domain authority. The Summit route also runs through Nebraska, Minnesota, South Dakota and North Dakota, where it would sequester the liquefied C02.

“Ethanol plants that participate in carbon capture will have access to significant new markets like this both here in the U.S. and abroad,” Rastetter wrote Monday in an email to Iowa legislators. “We continue to believe that embracing new opportunities and markets will prove to be incredibly beneficial for Iowa agriculture. It’s hard not to be incredibly bullish on Iowa agriculture given the opportunities in front of biofuels going forward.”

Summit said it is in talks about providing SAF supplies to major airlines and freight companies.

The Alden-based Summit Agricultural founded FS Bioenergia, the largest corn-based ethanol platform in Brazil; Amber Wave, a food ingredients and biofuel plant in Kansas; and Summit Carbon Solutions, which is planned to connect more than 30 ethanol plants in the Upper Midwest.

The jet fuel project is a "natural extension" for the partner plants in the United States that will use the proposed Summit Carbon Solutions pipeline to decarbonize the ethanol production, said Summit Ag Investors President Justin Kirchhoff.

The SAF plant will be in a unique position given its location on the Gulf Coast to use a variety of ethanol feedstocks from different locations. It was not clear Monday how much of that would come from Iowa.

"We can produce a net negative carbon fuel in the U.S., and the only feedstock that has enough growth potential to make a difference on SAF is ethanol," said Rastetter.

The plant will be Honeywell's first ethanol SAF deal licensing its technology. Airlines will need to "expand the feedstocks" used to make fuel to include corn, because there's not enough being made from fats or oils alone to "meet the decarbonization goals for the airlines," said Barry Glickman, vice president and general manager, Honeywell Sustainable Technology Solutions.

Bloomberg contributed to this report.