Aemetis Receives Approval to Construct Sustainable Aviation Fuel Plant in Central California

Renewable natural gas and fuel producer Aemetis was approved to construct a sustainable aviation fuel (SAF) plant in Riverbank, California. The Silicon Valley-based company will have its primary production facility in central California, approximately one hour and 30 minutes away from the San Francisco Bay Area by car. 

The Plant

The plant can produce 90 million gallons of fuel annually when 50% of operations are SAF and the other 50% is renewable diesel. This capacity becomes 78 million gallons annually when production is 100% devoted to SAF. The San Joaquin Valley Air Pollution Control District allowed the plant's construction after an extensive review period, which included consulting the public.

The City of Riverbank approved Aemetis's Use Permit and California Environmental Quality Act (CEQA) review after finishing the aforementioned review period in September 2023. Aemetis required both permits to proceed with the engineering and financing needed to construct a plant.

Aemetis' CEO and Chairman Eric McAfee said about the company's goal with the plant:

"Building our sustainable aviation fuel business is a high priority to meet rapidly increasing global demand for SAF from airlines. Achieving this essential permitting milestone is a critical step in advancing the project to financing, procurement, and construction. Reflecting the positive environment for replacing petroleum jet fuel with SAF, the $380 billion Inflation Reduction Act includes specific SAF tax credits to support this type of project, and the USDA has provided financing support for other Aemetis renewable fuels projects to enable attractive 20-year guaranteed funding from lenders."

Riverbank's mayor, Richard O'Brien, outlined how the project will benefit the local economy by providing hundreds of jobs and helping reduce carbon dioxide emissions. The city is located in the Central Valley, which has suffered from poor air quality for years. Many cities in the region, including Fresno and Bakersfield, regularly rank among the most polluted cities in California and the entire country. O'Brien noted that the new plant will enhance the Central Valley's air quality.

The Riverbank Industrial Complex, where the plant will be located, is spread across 125 acres (51 hectares). Aemetis previously acquired 24 acres (10 hectares) of the site to develop a Carbon Capture and Sequestration injection well in July 2022. An Aemetis subsidiary originally signed an agreement to lease or purchase the complex in December 2021. 

Future Plans

In 2022, Aemetis outlined a five-year plan for its proposed SAF and renewable diesel plant. The company expects the Riverbank facility to generate $672 million in revenue and $195 million in adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) by 2027. The new facility will use renewable hydrogen, hydroelectric power, and renewable oils to produce fuel with low and negative carbon intensity. Although Aemetis has other plants in California and India, the Riverbank facility is the company's first one devoted to decarbonizing the aviation industry.

The company has also signed $3.8 billion of SAF supply contracts with airlines. These carriers include Alaska Airlines, Aer Lingus, British Airways, Cathay Pacific, and Finnair. Aemetis expects to significantly contribute to California's SAF ambitions, with major airports like San Francisco (SFO) and Los Angeles (LAX) outlining their own plans to incorporate SAF into their operations.