From: News.com.au - 03/08/2008.
With oil prices soaring, the company is testing the power of the jatropha curcus, a nut which grows in tropical, semi-arid regions.
The world-first trial flying a Boeing 747-400 partly on nut juice is part of the airline's ambitious plan to have 10 per cent of its fleet operating on hybrid fuels within five years.
Other airlines are looking at biofuels, both to cut oil costs and to reduce their emissions as carbon trading schemes come into force.
Virgin Atlanic, as well as Air New Zealand, are also looking at using algae as a fuel source, while Qantas said biofuel development was being fast-tracked.
However, Qantas chief risk officer Rob Kella said Qantas had no immediate plans for a test flight.
"Many airlines including Qantas are actively evaluating the feasibility of cleaner jet fuels," he said.
"Availability on a global scale is still five to 10 years away but the current fuel crisis combined with an increasing focus on environmental concerns have accelerated the development path.
"Biofuels may deliver significant environmental and economic benefits including lower carbon emissions.
"Under the Federal Government's carbon pollution reduction system, as with the EU and New Zealand schemes, consumption of biofuels is 'zero-rated' - that means biofuels do not attract any charge.
"The Government is also proposing to provide funding under the Climate Change Action Fund for research and rapid commercialisation of low emission fuel sources. This increases the incentive for our industry to develop 'drop-in' biofuels as quickly as possible."
Air New Zealand airline operations general manager Captain David Morgan gave details of the test flight program during a speech in Adelaide this week.
"We plan to test fly a 747 this year using the nut to power one engine," he told the Australian New Zealand Business Council (SA) lunch.
The three-hour flight from Auckland airport will be the world's first flight test using jatropha fuel on a large passenger aircraft.
If it is successful, Air New Zealand expects to use a million barrels a year of the nut fuel annually by 2013.
The nut, originally from the Caribbean, would grow well in Australia, with a plantation of about 125,000ha needed to produce a million barrels.
"We would not do it if it meant replacing food crops or forests for fuel nut plantations - it has to be socially acceptable," Captain Morgan said.
"If it does work as hoped it would be a great alternative - it releases less CO2 when used, and it takes in CO2 when it is growing."
Air New Zealand chief executive Rob Fyfe said Air New Zealand was committed to being at the forefront of testing environmentally sustainable fuels.
"We are confident our hard work with partners like Boeing together with efforts of many of our peers will see a step change sooner than many people realise," Mr Fyfe said.
"This fundamental shift in fuel options should be embraced by the industry and we aim to see at least 10 per cent of our total annual needs coming from environmentally sustainable fuels by 2013."
Soaring fuel prices have increased Air New Zealand's fuel bill by $US783 million since last July. Each $US1 increase in the price of a barrel of fuel costs the airline $US10 million off its bottom line.
Air New Zealand is looking at a range of options to cut fuel costs.
"It costs us $225,000 in fuel to fly a 747 from Los Angeles to Auckland but only $165,000 to fly a 777 on the same route," Captain Morgan said.
He said airlines were even debating the merits of plastic versus metal cutlery - Air New Zealand carries more than five tonnes of catering equipment on a 747, and each kilogram costs $450 in fuel a year.