Microsoft, Shell invest in LanzaJet, sustainable jet fuel start-up

Jet fuel is a notorious bugaboo in the race to lower emissions.

Chicago-based start-up LanzaJet is trying to address the problem by producing an alternative to petroleum-based conventional jet fuel that has lower carbon emissions and works with existing airline industry infrastructure.

The company, formed in 2020, hasn’t generated any revenue yet, but it’s gotten plenty of funding to get going. It recently received $50 million in funding from Microsoft, adding to previous investments from Shell and a handful of other energy companies and airlines, and the U.S. Department of Energy has invested $14 million in a subsidiary of the company to build LanzaJet’s first plant in Georgia. By 2023, that plant is expected to be producing tens of millions of gallons of sustainable jet and diesel fuels.

Non-military aviation represents 11% of United States transportation-related emissions, according to The White House. And almost all of those emissions come from jet fuel, says Dan Rutherford, the aviation director at the International Council on Clean Transportation. For example, United reported 15.49 million metric tons of carbon dioxide equivalent in 2020, and 15.39 million metric tons of that came from jet fuel.

There are several ways to decarbonize the airline industry, which is generally considered one of the hardest sectors to make clean.

None of them are perfect.

Electric planes are in their early stages of development and production, but current battery technology has range limitations, and the batteries themselves are heavy, which is a problem in air travel.

Hydrogen-powered planes are another possibility, but producing clean hydrogen today is expensive, and it wouldn’t work on existing planes. Engines would have to be modified. Airbus is developing a hydrogen-powered plane, for instance, but it may not be in production until 2035.

Compatibility with existing planes is necessary to start cleaning up the airline industry today, as airplanes last for between 20 and 30 years and designing a new aircraft takes about a decade.

Also, aviation is necessarily a global industry. A solution has to work everywhere a plane goes.

“So, the U.S. may make progress in developing and deploying a hydrogen-powered aircraft. Will India also be ready to accept and refuel that aircraft?” said LanzaJet CEO Jimmy Samartzis.

That leaves sustainable aviation fuel, or SAF, which is certified to work with existing planes. LanzaJet’s SAF can be blended with regular jet fuel in a 50/50 mix.

“For us, it’s about the urgency of needing to take action today.” Samartzis told CNBC. “SAF is the best solution for the coming years and likely two-plus decades.”

LanzaJet’s technology is…