Biofuels are getting ready for take-off in the airline industry.
Cathay Pacific is banking on the hope that biofuels will cost the same as the standard fuel, kerosene, by the end of the decade - and then grow even cheaper. Kerosene now accounts for about 35 per cent of most airlines' operating expenses.
The Hong Kong airline is considering developing a biofuels supply chain in Asia for itself and its subsidiary Dragonair. If it could cut its fuel costs in half, it would save more than HK$14 billion per year, based on the airline's figures for last year.
According to a recent South China Morning Post report, the company might do much more than consume biofuels, it might create them - producing feedstock, refining the oil, building oil-storage facilities and transporting fuel to its base in the city for blending with kerosene (aircraft can only use biofuels as a 50-50 mix with kerosene). With a single refinery costing between US$300 million and US$500 million, this could be a multibillion-dollar investment for Cathay.
Overseas, KLM Royal Dutch Airlines has been using biofuel derived from used oil on 200 flights between Amsterdam and Paris.
Lufthansa just finished a six-month trial, making more than 1,000 successful biofuel trips between Hamburg and Frankfurt. The good news: it reduced carbon-dioxide emissions by more than 1,500 tonnes.
For an industry that is so heavily dependent on the price of oil and looking for ways to reduce its carbon-dioxide footprint, biofuels would seem to be the ideal answer. There is just one problem: what's going into the fuel tank could be feeding hungry people in the developing world.
This is a potentially volatile issue. A couple of years ago, Mexico's President Felipe Calderon blamed the soaring cost of tortillas in his country on a reduction in corn imports after the United States stepped up production of corn-based bio-diesel.
The solution may lie with algae. Algae-based fuel, made by extracting and refining the oils - called lipids - that algae produce as they grow, would not compete with food crops. Compared with corn, algae can produce 80 times more oil per hectare per year.
The problem would be a lack of water. But if we're smart about where we grow the algae, we can drastically reduce the amount of water needed for algae biofuel.
Dr Mark Wigmosta from the US Department of Energy's Pacific Northwest National Laboratory in Richland, Washington state, found that the best solution is if algae are grown in the US regions that have the sunniest and most humid climates: the Gulf coast, the southeastern seaboard and the Great Lakes.
Algae can also be grown in salt water and covered ponds.
The scientists developed a national geographic-information system to identify areas better suited for algae growth: places with flat land that isn't used for farming and isn't near cities or sensitive areas like wetlands or national parks.
Next, the researchers gathered 30 years of meteorological information. That helped them to determine how much sunlight algae could photosynthesise and how warm the ponds would become.
They found that in total, 80 billion litres of algae oil could be produced with American home-grown algae. That's the equivalent of 17 per cent of the petroleum that the US imported in 2008 for transportation fuels. It could be grown on land roughly the size of South Carolina. South Carolina is a pretty large chunk of land, so this doesn't sound practical at first glance. But the area might be in coastal areas with salt water.
As carbon dioxide-consuming organisms, algae can feed off carbon emissions from power plants. Algae also digest common water pollutants like nitrogen. That means algae can also grow in - and clean - municipal waste water.
Killing two birds with one stone: US-grown oil plus environmental protection.
Reinhard Renneberg has been a professor of bioanalytical chemistry at Hong Kong University of Science and Technology since 1994
The amount, in litres, of biofuels produced in 2010
- This represented a 17 per cent increase on the year before