Washington (Platts)--26May2011/534 pm EDT/2134 GMT

Commercial adoption of aviation biofuels depends on building supply chains from farms to airlines, US government and industry officials said Thursday.

"The technical part of this is pretty much resolved," said US House Representative Jay Inslee, Democrat-Washington. "We know this works; we know we can fly airplanes. We've flown 747s; we've flown F-18s."

Inslee and representatives of Boeing, Alaska Airlines and the Department of Agriculture spoke at the US Capitol about a study weighing the potential for a biofuels industry in the Pacific Northwest. The report estimated regional demand of 1 billion gallons of total jet fuel, both petroleum and biofuels, by 2030 and found plentiful renewable feedstocks in the area -- oilseeds, waste wood, algae and trash.

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Keith Loveless, Alaska Airlines' vice president and general counsel, said biofuels represent airlines' only option for cutting carbon emissions and reducing volatile energy prices. Alaska Airlines' fuel costs surged 47% in the first quarter, compared to the same quarter in 2010, he said.

"There really are no alternatives on the horizon," Loveless said. "We don't have anything like an electric car. You're not going to see solar panels on wings anytime soon. So we really need to prioritize the application of biofuels to the aviation sector."

Billy Glover, Boeing's vice president of environment and aviation policy, said the study's findings extend beyond the Northwest and should indicate that the US biofuels industry is on the verge of taking off.

"It just feels like we're at a tipping point and we're going to see an acceleration," said Glover, adding that government must continue to fund loan guarantees and other efforts to boost research on feedstocks and refining.

Boeing wants to see renewable sources generate 1% of worldwide aviation fuels, or about 650 million gallons, by 2016, Glover said. "When we get to 1%, we'll have a much better idea of how to get to 5 and 10 and 20," he said.

The report was funded by Boeing, Alaska Airlines, the Spokane International Airport, the ports of Portland and Seattle, and Washington State University.

Dallas Tonsager, the USDA's under secretary for rural development, said biofuels backers will have to stick around for the long haul -- working to constantly build capacity, keep conservation issues in mind and build confidence in financial markets.

John Gardner, a vice president of Washington State University, who led the study, said the government also must continue to push research along.

Earlier this month, the Defense Logistics Agency, the military's fuel-buying division, put out a request for proposals to produce 450,000 gallons of renewable jet fuel and renewable diesel to be delivered in Seattle. Separately, the USDA is accepting applications until next week for a batch of loan guarantees to build refineries for advanced biofuels.

"These are the small bites that we hope will make this a reality within the next few years from a commercial delivery perspective," Gardner said.

--Meghan Gordon, meghan_gordon@platts.com