United Airlines Ventures (UAV), the sustainability-focused investment vehicle of United Airlines, is investing up to $37.5 million in NEXT Renewable Fuels, a Houston-based company which is building a biofuels refinery in Port Westward, Oregon, and targeting production from 2026. The deal is the fifth investment made by United’s ventures fund in sustainable aviation fuels technology. The airline says it is the first direct investment by a major US carrier in a renewable fuel biorefinery. Subject to environmental approvals, the NEXT plant expects to produce up to 750 million gallons per year, or 50,000 barrels per day, of SAF, renewable diesel and other fuels. For UAV, a key attraction of the refinery, NEXT’s first project, is its proximity to multi-modal transport infrastructure, including a deepwater port and facilities, which provides easy access to fuel feedstock supplies and distribution to high-demand markets on the US West Coast, where multiple SAF supply deals have recently been signed with corporate, domestic and international air operators.
Supplies of SAF are both scarce and expensive, currently costing at least three times as much as conventional aviation fuel. The US government, in its recently-released SAF Grand Challenge Roadmap, forecast domestic aviation demand for 3 billion gallons of SAF by 2030 and 35 billion gallons by 2050 – with just 5 million gallons produced last year – and announced a range of incentives to expedite the development of infrastructure and new renewable fuel types.
“Right now, one of the biggest barriers to increasing supply and lowering costs of sustainable fuel is that we don’t have the infrastructure in place to transport it efficiently,” said Michael Leskinen, President of United Airlines Ventures. “NEXT’s strategic location and assets solve that problem and provide a blueprint for future facilities that need to be built. We believe this investment will not only bolster NEXT’s ambitions and create near-term solutions to expand our SAF supply, but further demonstrates our commitment towards producing SAF at the scale necessary to decarbonise the aviation industry.”
NEXT has an agreement with BP to source 100% of its feedstock for renewable fuels, significantly reducing supply risks faced by smaller facilities, and has received an air quality permit from the State of Oregon. Construction of the new plant is expected to begin once an Environmental Impact Statement is completed by the US Army Corps of Engineers. Once the facility is completed and operating, NEXT says it has potential to scale up SAF production and to deploy additional future technologies for renewable fuels.
“The clean fuels industry is taking off and our access to feedstocks, multi-modal distribution and major industry players positions us to be a leading SAF supplier of the West Coast,” said NEXT’s CEO, Christopher Efird. “United’s investment in NEXT strengthens our resolve to be one of the clean fuels leaders in the transportation sector.”
Scott Kirby, United’s CEO, has resisted the use of traditional carbon offsets in meeting its net zero by 2050 goal, preferring to decarbonise “not with flashy, empty gestures, but by taking the harder, better path of actually reducing emissions from flying.” Of UAV’s role as an aviation investment fund focused on sustainability and technology, Kirby said: “We realise there’s a limit to what a single company can do alone. That’s why we are continuing to seek opportunities to collaborate with other industries. We must reach across industries to develop coordinated efforts to accomplish what must be our collective goal of carbon neutrality.”
Prior to the NEXT investment, which is subject to achievement of specific milestone targets, United or UAV had announced investments in or partnerships with emerging SAF developers and suppliers Fulcrum BioEnergy, Dimensional Energy, Cemvita Factory and Alder Fuels, as well as the Swedish electric plane manufacturer Heart Aerospace, hydrogen propulsion pioneer ZeroAvia and electric air taxi developers Archer and Eve Air Mobility.
The airline is also one of the biggest buyers of SAF, with multiple major offset deals, and last year became the first to operate a commercial flight with 100% SAF in one engine – a Boeing 737 Max 8 service from Chicago to Washington DC. As well, through its Eco-Skies Alliance programme, 30 of the airline’s corporate customers have collectively purchased more than 7 million gallons of SAF to further help fund the fuel while offsetting the carbon emissions of their corporate air travel.
Image: United Airlines