California-based Fulcrum BioEnergy announced plans for the $600 million alternative fuel plant in Gary. Construction is not expected to start until 2020. But once operations begin, likely 18 months to two years later, Fulcrum said the plant could create about 33 million gallons of fuel from 700,000 tons of waste each year.
Chicago-based United, which invested $30 million in Fulcrum in 2015, will have the chance to purchase 15 million of those gallons and is “fully planning to exercise those rights,” said Aaron Robinson, the airline’s senior manager of environmental strategy and sustainability.
It’s not yet clear which airports could end up getting the biofuel, since that will depend in part on where it makes the most financial sense for Fulcrum to ship the fuel, Robinson said. Some states offer incentives to companies delivering biofuels, and Illinois isn’t currently among them, he said.
The Gary plant, which is expected to employ 160 full-time workers at an average wage of $29 per hour, would be Fulcrum’s second facility. A plant near Reno, Nev., is under construction and expected to begin operations in 2020.
United’s agreement with Fulcrum will ultimately give the airline the right to purchase as much as 90 million gallons per year from six plants, not all of which have been built. The cost is competitive with traditional jet fuel, Robinson said.
The 15 million gallons United could end up buying from Fulcrum’s Gary plant would be a drop in the bucket for the airline, which consumed more than 2.5 billion gallons in the first nine months of this year. But replacing some traditional jet fuel with biofuel is part of the airline’s strategy for hitting a goal announced in September: slashing its greenhouse gas emissions in half by 2050.