How many leading environmentalists like Canada’s David Suzuki have stopped flying to reduce their personal greenhouse gas emissions? He could just donate offsets and plant some trees. But aware consumers know that carbon offsets for flying a private jet or globe-trotting is controversial. The best way to travel sustainably is by reducing one’s carbon footprint from the source, which is why SAFs –– or sustainable aviation fuels made from biofuels –– have been so appealing in energy markets.
US-based XCF Global Capital, is poised to make significant strides in bolstering America’s SAFs industry with its latest move towards a going public through a special purpose acquisition company (SPAC).
Global Aviation Biofuel SAF Industry Research Report in 2024 estimates the market to reach $51.23 billion USD by 2028.
“At XCF, we see tremendous growth potential from SAF and renewables. We are very bullish on the sector,” said Mihir Dange, CEO of XCF Global. “We live in an exciting time with so many compelling green energy platforms racing to reduce the globe’s carbon footprint.”
“We are in the very beginning stages of SAF in the United States and XCF is committed to being a leader in this space. Our goal is to change the world for the better while delivering world class returns. We welcome strategic relationships and discussions with all the carriers in this industry and look forward to further defining this landscape.”
Consider that US airlines such as Delta plan on replacing 10% of its jet fuel with SAFs by 2030, while United plans to purchase 10 million gallons of sustainable aviation fuel over the next two years. European energy companies and Middle East oil and gas companies are already in the market: Emirates Airline and Neste, a Finnish oil refining company, are supplying over 3 million gallons of blended Neste MY Sustainable Aviation Fuel this year through to 2025 as part of a pilot.
XCF Global aims to be a leading producer of SAFs with an initial annual production capacity of 38 million gallons following the acquisition of New Rise Renewables, which owns a flagship plant and adjacent site in Reno, Nevada.
XCF will be the only pure-play public SAF producer in the US market, with competition mainly coming from legacy crude oil providers.
What exactly is SAF?
Sustainable aviation fuel is synthetic kerosene derived from non-food feedstocks such as waste oils and fats, green and municipal waste and non-food crops. SAF is able to recycle CO2 absorbed by biomass during its lifetime rather than injecting new carbon into the system, reducing emissions by up to 80%. It easily integrates with existing aviation infrastructure.
The market and appetite for SAFs is growing in the US: In September 2021, the US Government launched the Sustainable Aviation Fuel Grand Challenge, a partnership between the U.S. Departments of Energy, Transportation, Agriculture, and others to achieve full decarbonization in aviation by 2050. The aim is to scale up the production of SAF to 35 billion gallons per year by 2050, with an interim goal of at least three billion gallons per year by 2030.
The Biden Administration is expected to update its SAF policies and strategies any day now.
While it sounds like a dream of Daryl Hannah driving her El Camino by recycled chip truck oil back in 2003, the idea of biofuels from plants or biowaste isn’t far-fetched at all: Studies by McKinsey and The Vacationer note that 40% of consumers are willing to pay 2% more for carbon-neutral tickets, amounting to an average of $20 per $1,000 round-trip. About 80% of consumers say sustainable travel is important to them.
With an estimated billion passengers expected to travel by 2050, the demand for SAFs will be extraordinary and XCF seeks to address the aviation industry’s burgeoning demand with an initial production capacity of 38 million gallons in 2024 and anticipates expanding to over 150 million gallons per year within the next 5 years – positioning the company to be a leading producer of SAF in North America.
XCF Global is based in New York and owns multiple facilities in North America. The company expects to rapidly scale by acquiring more strategically located, smaller-footprint sites and quickly converting them into SAF production facilities.
XCF recently acquired two strategic locations in Wilson, North Carolina and Ft. Myers, Florida. As blended fuel, XCF could produce over 200 million gallons of jet ready SAF from each of these four sites, or altogether nearly one billion gallons of blended SAF per year.
XCF recently announced a definitive business combination agreement to merge with Focus Impact BH3 Acquisition Co. (Nasdaq: BHAC), a publicly traded special purpose acquisition company, which is expected to result in a newly formed holding company of XCF becoming publicly-listed. Read more about the opportunity here.
