Technical and economic assessment of producing sustainable bio-jet fuel in Malaysia

The aviation industry has implemented targets to reduce their greenhouse gas emissions footprint, in which, some of these measures are known as marketbased measures (MBM). This effort to enact decarbonisation of the industry is mainly accounted by certified “drop-in” fuel, also known as alternative sustainable fuel or bio-jet fuel. Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), has placed carbon taxation on airline operators and the industry is at a tipping point to balance increase in air traffic and the cost of carbon emission. Production of enough bio-jet fuel could curb the cost of carbon emission; however adequate sustainable bio-jet fuel needs to be produced to meet a growing demand. Therefore, this study investigates the availability of sustainable biomass in Malaysia, evaluating the best conversion process, and determine the economic feasibility to produce a minimum quantity of bio-jet fuel. For Malaysia, the based quantity to produce is at least 2% of its annual consumption, which is roughly 60,000,000 million litres of bio-jet fuel (40 to 50 million kg of bio-jet fuel). Certified bio-jet fuel is currently only certified through 5 pathways (ASTM D7566), each of which has its set of preferred feedstock, economics, and technology maturity level. Assessment from these 5 technologies was performed from two aspects, (i) technological (maturity, process complexity, etc.) and (ii) economical, using through cost simulation, Discounted Cash Flow Rate of Return (DCFROR), and business potential for the country. It has been identified through analysis that two possible routes are possible for Malaysia as a country to take. For an oil-based route, a mature and cost-effective process known as Hydro-processed Esters and Fatty Acids (HEFA). For carbohydrate route, certified processes known as Fischer-Tropsch can be deployed. The acceptable price ranges from the industry, namely AirAsia and Malaysian Airlines, is to have Kerosene Jet A-1 grade fuel to be not above USD 0.70 per litre of fuel. With feedstock corresponding from 20% to 40% of the cost of production, the cost of production for bio-jet fuel (Jet A-1 grade) is considered higher than conventional jet fuel (fossil fuel based). Through a cost sensitivity analysis, it has been determined that a biorefinery using HEFA technology will have an investment of USD 122,941,946 (MYR 489,310,789), considering Cost Index and Location Factor to Malaysia. This plant will require a feed-in of 55,556 to 71,429 tonnes of sustainable oil per year. For a FT- plant, an investment cost of USD 304,300,041 is required, or MYR 1,211,118,728, with a feed-in between 238,095 to 384,615 dry tonnes of lignocellulose per year. This study calculates that for FT, a general investment of 6086 USDCAPEX/tonneJet Fuel, and 2,460 USDCAPEX /tonneJet Fuel for HEFA, through a DCFROR analysis, backed up by process study and modelling. As for feedstock, HEFA feedstock will require to be lower than 475 USD/tonneFeed(Oil), and for FT feedstock to be lower than 32 USD/tonneFeed(Lignocellulose). Considering feedstock price (HEFA) and plant capital cost (FT), the study shows the potential to meet industrial demand (USD 0.70 per litreFuel), with ideal plant parameters. From the study, HEFA has the highest potential for implementation and meeting industry’s requirements.

Text 116936.pdf Download (1MB) Official URL or Download Paper: http://ethesis.upm.edu.my/id/eprint/18300

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