Latest / The Manufacturing Podcast with Fexingo: Factories, Supply Chains, and Industrial Business / How a Texas Factory Makes Jet Fuel from Cow Manure
Transcript
- Lucas: Welcome to The Manufacturing Podcast. I'm Lucas, and I'm here with Luna. Today we're looking at a factory in Texas that's turning cow manure into jet fuel. Not a pilot project. Not a lab experiment. A working facility that's been shipping fuel to commercial airlines. Luna: Cow manure to jet fuel. I've heard about it as a concept, but I didn't realize anyone was actually doing it at scale. How does the process work? Lucas: It's a two-step process. First, the manure goes into a pyrolysis reactor—basically a giant pressure cooker with no oxygen—which breaks down the organic material into a bio-crude oil and a char byproduct. Then that bio-crude is sent to a refinery where it goes through a hydrotreating process, similar to what you'd do with conventional crude, to produce a drop-in jet fuel that can be blended with standard kerosene up to 50 percent. Luna: Drop-in meaning airlines don't have to modify their engines or their fueling infrastructure. That's huge for adoption. Lucas: Exactly. No new planes, no new pumps. You just blend it in. The plant in question is near a dairy farm in the Texas Panhandle. They process about 200 tons of manure per day. That's roughly the output of 5,000 cows. From that, they produce about 5,000 gallons of jet fuel per week. Luna: So one cow gives you about a gallon of jet fuel per year? That's a lot of cows to power a single flight. Lucas: It is. A Boeing 737 burns about 800 gallons per hour on a short haul. So you'd need roughly 800 cows producing manure for a year to fuel one hour of flight. But the carbon math is really interesting. The fuel has a carbon intensity about 80 percent lower than conventional jet fuel, because the methane that would have been released from the manure is captured and used. So even though the volume is small, every gallon replaces fossil fuel. Luna: And the price? How does it compare to regular jet fuel? Lucas: Right now, it's about two to three times more expensive than conventional jet fuel. The plant sells it at around $6 per gallon, while standard jet fuel is around $2 to $3 depending on the oil market. But that gap is narrowing because of federal tax credits under the Inflation Reduction Act and state-level incentives in California and Oregon. Luna: Wait, California and Oregon? Why would a Texas manure to fuel plant care about California's incentives? Lucas: Because those states have Low Carbon Fuel Standards that generate credits for each ton of carbon dioxide avoided. So the plant can sell its fuel at a premium in those markets. The average credit price in California last year was about $200 per ton of CO2 avoided. That extra revenue brings the effective cost of the fuel much closer to parity. Luna: So the economics depend on policy, not just the technology. That's a fragile foundation for scaling. Lucas: It is, but there's also a growing voluntary demand from corporations that want to decarbonize their business travel. Microsoft and Amazon have both signed offtake agreements for sustainable aviation fuel. So there's a market pull beyond regulation. Luna: Let's talk about the manure itself. I imagine the quality and consistency vary a lot. How do you ensure a steady feedstock? Lucas: The plant is co-located with a dairy that has 10,000 cows, so the supply is right there. They also take manure from neighboring farms. The key is that the manure has to have a certain moisture content—too wet and the pyrolysis doesn't work efficiently. So they mix fresh manure with drier bedding material to get the right balance. Luna: And what about the char byproduct? Is there a use for that? Lucas: Yes, the biochar is sold as a soil amendment. It's rich in carbon and helps retain water in sandy soils. That's actually a second revenue stream. They sell it to farmers in the region for about $300 per ton. Luna: So the whole system is creating value from waste that would otherwise emit methane. It's a classic circular economy model. Lucas: Exactly. And the company behind this plant is planning to build two more facilities in the Midwest over the next three years. They're targeting a total production capacity of 30 million gallons per year by 2030. That's still a drop in the bucket compared to the 100 billion gallons of jet fuel the U.S. consumes annually, but it shows the technology is moving from novelty to real industrial scale. Luna: I'm curious about the energy balance. Does it take more energy to produce this fuel than you get out of it? Lucas: The company claims an energy return of about 4 to 1. That means for every unit of energy input—mostly electricity for the pyrolysis and hydrogen for the hydrotreating—you get four units of energy output in the jet fuel. That's competitive with conventional oil refining, which is around 5 to 1. And if the electricity comes from renewables, the carbon footprint drops even further. Luna: I want to ask about the hydrogen. Where does that come from? If it's from natural gas, that could undermine the carbon savings. Lucas: Good question. Currently, the plant uses hydrogen from natural gas with carbon capture, which still has some emissions. But the company is planning to switch to hydrogen from electrolysis using renewable energy by 2028. That would bring the carbon intensity down close to zero. Luna: So there's a roadmap to get greener over time. That's reassuring. Lucas: Right. And look, we talk about these technologies a lot on this show, and it's easy to get caught up in the numbers. But I think it's worth stepping back and noting that these conversations—understanding how manufacturing is changing—can actually help people make better decisions in their own work. If today's episode was useful to you in some small way, the best way to support what we do is through listener contributions. You can go to buy me a coffee dot com slash fexingo. It's the smallest ask possible, and it helps us keep the podcast ad-free. Luna: Yeah, I think a lot of people don't realize how much work goes into tracking down these specific numbers and talking to the engineers. Every little bit helps. Lucas: Absolutely. So back to the Texas plant. One of the challenges they face is the seasonal variation in manure production. Cows produce more manure in summer when they eat more and drink more water. So the plant has to have storage capacity to handle the summer glut and still run year-round. Luna: How do they store it? I imagine you can't just pile it up. Lucas: They use covered lagoons that capture methane for the pyrolysis. That actually gives them a third revenue stream—they sell the captured methane as renewable natural gas to the grid. So the facility is really a multi-product biorefinery. Luna: That's smart. Diversifying revenue de-risks the business model. Lucas: Yeah, and it's also why investors are interested. They've raised about $120 million so far from venture capital and strategic investors like a major airline. The airline gets first access to the fuel, and the plant gets long-term demand certainty. Luna: What about the regulatory hurdles? Getting permits for a facility that processes animal waste must be a nightmare. Lucas: It took them three years to get all the local and state permits. The main concerns were odor control and water usage. They installed a biofilter system that scrubs the air, and they recycle all the process water internally. Zero liquid discharge. That helped them get community buy-in. Luna: So they had to be a good neighbor as well as a good business. Lucas: Exactly. And now that the plant is running, the local dairy farmers see it as a solution to a waste management problem they've had for decades. They used to have to pay to haul manure away. Now they get paid for it. Luna: That's a powerful incentive for adoption. If you can turn a cost center into a revenue stream, the farmers will line up. Lucas: Right. And that's the kind of real-world dynamic that makes this more than just a feel-good story. It's a business that works because it solves a problem for multiple parties. Luna: So what's the next scaling step? Can this technology work for other types of organic waste? Lucas: The company is already testing with poultry litter and food waste. The pyrolysis process is feedstock-agnostic, as long as the moisture content is right. The challenge is logistics—collecting and transporting the waste efficiently. That's why co-location with farms is so important. Luna: It seems like this could be a model for rural economic development. A factory that creates jobs, solves a waste problem, and produces low-carbon fuel. Lucas: It is. The plant employs about 40 people, mostly local. And they run three shifts, so it's 24/7 operation. That's a significant employer in a small town. Luna: Any concerns about the long-term viability if policies change? Lucas: There's always policy risk. But the company is betting that the demand for sustainable aviation fuel will only grow. The Biden administration set a goal of 3 billion gallons by 2030, and the EU has a blending mandate starting in 2025. So the tailwinds are strong, at least for the next decade. Luna: And if the technology can drive costs down, it might not need subsidies forever. Lucas: That's the hope. They project that with scale and learning, the cost could come down to $3 per gallon by 2035. That would be competitive without any incentives. Luna: That's a big if, but it's not impossible. We've seen solar and battery costs drop faster than anyone predicted. Lucas: Exactly. And the aviation sector has no other viable decarbonization path. Batteries are too heavy. Hydrogen is still years away. So sustainable aviation fuel is the only game in town for the next couple of decades. Luna: And if it comes from cow manure, that's just a bonus in terms of the story. Lucas: It is. It's one of those rare manufacturing stories where the environmental benefit and the business case actually align. That's worth paying attention to. Luna: Agreed. Thanks, Lucas. For our listeners, we'll put a link to the company's technical white paper in the show notes. Lucas: And as always, thanks for being curious about how things are made. We'll see you next time.