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Shell invests in LanzaJet to speed up deliveries of its synthetic aviation fuel
The energy giant Shell has joined a slew of strategic investors — including All Nippon Airways, Suncor Energy, Mitsui and British Airways — in funding LanzaJet, the company commercializing a process to convert alcohol into jet fuel.
A spin-off from LanzaTech, one of the last surviving climate tech startups from the first cleantech boom that’s still privately held, LanzaJet is taking a phased investment approach with its corporate backers, enabling them to invest additional capital as the company scales to larger production facilities.
Terms of the initial investment, or LanzaJet’s valuation after the commitment, were not disclosed.
LanzaJet claims that it can help the aviation industry reach net-zero emissions, something that would go a long way toward helping the world meet the emissions reductions targets set in the Paris Agreement.
“LanzaJet’s technology opens up a new and exciting pathway to produce SAF using an AtJ process and will help address the aviation sector’s urgent need for SAF. It demonstrates that the industry can move faster and deliver more when we all work together,” said Anna Mascolo, president, Shell Aviation, in a statement. “Provided industry, government and society collaborate on appropriate policy mechanisms and regulations to drive both supply and demand, aviation can achieve net-zero carbon emissions. The strategic fit with LanzaJet is exciting.”
LanzaJet is currently building an alcohol-to-jet fuel facility in Soperton, Georgia. Upon completion it would be the first commercial-scale plant for sustainable synthetic jet fuel, with a capacity of 10 million gallons per year.
The fuel is made by using ethanol inputs — something that Shell is very familiar with. It’s also something that the oil giant has in ready supply. Through the Raízen joint venture in Brazil, Shell has been producing bio-ethanol for more than 10 years.
The company expects that its sustainable fuel will be mixed with conventional fossil jet fuel to power airplanes in a lower carbon intensity way. Roughly 90% of the company’s production output will be aviation fuel, while the remaining 10% will be renewable diesel, the company said.
LanzaJet’s SAF is approved to be blended up to 50% with fossil jet fuel, the maximum allowed by ASTM, and is a drop-in fuel that requires no modifications to engines, aircraft and infrastructure. Additionally, LanzaJet’s SAF delivers more than a 70% reduction in greenhouse gas emissions on a lifecycle basis, compared to conventional fossil jet fuel. The versatility in ethanol, and a focus on low carbon, waste-based and nonfood/nonfeed sources, along with ethanol’s global availability, make LanzaJet’s technology a relevant and enduring solution for SAF.
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LanzaJet inks deal with British Airways for 7,500 tons of low-emission fuel additive per year
LanzaJet, the renewable jet fuel startup spun out from the longtime renewable and synthetic fuel manufacturer LanzaTech, has inked a supply agreement with British Airways to supply the company with at least 7,500 tons of fuel additive per year.
The deal marks the second agreement between the U.K.-based airline and a renewable jet fuels manufacturer following an August 2019 agreement with the British company Velocys. It’s also LanzaJet’s second offtake agreement. The company announced itself with a partnership between the renewable fuels manufacturer and the Japanese airline ANA.
Through the deal, British Airways will invest an undisclosed amount in LanzaJet’s first commercial scale facility in Georgia. The fuel will begin powering flights by the end of 2022, the companies said.
It’s part of a broader expansion effort that could see LanzaJet establish a commercial facility for the U.K. airline in its home country in the coming years.
Back in the U.S. the plan is to begin construction on the Georgia facility later this year, which will convert ethanol into a jet fuel additive using a chemical process.
Fuel from the plant will reduce the overall greenhouse emissions by 70% versus traditional jet fuel. It’s the equivalent of taking almost 27,000 gasoline or diesel-powered cars off the road each year, according to the company.
The deal is the culmination of years of research and development work between LanzaJet’s parent company, LanzaTech, and Department of Energy’s Pacific Northwest National Laboratory.
Spun off in June 2020, LanzaJet was financed by an investment group including parent company LanzaTech, Mitsui, and Suncor Energy. British Airways now joins the two other strategic investors as LanzaJet eyes an ambitious scale-up program through 2025. The company plans to launch four large-scale plants producing a pipeline of renewable fuels.
“Low-cost, sustainable fuel options are critical for the future of the aviation sector and the LanzaJet process offers the most flexible feedstock solution at scale, recycling wastes and residues into SAF that allows us to keep fossil jet fuel in the ground. British Airways has long been a champion of waste to fuels pathways especially with the UK Government,” said Jimmy Samartzis, the chief executive of LanzaJet. “With the right support for waste-based fuels, the UK would be an ideal location for commercial scale LanzaJet plants. We look forward to continuing the dialogue with BA and the UK Government in making this a reality, and to continuing our support of bringing the Prime Minister’s Jet Zero vision to life.”
The LanzaJet fuel is certified for commercial flight up to 50% blend with conventional kerosene. “Considering the aviation market is 90 billion gallons of jet fuel a year, having 50% or 45 billion of production capacity and reaching that max blend level will be a great problem to have,” said LanzaTech chief executive Jennifer Holmgren in an email.
LanzaJet’s manufacturing facility in Georgia is designed to produce zero-waste fuels, according to Holmgren, and British Airways will receive 7,500 tons of sustainable aviation fuel from LanzaJet’s biorefinery each year for the next five years.
The partnership is between British Airways, Hangar 51 (International Airlines Group’s accelerator) and others.
In addition to its biofuel work, British Airways is also working with companies like ZeroAvia, the hydrogen fuels company that also received backing from Amazon, Shell and Breakthrough Energy Ventures.
“For the last 100 years we have connected Britain with the world and the world with Britain, and to ensure our success for the next 100, we must do this sustainably,” said British Airways chief executive Sean Doyle.
“Progressing the development and commercial deployment of sustainable aviation fuel is crucial to decarbonising the aviation industry and this partnership with LanzaJet shows the progress British Airways is making as we continue on our journey to net zero.”
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RideCell expands funding round to $60 million
RideCell, a transportation software startup, has doubled its previously announced Series B funding round to $60 million, a sign that investors believe demand for cloud-based mobility platforms will grow as more companies try to scale up car-sharing, ride-hailing and even robotaxi businesses.
The company, which has developed a platform designed to help car-sharing, ride-sharing and autonomous technology companies manage their vehicles, announced it raised $28 million in May.
Activate Capital led this round; its co-founder and managing director Raj Atluru has joined RideCell’s board. Reinsurance group Munich Re’s ERGO fund, LG Technology Ventures, BNP Paribas, Sony Innovation Fund, Ally Ventures and Khosla Ventures joined this extended round. Denso also upped its investment in the Series B round.
Nearly half a dozen other companies had already invested in the Series B round, including Cox Automotive, Initialized Capital, Denso, Penske, Deutsche Bahn and Mitsui.
“Investor interest in cloud-based mobility platforms and autonomous vehicles increases almost daily as the disruptive potential of these new technologies are realized,” RideCell CEO Aarjav Trivedi said in a statement.
The company recently received a permit from the California Department of Motor Vehicles to test its Auro autonomous vehicles on public roads. RideCell acquired self-driving car company Auro in October 2017. Auro initially developed and operated driverless shuttles for private geo-fenced locations such as corporate and university campuses. The company has since expanded its focus to include passenger vehicle models and minivans, although it still plans to target low-speed urban use cases focused on solving last-mile transportation.
The company’s real-world trials will start on Ford Fusion vehicle platforms equipped with Auro’s autonomous driving system.
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