The U.S. Department of Energy (DOE) has made a conditional commitment to a $1.46 billion loan guarantee for Gevo Net-Zero 1, LLC (Gevo NZ-1) to finance the construction of a pioneering corn starch-to-sustainable aviation fuel (SAF) facility in Lake Preston, South Dakota. This project is the first large-scale SAF production facility in the U.S. to use corn starch as feedstock, integrated with carbon capture and renewable energy technologies to produce SAF, renewable diesel, and naphtha.
Gevo’s Impact on the U.S. SAF Landscape
The Gevo NZ-1 facility is projected to produce up to 60 million gallons of SAF annually, doubling the current U.S. SAF production capacity. The fuel produced at this facility will achieve a significant reduction in greenhouse gas emissions compared to conventional jet fuel. According to Gevo’s analysis using the 40BSAF-GREET model, the SAF produced will prevent over 600,000 metric tons of CO2e emissions each year.
The facility will rely on U.S.-grown, low-carbon corn as feedstock, benefiting from its proximity to local farmers in South Dakota. Gevo’s GROWERS program incentivizes farmers to adopt climate-smart agricultural practices, further reducing the carbon intensity of the feedstock used for fuel production.
“The SAF market is expected to grow rapidly as airlines worldwide commit to net-zero by 2050, and Gevo’s Net-Zero 1 facility will help meet that demand, doubling U.S. SAF capacity.” — DOE Loan Programs Office
Supporting the SAF Grand Challenge
This project directly supports the goals of the SAF Grand Challenge, a joint initiative of the DOE, Department of Transportation, and U.S. Department of Agriculture. The Grand Challenge seeks to scale U.S. SAF production to 3 billion gallons per year by 2030 and 35 billion gallons by 2050. Current SAF production in the U.S. is estimated at 30 million gallons per year, so Gevo’s facility will make a substantial contribution toward this target once operational.
Economic and Environmental Benefits
Gevo NZ-1 is expected to create significant economic benefits for South Dakota and neighboring states. The project is estimated to generate 1,300 indirect jobs during construction and 100 operations jobs, contributing to local and regional economic growth. Additionally, the facility will produce co-products like high-value protein for animal feed and corn oil, further enhancing its economic impact.
The project is also in line with the Biden-Harris administration’s Justice40 Initiative, which aims to deliver 40% of the overall benefits of federal investments to disadvantaged communities. Gevo has already engaged with local communities and farmers, forming partnerships that support sustainable agricultural practices and economic development.
DOE’s Role in Financing Clean Energy
The DOE’s $1.46 billion conditional loan guarantee will be provided through the Title 17 Clean Energy Financing Program, which supports innovative clean energy projects. The corn starch-to-SAF facility qualifies under the Renewable Energy Systems technology category, marking a significant step forward in the development of biofuel infrastructure in the U.S. As the aviation industry intensifies its focus on decarbonization, SAF is seen as the most viable short-term solution, with other technologies such as hydrogen and battery-powered aircraft still in early stages.
Challenges and the Future of SAF
While the loan commitment represents a significant step, Gevo must still navigate several hurdles, including completing an environmental review and satisfying technical and financial requirements before receiving full financing. Nonetheless, once operational, the Gevo NZ-1 facility is expected to play a pivotal role in decarbonizing the aviation industry, which accounts for 11% of U.S. transportation emissions.
SAF is projected to contribute 65% of the aviation sector’s emissions reductions by 2050, with Gevo’s Net-Zero 1 facility set to be a key player in that effort. The facility’s use of low-carbon feedstocks, renewable power, and carbon capture makes it a model for future projects in the SAF industry.
