Gevo, Inc. (NASDAQ: GEVO) and Future Energy Global (FEG) are pleased to announce the signing of a pioneering carbon reduction attribute purchase agreement, which will enable airlines and other businesses to reduce their CO₂ emissions through Sustainable Aviation Fuel (SAF). Under the multi-year agreement, FEG will purchase Scope 1 and Scope 3 emissions credits from Gevo for 10 million gallons of fuel per year to be produced at Gevo’s alcohol-to-jet (ATJ) SAF production facility, the Gevo ATJ-60, to meet demand from FEG’s airline and corporate customers seeking to decarbonize their operations. The agreement also includes the option for FEG to increase the purchase at a later date.

This agreement is expected to enable Gevo to finance the construction of its ATJ-60 facility. Gevo has secured a conditional loan guarantee commitment of $1.63 billion (including capitalized interest during construction) from the U.S. Department of Energy’s (DOE) Loan Program Office (LPO) and is raising capital from project-level capital providers. Under development in Lake Preston, South Dakota, ATJ-60 is designed to meet the market need for cost-effective jet fuel while reducing carbon emissions and respond to the growing global demand for jet fuel (SAF). Gevo’s patented plant design is expected to produce 60 million gallons of SAF per year at a production cost similar to conventional jet fuel, but with significantly lower carbon emissions.

The aviation industry has set a goal of net-zero CO₂ emissions by 2050, and SAF is expected to contribute approximately two-thirds of the necessary emissions reductions. However, to achieve this, its production must increase more than 400-fold. SAF is not yet available at all major airports worldwide, so FEG provides Scope 1 credits derived from SAF to airlines that wish to purchase additional SAF but cannot easily obtain it at their own airports. Similarly, when companies purchase and withdraw Scope 3 credits derived from SAF to offset emissions from their business travel, they mitigate the added cost of SAF for airlines and thus allow for a more rapid scale-up of SAF production.

The Greenhouse Gas Protocol defines different “scopes” of emissions responsibility. Emissions from a flight are the direct responsibility of the airline (Scope 1), but a company with staff traveling for business on that flight is responsible for its staff’s share of emissions (Scope 3 or indirect emissions). Separating Scope 1 and Scope 3 attributes from physical fuel, an approach known as “Reserve and Reclaim,” reduces fuel transportation and storage costs, as well as carbon emissions, and opens a global SAF market for both airlines and indirect jet fuel customers around the world seeking to mitigate their emissions.

“Gevo has always planned to leverage the economics of the SAF market to expand our business, and a Reserve and Reclaim market that enables the trading of SAF’s environmental attributes can further accelerate SAF production,” says Dr. Patrick R. Gruber, CEO of Gevo. “Future Energy Global is building precisely this market, encompassing corporate customers, airlines, and aircraft lessors. Aircraft lessors own approximately half of the world’s commercial aircraft, and the Reserve and Reclaim system is a key enabler for them and their airlines to more quickly adopt SAF.”

“FEG’s collaboration with Gevo significantly enriches the portfolio of Reservation and Reclamation solutions we offer to our airlines, lessors, and corporate customers,” said Natasha Mann, CEO and co-founder of FEG. “Scaling SAF production is crucial, and our business model allows us to raise the necessary capital to achieve this. We are impressed by Gevo’s project pipeline, which combines current market-ready technology with additional technologies in development that could increase production efficiency and accelerate SAF expansion.”

FEG’s unique business model brings together investors, suppliers, and buyers to accelerate and scale SAF production globally. FEG generates additional revenue streams by commercializing the carbon credits provided by SAF, strengthening the business case for faster production expansion. FEG’s purchase agreement with Gevo is expected to fill a market need by providing

Press Release By Gevo.

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