Biofuels the way forward in the sky

The Gulf region is now firmly established as one of the globe's commercial aviation centres. As pointed out by CAPA [Centre for Asia-Pacific Aviation], "One-third of the world's population lives within four hours of the big three Gulf hubs: the UAE's Abu Dhabi and Dubai, and Qatar's Doha. Two-thirds live within eight hours."

As with real estate, where the mantra is "location, location, location", the Gulf hubs were placed in a fabulous location for global air travel.

Along with this blessing comes interesting challenges, though. The Gulf is a region also blessed with loads of oil. One might think that the region's airlines would see a future only based on fossil fuels. But that is not the case. Indeed, for any commercial airline, dependence on fossil fuels is not a smart thing to plan for.

Regardless of where you stand in the climate change debate, there is no argument that less pollution is a preferred way forward. Moreover, with airlines routinely seeing 50 per cent of the operating costs burned up in fuel charges, something needs to be done. The quicker, the better.

Whereas fossil fuels are consumed and not replaced, biofuels offer something novel. We can replace them even as we consume them. Since biofuels come from biomass (plant matter), production also consumes carbon dioxide. That means a big win. By using a biomass fuel source, airlines are able to move into a world where they can depend on a consistent supply and more stable prices. These are crucial features. Speak to any senior airline manager and you will hear the same thing - it's the fuel price volatility that drives airlines nuts.

Airlines sell their seats at a fixed price well in advance of the flight. Then typically 90 or 120 days later, probably well after the passenger is back from their trip already, the airline pays for the fuel. That means even though they have the cash upfront, an airline might be on risk for fuel spot prices over 120 days that can vary considerably.

What other business goes long like this on 50 per cent of its operating costs? It is a recipe for high stress. No wonder airlines are embracing the biofuel opportunity. Theirs is much less a pollution concern — they just want some stability.

Carbon neutral source

The Air Transportation Action Group points out that biomass fuel sources will typically absorb as much carbon dioxide as they produce when burned - making the source carbon neutral. Tests have shown that camelina biofuels provide an 84 per cent reduction in carbon dioxide. Moreover, biofuels do not contain sulphur.

Given this potentially "silver bullet" for commercial aviation, how can Gulf aviation benefit? For a start, fossil fuels now exported by Gulf suppliers should see this as a tremendous opportunity. Biofuels are being phased in as blends, with 50/50 biofuel/fossil mixes. Moreover, biofuels can grow anywhere — even in arid places like the Gulf. For example, Jatropha is another source of biofuel that generates 30-40 per cent of its mass in oil that can be used for biofuels. Another option for coastline regions around the Gulf is Halophytes, which look like reeds. These plants are salt marsh grasses which grow in salt water where other plant life does not do well.

It would seem a wise decision for political and business leaders in the Gulf region to embrace the biofuel movement by conducting experiments with these biofuel materials and taking a leadership role. An example of such leadership is Qatar's experiment with gas sourced aviation fuels. Though fossil-based, it demonstrates a willingness to try new ideas. With commercial aviation biofuel exploitation at an infant stage, the Gulf aviation and oil leaders can step up and play a leading role as it now does in commercial aviation.

The writer is a partner at AirInsight, an aviation and aerospace consultancy focused on industry competitive intelligence.