Summit Ag Group to build 'world's largest' ethanol-based SAF plant in USGC

Summit Agricultural Group plans to build the world's largest ethanol-based sustainable aviation fuel plant in the US Gulf Coast, which will add 250 million gallons/year of capacity to the region beginning in 2025, the agricultural service company said May 15.

The plant will utilize Honeywell's ethanol-to-jet production process to transform low-carbon ethanol into SAF, thereby expanding demand for low-carbon ethanol producers while creating much-needed supply of SAF for the aviation industry.

The developers of the plant, which will be called Summit Next Gen, credited the Inflation Reduction Act as the catalyst for the project. The IRA created a standalone blending credit for SAF between $1.25-$1.75/gal, making SAF credits more valuable than that of other renewable fuels.

Summit Agricultural Group's CEO, Bruce Rastetter, said that the plant will enable "forward-thinking ethanol producers to be favorably positioned for the present challenge of helping aviation reduce its carbon footprint."

Summit is currently collaborating with Honeywell and Burns and McDonnell in the project's engineering and design phase. A spokesperson from Summit Agricultural Group declined to respond to questions asking where in the Gulf Coast the project will be located.

Ethanol to jet "is a natural next step for the ethanol industry," Summit Ag Investors President Justin Kirchhoff said. "Scale, cost of production, and carbon footprint are the most important factors for the SAF industry, and we believe ethanol has a material advantage in these areas relative to existing SAF feedstocks."

The plant's 250 million gallons/year production capacity will more than double the size of another major SAF plant on the Gulf Coast. In Louisiana, DG Fuels' $2.5 billion SAF plant is expected to come online around 2026, bringing an initial production capacity of 120 million gallons/year of SAF with plans for future expansion.

Already, DG Fuels has sold all of its initial production capacity(opens in a new tab) to various buyers. Delta Airlines agreed to purchase 55 million gallons/year for a seven-year period beginning in 2027. Air France-KLM agreed to buy 21 million gallons/year for a 10-year period beginning in 2026. The identities of three other buyers have not been disclosed.

Decarbonizing aviation through SAF

Replacing conventional jet fuel with SAF is projected to be the primary lever airlines will use for reaching net-zero carbon emissions industrywide by 2050.

SAF will contribute to 65% of the industry's decarbonization pathway, while new technologies will account for 13% of emissions reductions and increased operational efficiencies will account for 3%, according to the International Air Transport Association, or IATA.

Current SAF supply in the US is nowhere near the amount needed to decarbonize the aviation sector. IATA estimates that 26.4 million gallons of SAF were produced globally in 2021. By comparison, the global aviation industry consumed about 95 billion gallons/year of fossil-based jet fuel in the years leading up to the coronavirus pandemic.

However, current production levels are expected to rise sharply in the US beginning in 2025, when many new SAF production plants -- including Summit Agricultural Group's -- are due to come online, according to S&P Global Commodity Insights estimates.

Other SAF producers in the US include LanzaJet, which also produces SAF using an ethanol-based process. The startup is building its first demonstration plant in Soperton, Georgia, which is slated to produce 10 million gallons/year beginning in 2023.