Gevo, Inc. and Future Energy Global (FEG) have signed a multi-year offtake agreement aimed at supporting emissions reduction in the aviation sector through Sustainable Aviation Fuel (SAF) credits. Under the agreement, FEG will purchase the Scope 1 and Scope 3 carbon abatement attributes from 10 million gallons per year of fuel expected to be produced at Gevo’s forthcoming alcohol-to-jet (ATJ) SAF facility, ATJ-60, in Lake Preston, South Dakota. The deal includes an option for FEG to expand its offtake in the future.
The agreement is anticipated to play a critical role in enabling the financing of Gevo’s ATJ-60 plant, which is backed by a conditional $1.63 billion loan guarantee from the U.S. Department of Energy’s Loan Programs Office. Once operational, the facility is expected to produce 60 million gallons of SAF annually at a cost comparable to conventional jet fuel but with significantly reduced carbon emissions.
The aviation sector, which has pledged to achieve net-zero carbon emissions by 2050, sees SAF as a central component in meeting this target. Current projections suggest SAF must account for approximately two-thirds of the emissions reductions needed—requiring production to scale up more than 400 times its current output.
FEG’s model allows for the separation and sale of SAF-derived Scope 1 and Scope 3 emissions credits via a “Book and Claim” system, which enables airlines and corporations to offset emissions without direct access to physical SAF at all airport locations. This system not only supports emissions mitigation but also facilitates investment in SAF production by providing credit buyers with pricing certainty and suppliers with revenue assurance.
Explaining the significance of the deal, Dr Patrick R. Gruber, CEO of Gevo, stated: “Gevo has always planned to leverage SAF market economics to scale our business, and a Book and Claim market that enables the trading of SAF environmental attributes can accelerate SAF production even faster. Future Energy Global is building just such a market, spanning corporate customers, airlines, and aircraft lessors. Aircraft lessors own about half of all commercial aircraft worldwide, and Book and Claim is a critical enabler to allow them and their airline customers to adopt SAF faster.”
FEG, which works across the transport sector including marine and land-based modes, aims to use carbon credits derived from SAF to finance further production capacity. CEO and Co-Founder Natasha Mann commented: “FEG’s collaboration with Gevo strongly enhances the portfolio of Book and Claim solutions we can offer our airlines, our lessors and our corporate customers. It’s crucial to scale SAF production, and our business model lets us unlock the capital to do so. We’re impressed with Gevo’s pipeline, which combines technology ready for today’s market and additional technologies far along in development that could increase production efficiency and accelerate the trajectory of SAF scaling.”
The partnership is expected to contribute to the expansion of a global SAF credit market and address growing demand from aviation and corporate sectors for credible emissions reduction mechanisms.
