The aviation industry has long faced one of the most significant challenges in the energy transition: reducing emissions. However, a new wave of innovative startups is bringing fresh solutions to the table, and Wall Street is taking notice. One of the most notable companies in this space, Twelve, recently raised a staggering $645 million from high-profile investors, including Alaska Airlines and private-equity firm TPG. With this latest investment, Twelve joins the exclusive ranks of “unicorn” startups, valued at over $1 billion.
eFuels: The Future of Aviation
Twelve is part of a growing group of companies pioneering the development of eFuels—synthetic fuels created through a process that mimics photosynthesis. These fuels are produced using carbon dioxide, water, and renewable electricity, offering the aviation industry a cleaner alternative to conventional jet fuel. With emissions reductions of up to 90%, eFuels present a promising solution for long-term sustainability in aviation.
Other companies like Infinium and Prometheus Fuels are also making significant strides. Infinium recently secured a $200 million investment from Brookfield Asset Management, with the potential for an additional $850 million, while Prometheus has already secured a deal to supply American Airlines with low-emission fuels.
Industry Investment Surge
The surge in investment for companies like Twelve and Infinium highlights a broader trend in the aviation sector: a shift toward power-to-liquids technologies. These technologies offer the potential to produce limitless amounts of clean jet fuel, provided there is enough renewable energy to power the process. Investors are betting big on these innovations, with companies like HIF Global and LanzaJet also receiving massive funding.
This investment wave is critical to scaling up production and eventually meeting the aviation industry’s vast demand for cleaner fuels. Currently, global jet fuel consumption exceeds 100 billion gallons annually, and while eFuel production is still in its early stages, the industry’s capacity is growing rapidly. Twelve’s first plant, set to open next year in Washington, will produce around 50,000 gallons of jet fuel annually. Though small in comparison to the overall market, this plant is a stepping stone toward more significant production volumes in the future.
Addressing the Challenges
While the potential for eFuels is enormous, the industry faces several challenges, including high production costs and the need for abundant green power. Twelve’s Washington plant benefits from local hydropower, giving it an edge in efficiency. However, scaling up production will require access to more renewable energy, a constraint that the industry must navigate.
Fortunately, government subsidies and incentives are helping to close the cost gap between clean jet fuels and conventional fuels. The U.S. climate law passed in 2022, alongside state-level incentives, provides critical support for clean fuel producers like Twelve. With additional backing from airlines like Alaska Airlines, British Airways, and Southwest Airlines, the future of eFuels looks brighter than ever.
VURDHAAN’s Role in Aviation Sustainability
As the aviation sector undergoes this transformation, VURDHAAN is actively involved in supporting the adoption of Sustainable Aviation Fuels (SAF) and other innovative solutions like eFuels. Through our expertise in CORSIA, SBTi, and ReFuelEU, we help airlines and aviation stakeholders navigate the complex regulatory landscape and accelerate the shift toward cleaner skies.
Our three-step methodology—Support, Educate, and Implement—ensures that aviation companies are not only compliant with evolving regulations but also equipped with the tools and knowledge to drive sustainability forward. By staying at the forefront of industry innovations, we empower our clients to adopt cutting-edge technologies like eFuels, contributing to a greener future for aviation.
A Greener Horizon for Aviation
With companies like Twelve leading the charge and investors backing the clean fuel revolution, the aviation industry is on the cusp of a significant transformation. eFuels, synthetic fuels, and power-to-liquids technologies hold the key to reducing the sector’s reliance on fossil fuels, slashing emissions, and ensuring long-term sustainability.
As these innovations continue to gain momentum, the future of aviation is set to be cleaner, more efficient, and increasingly aligned with global climate goals. The energy transition may be a challenging journey, but with the right technologies and investments, the aviation sector is well-positioned to achieve its sustainability targets.