Platts launches daily, USGC, ETJ cost-based SAF calculated assessments

Platts, part of S&P Global Commodity Insights, has launched a daily calculated assessment representing the cost of production for US Gulf Coast, Ethanol-To-Jet (ETJ) sustainable aviation fuel (SAF), effective April 24.

The global aviation industry faces increasing pressure to reduce its carbon footprint and meet stringent environmental regulations.

Platts has observed growing interest in Ethanol-To-Jet (ETJ) SAF since it provides a solution to lower greenhouse gas emissions associated with air travel.

The capacity for ETJ SAF is projected to keep growing, driven by rising demand and ongoing investments in production processes.

The ETJ SAF values reflect ASTM D7566 standard specification, with a relative density of 759.5 kg/cu m (at 15 degrees Celsius), basis USGC.

The ETJ SAF values are published in cents/gal. Platts publishes values with and without environmental credits by deducting the federal SAF tax credit and D4 biomass-based diesel RINs.

The values reflect a reference Carbon Intensity (CI) of 45 gCO2e/MMBTU (42.652 gCO2/MJ).

Platts calculates the credit by multiplying the lifecycle greenhouse gas emissions reduction percentage by the maximum credit price, $1.75/gal.

Platts calculates lifecycle greenhouse gas emissions reduction percentage as a fraction, the numerator of which is the maximum carbon intensity 50 kgCO2/MMBTU minus the SAF CI of 45 kgCO2/MMBtu and the denominator of which is the maximum carbon intensity.

The credit is rounded to the nearest hundredth cent.

(50 – 45)/50 x 175 cents/gal = 17.5 cents/gal

Therefore, the total SAF tax credit Platts used in its US Gulf Coast ETJ SAF without credits prices is 17.5 cents/gal.

These calculated values reflect the cost of SAF produced via the Ethanol-to-Jet pathway.

Feedstock considered is ethanol from Brazil's sugarcane and Gulf Coast hydrogen; coproducts include renewable diesel and naphtha/gasoline; and utility costs include Gulf Coast natural gas and electricity.

Platts daily prices for feedstocks, coproducts, and utilities are also taken into account.

The cost-based values follow the Platts US publishing schedule, for days when Brazil there is a publishing holiday in Brazil, but not in the US, Platts takes the last published Brazil ethanol price.

The launch of the new values was first proposed in a subscriber note published March 6, available here: https://www.spglobal.com/commodity-insights/en/pricing-benchmarks/our-methodology/subscriber-notes/030625-platts-proposes-to-launch-daily-usgc-etj-cost-based-saf-calculated-assessments(opens in a new tab)

A decision to launch the assessments was communicated on March 21 in a subscriber note available here: https://www.spglobal.com/commodity-insights/en/pricing-benchmarks/our-methodology/subscriber-notes/032125-platts-to-launch-daily-usgc-etj-cost-based-saf-calculated-assessments-from-april-24(opens in a new tab)

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