Environment, permits and carbon intensity

An ATJ plant exists to make fuel with a lower carbon intensity than fossil jet. If its carbon intensity turns out to be close to fossil jet, the plant has no reason to exist, whatever its engineering quality. This lesson therefore treats the environment in two parts. The first is conventional: the emissions, discharges and wastes the plant creates, and the permits it needs to operate at Sarnia. The second is the life-cycle carbon intensity of its products, which decides their value, and which Lesson 12 carries into the economics. Liam leads both parts, with Wren Halvorsen, Kingfisher's environmental lead, as reviewer, building on the CHE-480 study of the ethanol plant.

Emissions, discharges and wastes

Liam starts with an inventory, as CHE-480 taught: every release point, the contaminants it carries and an estimate of their rate at full capacity. For the ATJ plant the list is short but varied.

Compared with the ethanol plant, whose dryers, fermenters and wastewater dominated CHE-480, the ATJ plant is a modest emitter. Its largest conventional air emission is NOx from the fired heater, a few tonnes a year with low-NOx burners. Its most important release risk is from equipment leaks of ethylene, a volatile organic compound that contributes to ground-level ozone, and the plant's hundreds of flanges, valves and seals need a leak detection and repair program from the start. Its process water adds a few tonnes an hour of clean, stripped water to the site's system, and the stripping of Lesson 6 keeps its organic load small.

The spent catalysts deserve a sentence in the report because their metals have value. Nickel and palladium catalysts are normally returned to the catalyst supplier or a refiner for metal recovery, which avoids treating them as waste. The alumina dehydration catalyst, after many regenerations, is a non-hazardous solid if it has been fully decoked.

Permits

The plant needs an amended Environmental Compliance Approval (ECA) for air and noise, supported by an updated ESDM report under O. Reg. 419/05. The fired heater and flare connections are new sources, and the updated dispersion modelling must show that the site still meets Ontario's point-of-impingement standards with the new sources added. The water discharge goes through the site's existing systems and their approvals, which must be amended for the new stream. Wren adds two items. The site will need its emergency planning under the Environmental Emergency Regulations under CEPA updated for the ethylene and hydrogen inventories. And Kingfisher must have the carbon intensity of the new fuel approved under the federal Clean Fuel Regulations before it can create credits for it, which needs a life-cycle assessment by the methods described below, verified by a third party. Liam also checks the federal list of designated projects under the Impact Assessment Act, and finds nothing that a unit of this kind and size would trigger, a conclusion Wren will confirm with counsel.

Life-cycle carbon intensity

The carbon intensity of a fuel is its life-cycle greenhouse gas emissions per unit of energy, in grams of CO₂ equivalent per megajoule. It is calculated by a life-cycle assessment to ISO 14040 and ISO 14044, as CHE-480 described, with a functional unit of one megajoule of fuel and a well-to-wake boundary: growing and transporting the corn, making the ethanol, converting it to jet, distributing the fuel and burning it in an engine. The carbon dioxide from burning bio-based fuel is biogenic, taken from the atmosphere by the corn, and is counted as zero; the emissions that count are those from fossil energy, fertilizer, land use and process chemicals along the chain.

Regulatory programs specify the model and rules to use: the Fuel LCA Model in this case. The team's calculation follows the same structure in a simple spreadsheet-style model, so that the drivers are visible, and states that the regulatory calculation would differ in detail. The ethanol's own carbon intensity is taken from the CHE-480 study: 24 g CO₂e/MJ if the fermentation carbon dioxide is captured and stored, and about 56 g CO₂e/MJ if it is not. The ATJ step adds the fired heater's natural gas, the electricity for compressors and pumps, the hydrogen, which is assumed to be made from natural gas by its supplier, and transport and distribution.

One methodological choice needs care. The plant makes three products, and the emissions must be shared among them. ISO 14044 prefers to avoid allocation by system expansion where possible, but fuel programs usually allocate by energy content among fuel co-products. Here SAF is 78 % of the product energy, and the three products have nearly the same energy per kilogram, so energy and mass allocation give almost the same result.

# Carbon intensity of the ATJ products (energy allocation) and Clean Fuel Regulations credits
hours = 8000
prod = {'SAF': (4.66, 43.4), 'naphtha': (0.72, 44.0), 'diesel': (0.60, 43.2)}   # t/h, LHV GJ/t
E = {k: t * hours * lhv * 1000 for k, (t, lhv) in prod.items()}                 # MJ/yr
Et = sum(E.values())
E_eth = 9.86 * hours * 26.8 * 1000                                              # MJ/yr of ethanol fed
GRID = 40.0                                                                     # g CO2e/kWh
proc = {'fired heater (natural gas)': 7.1e9,                                    # g CO2e/yr, from Lesson 7
        'electricity (1.6 MW)': 1.6 * hours * 1000 * GRID,
        'hydrogen (640 t, from natural gas)': 640e3 * 10.5 * 1000}
TD = 1.3                                                                        # g/MJ transport and distribution
def ci(ci_eth, show=False):
    parts = {'ethanol': ci_eth * E_eth / Et}
    parts.update({k: v / Et for k, v in proc.items()}); parts['transport, distribution'] = TD
    if show:
        for k, v in parts.items(): print(f"  {k:<36} {v:5.1f} g/MJ")
    return sum(parts.values())
print(f"products {Et/1e9:.3f} PJ/yr (SAF {E['SAF']/Et:.0%}); ethanol in {E_eth/1e9:.3f} PJ/yr")
print('with fermentation CO2 captured and stored (ethanol CI 24):')
c1 = ci(24.0, True)
c0 = ci(56.0)
ref = 89.0                                                                      # fossil jet reference, g/MJ (illustrative)
print(f"CI {c1:.1f} g/MJ with capture, {c0:.1f} without; reduction vs {ref:.0f}: {1-c1/ref:.0%} and {1-c0/ref:.0%}")
# Credits: one per tonne CO2e below the reference; proposed 1.8 multiplier for domestic SAF (October 2026 proposal)
for name, c in (('with capture', c1), ('without capture', c0)):
    base = (ref - c) * Et / 1e6                                                 # credits per year
    saf = (ref - c) * E['SAF'] / 1e6
    mult = base + 0.8 * saf
    print(f"{name}: {base/1e3:.0f} thousand credits, {mult/1e3:.0f} thousand with the multiplier; "
          f"at 120 each {base*120/1e6:.1f} or {mult*120/1e6:.1f} million per year")

products 2.079 PJ/yr (SAF 78%); ethanol in 2.114 PJ/yr
with fermentation CO2 captured and stored (ethanol CI 24):
  ethanol                               24.4 g/MJ
  fired heater (natural gas)             3.4 g/MJ
  electricity (1.6 MW)                   0.2 g/MJ
  hydrogen (640 t, from natural gas)     3.2 g/MJ
  transport, distribution                1.3 g/MJ
CI 32.6 g/MJ with capture, 65.1 without; reduction vs 89: 63% and 27%
with capture: 117 thousand credits, 190 thousand with the multiplier; at 120 each 14.1 or 22.8 million per year
without capture: 50 thousand credits, 80 thousand with the multiplier; at 120 each 6.0 or 9.7 million per year

With capture, the products' carbon intensity is about 33 g CO₂e/MJ, of which 24 comes with the ethanol and 9 from the ATJ step itself: about 3.4 from the heater, 3.2 from the hydrogen, 1.3 from transport and distribution, and very little from Ontario's low-carbon electricity. That is about 63 % below an illustrative fossil jet reference of 89 g/MJ. Without capture, the intensity is about 65 g/MJ, only 27 % below. The fermentation carbon dioxide capture project, which is outside the ATJ plant's battery limits, more than doubles the reduction.

What the carbon intensity is worth

Under the federal Clean Fuel Regulations, a supplier of low-carbon fuel in Canada creates one credit for each tonne of CO₂e by which its fuel's life-cycle emissions fall below the reference for the fuel it displaces. With capture, the plant's products would create about 117,000 credits a year. In October 2026 the federal government proposed amendments that would multiply the credits created by domestically produced fuels, with 1.8 for SAF, the highest of any fuel, and lower factors for others; the code applies the multiplier to the SAF only, giving about 190,000 credits a year. At an illustrative 120 dollars per credit, that is about 14 million dollars a year without the multiplier and 23 million with it. Without capture, the figures fall to 6 and 10 million. The team treats the multiplier as a proposal, not a certainty, and Lesson 12 tests the economics both with and without it. Credit prices under the regulations have varied widely since the market opened, which is the other risk in these numbers.

The credit calculation has a practical side that the team writes into the operating plan. Credits are created only for fuel actually supplied, so the plant must keep records of each batch of SAF, naphtha and diesel shipped, its approved carbon intensity, and its buyer. The carbon intensity itself must be reverified as the plant operates: if the heater burns more gas than designed, or the ethanol plant's capture is out of service for a month, the actual intensity rises and fewer credits are earned. Liam proposes a monthly carbon intensity report built from the plant's metered natural gas, electricity, hydrogen and product flows, so that operations sees the value of a megawatt saved in the same terms as the value of a tonne of product. Wren adds that the capture plant's availability should be reported alongside it, since an outage there costs the ATJ plant more than any fault of its own.

Two lessons for the design come from these numbers. The first is that the ATJ plant's own contribution, about 9 to 10 g/MJ, is worth reducing. Every gram per megajoule is worth about 2,000 credits or the equivalent a year at this scale. Green hydrogen from electrolysis, renewable electricity or electrification of the heater would each remove a few grams, at costs Liam compares in the report. The second is that the capture project is essential: without it the plant's product is low-carbon in name but earns little for it. The team's recommendation will make the ATJ investment conditional on the capture project, or on another way of lowering the ethanol's carbon intensity.

Beyond carbon

Wren asks the team to look beyond carbon intensity. Corn ethanol's environmental profile includes fertilizer runoff and water use on farms, which carbon intensity does not capture. SAF from the ATJ route also brings benefits that carbon intensity does not capture: its near absence of aromatics and sulfur reduces particulate emissions from aircraft engines, including the soot that seeds contrails. The team's report notes both, without quantifying them, as part of an honest account of the product's environmental case.