The South Humber Bank’s emerging central role in cleaning up aviation has been highlighted as funding of the proposed green jet fuel plant at Stallingborough was officially confirmed.
Velocys secured £27 million to support the development of the consented Altalto refinery, as first reported last week. It is a £350 million scalable plant that will create more than 100 jobs, with many more in construction.
One of five proposals sharing £165 million from the Advanced Fuels Fund, the AIM-listed technology company is also at early development stage on a project looking at carbon capture and hydrogen feedstocks - with the Humber a potential location for that too with an emerging pipeline network for both. It also benefited with a £2.5 million grant, along with substantial awards for plants in Port Talbot, Teesside and Ellesmere Port.
Read more: Leading UK fund manager increases Pensana stake ahead of Saltend big build
The investments come at the end of a year that saw Altalto’s near neighbour, Phillips 66 Humber Refinery, start at-scale production in a UK first. British Airways, partnered alongside Velocys in Altalto, is the customer.
Transport Secretary Mark Harper said: “Using waste or by-products to refuel airliners sounds like a flight of fancy, but thanks to £165 million of Government funding it’s going to help us make guilt-free flying a reality. It’s exactly this kind of innovation that will help us create thousands of green jobs across the country and slash our carbon emissions.”
Velocys is currently raising the necessary funds to deliver the plant as it secures offtake agreements while policy has been ironed out in Westminster. Earlier this summer the Jet Zero Strategy was launched, with representatives of the Oxford University spin-off on the overseeing council.
The Department for Transport released the detail, highlighting how “Immingham will be at the centre of the UK’s push to slash carbon emissions from aviation, with the Government awarding Velocys PLC £27 million to develop a sustainable aviation fuel production facility”.
Domestic waste would be converted into liquid fuel using Velocys’ proprietary technology, with operations anticipated to begin in 2028. A total of 37.4 kt are anticipated a year.
Further to his announcement to the City, Henrik Wareborn, Velocys chief executive, said: “We are encouraged to see that the UK Government is taking seriously the urgent need to transition to lower carbon travel and transport, with its stated ambition of having at least five commercial scale SAF plants under construction in the UK by 2025. Velocys’ intellectual property protected technology provides a pathway to large-scale production of SAF, which is an essential element for achieving net-zero-carbon air travel.”
More than £700 million has been invested by those behind Britain’s flag carrier.
Jonathon Counsell, head of sustainability at British Airways-owning IAG Group, said: “Investing in sustainable aviation fuels is one of the best opportunities our industry has to decarbonise. We’re delighted that Velocys has received crucial financial support in the UK from the Department for Transport Advanced Fuels Fund.
“IAG has committed $865 million in SAF purchases and investments to date. With the right policy support to incentivise further investment, the UK could see many SAF plants built over the next decade, creating 6,500 jobs, and saving over three million tonnes of CO2 per year as well as improving the UK’s energy security.”
Sitting at the heart of its South Humber Industrial Investment Programme, confirmation of the investment from Westminster has been welcomed by North East Lincolnshire Council, the local authority that granted the planning consent back in May 2020. Leader, Cllr Philip Jackson, said: “I’m really pleased to see this announcement for the project. We have been working with Velocys for several years now – investment on this scale will always take a significant length of time, but this will allow the plans to progress to the next stage.
“We have been working to make North East Lincolnshire a top competitor for green energy investment decisions, and we have grown our credentials, both onshore and offshore, greatly in the last few years. We will continue to work with Velocys to land this important project, and help create local jobs for local people.”
The backed projects are forecast to slash CO2 emissions by an average of 200,000 tonnes a year once up and running – the equivalent of taking 100,000 cars off the road. It comes as the UK has formally joined the International Civil Aviation Organization’s assistance, capacity building and training programme for SAF. It will now focus on supporting other countries to help them develop their own SAF industries.
Tim Alderslade, chief executive of trade body Airlines UK, said: "The Jet Zero Strategy was a real statement of intent from the Government that aviation, without the carbon, is an achievable end goal by 2050. This £165 million of funding - alongside the 10 per cent SAF mandate by 2030 - shows the Government shares our ambition of a home-grown SAF industry here in the UK. This could generate tens of thousands of jobs and huge GVA, levelling-up and exports potential for the UK. It's a big prize and one we are committed to working with ministers to achieve."
READ NEXT:
Green jet fuels 'a great opportunity for the Humber' - BA head
High praise for Phillips 66's green agenda from Director General of British Chambers of Commerce
RWE eyeing up carbon capture power station plan for South Humber Bank
SSE expands Humber hydrogen storage plans to production and power generation
All your Humber business news in one place - bookmark it now
