Forget the Navy's $26 a Gallon, the Air Force Paid $59 for Biofuel

The US Navy was recently lambasted by Republicans for spending $26 a gallon on biofuels during the recent RIMPAC international naval exercises; all part of its Great Green Fleet Demonstration. However little note was taken when last month the US Air Force spent $59 a gallon on biofuels to prove that alternative fuels can be used in its military aircraft; once the small price difference issue has been addressed – petrol trades at about $3.60 a gallon.

Admittedly the $639,000 the Air Force spent pales in comparison to the $12 million spent by the Navy, but the individual price per gallon is far larger. Although Keff Sheib, the vice president of Gevo, the company from whom the Air Force bought the fuel, said that the 11,000 gallons purchased were so expensive because they were from a small demonstration plant which only produces 7,500-8,000 gallons a month. Once a new, commercial sized refinery has been completed, expected to be 2015, “we believe we can be cost competitive on an all-in basis with petroleum jet fuel over the life of a contract,” he said.

By. Charles Kennedy of Oilprice.com