One of Houston’s up-and-coming clean technology companies has secured United Airlines (Nasdaq: UAL) as a customer for its sustainable aviation fuel.
Chicago-based United agreed to buy up to 50 million gallons of SAF annually for 20 years, for a total of up to 1 billion gallons, from Houston-based Cemvita Corp., the companies said Sept. 13.
United, one of Houston's busiest airline, has previously invested in Cemvita as part of its push to acquire more sustainable aviation fuel. The airline's venture arm, United Airlines Ventures, also launched a $100 million investment fund targeting SAF technology and startups, which saw investments from Air Canada and The Boeing Co. (NYSE: BA) as well as JPMorgan Chase & Co. (NYSE: JPM) and Honeywell International Inc. (Nasdaq: HON).
The fund is a beneficiary of the federal Inflation Reduction Act signed into law last year, which includes a tax credit designed for SAF and decreases costs for the fuel’s consumers. According to S&P Global Platts, sustainable fuels are about three times the cost of jet fuel, which cost around $146 a barrel as of February.
Researchers have noted airlines’ difficulties in acquiring SAF due to competition with other users of the biomass that serves as a key ingredient. The same plants used to make SAF are also used for ethanol, other forms of biodiesel and food for livestock.
While current SAF is produced from used cooking oil and agricultural waste, Cemvita uses a library of engineered microbes to convert carbon dioxide into its eCO2 Oil, which Cemvita CEO and co-founder Moji Karimi said is made into SAF through an existing chemicals process. Karimi said the technology minimizes the use of land space and resources needed to produce sustainable fuel.
Karimi confirmed to Houston Inno that Cemvita would complete the full-scale plants used in the United deal around 2028 or 2029. The company is evaluating locations for the plants based on carbon dioxide availability, but Karimi said staying in Houston would be ideal.
In April, Cemvita launched a pilot plant near its office in Houston to demonstrate its technology. The plant, also known as the eCO2 Process Innovation Center, can be used as a baseline for future plant designs that can be reproduced and sold to be installed on existing energy campuses or pipelines, or even at a different source of carbon dioxide. According to Cemvita officials, the plant can capture carbon dioxide emissions either at a point-source level, such as flue gas from a refinery, or at a bulk-source level from a pipeline.
Moji Karimi and his co-founder and sister, Tara, have been working on Cemvita’s technology for most of the past decade after exploring its application in the energy field. Moji Karimi, who previously worked in the oil and gas sector and had experience on drilling rigs, said part of the challenge pitching the technology was finding receptive audiences.
One of those audiences was Houston-based Occidental Petroleum Corp. (NYSE: OXY) and its CEO, Vicki Hollub. Early meetings with Hollub and Oxy led to a 2021 collaboration for an ethylene plant developed by Cemvita with aid from the energy giant’s investment arm, Oxy Clean Ventures.
A 2022 report by the International Energy Agency found the use of vegetable oil for biofuel production is already rising worldwide, with a projected increase of 46%, or 54 million tonnes, from 2022 to 2027. Biofuels are especially targeted for marine, aviation and heavy trucking applications because few alternatives currently exist, the Paris-based intergovernmental agency's report said.
