A Wake Up Call For Airlines  

Posted by Big Gav in , ,

Tyler Hamilton has a column in The Toronto Star on options for weaning airlines off oil, with (algae based) biofuels being his preferred option (one I agree is probably the best bet) - Fuel crisis forces wake-up call on airlines.

It's not a good time to be in the business of air travel. Twenty-four airlines were grounded or filed for bankruptcy in the first half of 2008, according to the International Air Transport Association, and the dominoes continue to fall.

The primary reason: the rising cost of jet fuel.

Just last week, Britain's third-largest tour operator simply closed shop and left thousands of customers stranded. XL Leisure Group PLC, parent of XL Airways, cited rising oil prices as a main reason for its financial collapse.

So what's the solution? While there's no short-term fix, this is a wake-up call to an industry that, more than ever, needs to focus on developing alternative fuels that aren't captive to the volatility of oil. In fact, one could strongly argue that developing biofuels for the aviation sector – which accounts for about 3 per cent of human-caused greenhouse gas emissions, and growing – should be given higher priority than developing renewable fuels for cars and trucks.

For one, the alternatives for aviation are more limited than the options for ground transportation. Most engineers will tell you that using hydrogen or electricity to power a passenger jet just isn't realistic, at least not for decades.

Back in April, Boeing successfully tested a hydrogen-powered propeller airplane – it was the first manned flight of its kind. But the company said at the time it didn't believe hydrogen, which contains about a quarter of the energy as kerosene-based jet fuel, could be the primary source for large aircraft. More likely is that fuel cells powered by hydrogen could be a secondary power source for on-board operation of electronics and other non-critical systems.

The same argument goes for battery-powered electric planes. The batteries or hydrogen needed to get a fairly large plane off the ground would simply be too heavy, making the whole proposition inefficient and uneconomical.

Battery-powered electric cars and trucks, on the other hand, make much more sense. The basic charging infrastructure already exists. Battery innovation is moving at a rapid clip. Powering a vehicle would be more efficient, cleaner, and cost less than using gasoline or diesel. The carbon footprint of a vehicle would automatically improve as more wind, solar, geothermal – and even nuclear – is added to the grid-supply mix.

This "electrification" of ground transportation is already taking shape. Most major car manufacturers have announced plans to release plug-in hybrid electric vehicles by 2010, and some are even planning all-electric models. Utilities are beginning to plan for this future, and politicians are getting solidly behind the trend.

Given this, it's fair to ask whether our focus on developing biofuels for cars and trucks has been misplaced. According to the Institute for Energy Research in Washington, D.C., about 50 per cent of a barrel of oil goes toward making gasoline for automobiles.

Critics of ethanol contend that making any sizeable dent in gasoline demand would put too much of a strain on land resources and food supply, particularly if the primary feedstock for this ethanol remains corn. Cellulosic ethanol, based on non-food materials such as woody biomass, municipal solid waste, and switchgrass, does hold much promise as a next-generation biofuel – but why waste it on cars that could be better powered by electricity?

About 10 per cent of every barrel of oil goes toward making jet fuel. Aiming biofuels at this 10 per cent seems a much more realistic goal, and it would help clean up an industry much more limited with its options.

This is where I part with Guardian journalist George Monbiot, author of the popular global-warming book Heat. Monbiot believes biofuels are a proposed cure that is worse than the disease. "Even before they are deployed commercially in jets, biofuels are spreading hunger and deforestation," he wrote in May. In his view, the climate-friendly solution to air travel is to not fly, or take an airship like the Hindenburg.

Ummm ... not quite. Not all biofuels are created equal. And the world food crisis seemed to come and go — at least in the media — with the rise and fall of oil prices. Biofuels, after the dust settled, played a minor role.

What Monbiot seems to ignore is innovation that brings biofuels beyond corn and soya beans, using more energy-efficient methods of production that don't threaten food supply. And if we narrow the development focus from transportation generally to aviation specifically, research becomes highly targeted and the volume of biofuels required becomes more manageable and sustainable.

JetBlue, Air New Zealand, Continental Airlines, Virgin Atlantic, and Japan Airlines are among the world's airlines that are seriously experimenting with the biofuel option (Air Canada is noticeably absent from that list). At the moment the focus is on blending renewable fuels with kerosene, but a number of ventures – including Aquaflow Binomics, Inventure Chemical, and Solazyme – are determined to develop an entirely renewable jet fuel.

Turning algae into jet fuel seems to be the most promising option.

Last week, San Francisco-based Solazyme reported that a new jet fuel it makes from algae oil passed 11 of the most challenging specifications needed to meet industry aviation turbine fuel standards. "The Solazyme algae-based aviation kerosene has passed the biggest hurdles needed to successfully develop a commercial and military jet fuel fully consistent with existing engines and infrastructure," according to the Southwest Research Institute, an independent lab that conducted the tests.

3 comments

The airlines didn't go under because of jet fuel prices. They went under because they were selling a product for less than it cost to provide the product.

I pay more for a pizza slice because his costs have gone up, and he has to make money. The airlines pay more for fuel, and then go and cut airfares. huh?

I'm sorry - you can't fly from A to B for $99 any more. Those days are over. Charge what it costs and - surprise - you might actually stay in business.

bio fuels may be nice - but if you keep a money losing financial model in place, it won't matter...

Anonymous   says 6:39 AM

Air Canada's absent indeed. And what did AC's biggest competitor do today? Well, WestJet dropped its "fuel surcharge" in the face of all of Air Canada's extra charges and fees. These guys know how to run an airline. Too bad our tax dollars are bailing out the "national airline" just like the poor saps in the US bailing out their financial companies.

John - clearly you aren't aware of how much of the airlines' cost base is related to fuel prices - it's the single most important factor.

As for rising prices, they often decrease demand for a company's services - the problem isn't solved by simply raising prices, as a lot of their customer base will disappear beyond a certain price point...

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