For U.S. corn farmers, the rise of green jet fuel is their best hope of staving off an existential threat.
With battery-powered cars lowering gasoline demand by 2040, corn-ethanol makers need to find new markets. Roughly 40% of the country's output of the grain is used to make the biofuel that's blended into gasoline.
That's why some producers are betting on a nascent technology that promises to use ethanol to power planes.
"It's a lifeline," said Patrick Gruber, chief executive officer of renewable fuels producer Gevo Inc., which is building an $850 million plant to make green jet fuel from corn. "It creates an outlet for ethanol and it's actually huge."
The search for new uses for ethanol represents a pivot for an industry that has been powered by the force of the U.S. government for almost half a century. Even with disputed environmental credentials, the federal government has subsidized corn ethanol as a way to curb tailpipe emissions and promote energy security.
Now President Joe Biden is throwing his weight behind electric vehicles, prompting biofuel makers and crop traders like Archer-Daniels-Midland Co. to pursue investments in sustainable aviation fuel, or SAF.
If it all works out, the U.S. market for converting ethanol and other alcohols to jet fuel could grow to about $105 billion by 2050, according to BloombergNEF. That's because the likes of United Airlines Holdings Inc. and other major carriers are under pressure to cut greenhouse gas emissions.
But for now, ethanol has yet to be used for aviation fuel at commercial scale, and it's not even clear whether ethanol-derived sustainable aviation fuel will be eligible for tax breaks.
Ethanol consumption is set to fall 12% by the end of this decade and almost 90% by 2050, according to BNEF, mirroring a drop in gasoline demand as electric vehicles become more popular and gasoline engines more efficient.
Ethanol producers are facing a "make-or-break moment," U.S. Agriculture Secretary Tom Vilsack said this month at a forum held by ethanol lobbying group Growth Energy. "The future of this industry is in fact linked to its capacity to take advantage of this new and amazing opportunity."
Some farmers are skeptical. Nick Pingsterhaus, a corn grower in Illinois, sees green aviation fuel as a promising development.
"It is a good thing to have another player bidding on our grains by the river, but if the government has to pay for it, is this really a profitable long-term plan?" the second-generation farmer said.
Failure to seize the moment would be another blow to U.S. corn farmers, who handed the exporting crown to Brazil this year and might never get it back. Several factors are behind that shift, including rising costs, the lingering effects of former President Donald Trump's trade war with China and a stronger dollar.
Still, many ethanol advocates reject the idea the industry needs saving, arguing that liquid motor fuel will be needed for the foreseeable future. Further, producers are hopeful for higher export sales and lobbyists are pushing for U.S. policy they say could help expand year-round sales of the fuel nationwide.
The potential market for sustainable aviation fuel from ethanol is huge. If all the surplus supply of the U.S. biofuel were diverted into sustainable jet fuel, it would make almost 7 billion gallons of sustainable aviation fuel, or 17% of the country's projected jet fuel demand by 2050, according to BNEF analyst Jade Patterson.
Biden signaled support for crop-based sustainable aviation fuel in a July speech, saying he expects farmers to provide 95% of all sustainable aviation fuel in the next two decades. The White House is calling for sustainable jet fuel output in the U.S. to jump to 3 billion gallons a year by 2030, up from 15.8 million last year.
Airlines are setting aggressive goals for sustainable jet fuel as they chase net-zero carbon targets. Delta aims for sustainable aviation fuel to make up 10% of its aviation fuel consumption by 2030 and 95% by 2050. United Airlines plans to convert completely to sustainable aviation fuel by 2046.
If ethanol demand for aviation fuel takes off, the market has potential to "more than make up" for the forecast decline in motor fuel demand amid the transition to EVs, Scott Irwin, an agricultural economist at the University of Illinois, said in an interview.
There's a long way to go. Overall, sustainable jet fuel accounts for less than 0.1% of the fuel used by major U.S. airlines.
"Right now the biggest challenge we face is supply and scaling the infrastructure necessary to increase the supply" of green jet fuel, whether from ethanol or other sources, Rohini Sengupta, head of decarbonization at United Airlines, said in an interview.