Washington state has awarded a new $1.5 million grant for a planned sustainable aviation fuels and renewable diesel production facility projected to open in 2029 at Wallula Gap on the Columbia River.

That’s a very small portion of the funding required to complete the facility being developed by Dutch company SkyNRG. In 2023, SkyNRG’s then-CEO said the project will require an investment of $600 million to $800 million.

SkyNRG’s website on the planned facility, which it calls Project Wigeon and is located in the Columbia Basin near Walla Walla and the Tri-Cities, states that funding is being “secured from existing investors.”

Sustainable aviation fuel, or SAF, is jet fuel made from sustainable resources that can be mixed with fossil jet fuel to reduce life-cycle carbon emission s from aircraft.

SkyNRG plans to produce SAF and diesel from biogenic methane, using waste from municipal landfills, sewage treatment facilities and manure from animal farms.

SkyNRG said in 2023 it had chosen Washington state for a major biogas plant to produce sustainable aviation fuel, citing the state’s climate policies that provide financial incentives.

The legislation includes tax credits that will provide subsidies of $1 to $2 per gallon of SAF, which currently costs two to three times more than the average of $2.35 per gallon for regular jet fuel, according to the latest data from trade group Airlines for America.

The state legislation also accelerates permitting and environmental review for construction of clean energy plants.

“This project aligns with our strategic growth priorities around clean technology,” said Joe Nguyen, director of the Washington State Department of Commerce, adding that it also “creates family-wage manufacturing jobs that strengthen the local economy.”

The location of the proposed facility was revealed in November when the Port of Walla Walla agreed to sell SkyNRG the 165-acre site at Wallula Gap for about $10.7 million, according to a Port staff report on the purchase agreement.

SkyNRG’s website says the site, currently flat, bare agricultural land, is now undergoing environmental review by the state Department of Ecology and Walla Walla County.

The SkyNRG plan shows large tanks and pools in one area of the site where the waste is digested to produce the biogas. This is then processed into either SAF or diesel in a separate section of the site.

Other potential large industrial projects are earmarked for the same area, including a major data center and plants for manufacturing batteries and building insulation.

A news release from Gov. Bob Ferguson’s office touted SkyNRG’s projection that the plant should provide 600 jobs during construction and 100 production jobs when it is operational.

Slow SAF production misses targets

The airline industry has targeted increased SAF production to provide up to 65% of the necessary carbon emission reductions needed to achieve its goal of net zero emissions by 2050.

However, the pace of SAF production worldwide has been glacially slow.

In December, the International Air Transport Association, which represents global airlines, estimated that in 2024 global production of SAF was 343 million gallons.

That’s just 0.3% of global jet fuel production and well below the 500 million gallons that had been projected earlier.

Seattle-Tacoma International Airport alone uses 600 million gallons of jet fuel annually.

Explaining last year’s disappointing shortfall in SAF production, IATA said “key SAF production facilities in the U.S. have pushed back their production ramp up to the first half of 2025.”

However the SkyNRG project is far behind even that schedule. Construction of the Wallula Gap facility is expected to begin only in 2026, with production of SAF and renewable diesel beginning in 2029.

SkyNRG said it plans at peak to produce 50 million gallons of SAF a year, which will then be shipped to West Coast airports.

A smaller SAF plant developed by Silicon Valley startup Twelve is under construction in Moses Lake in Central Washington.

Twelve CEO Nicholas Flanders said last week that construction “is progressing rapidly and we anticipate finalizing by the end of this year.”

Twelve, named for the atomic mass of carbon, developed a process to make SAF using renewable electricity, water and waste biomass CO 2. It broke ground on the Moses Lake facility, its first, in 2023.

In September, Twelve raised $645 million in new funding and last week announced an additional $83 million boost to the construction loan for the Moses Lake plant, which when operational will employ about 20 people.

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