Jet fuel can be produced only in the purification process of crude oil at a constant rate, though it will be in greater demand with the spread of jet travel. Its price has been increasing since 2000 at 12% annually on average to about 100 yen per liter today. Because the number of aircraft will supposedly double to 35,000 planes in 20 years, it is urgent to develop a technology to produce less expensive of jet fuel. Currently, it is allowed to add biofuel to jet fuel up to 50%. Corns and sugarcanes are used to produce biofuel, but they are subject market fluctuations.
Algae are supposed to be hard to culture in large amounts. However, IHI developed a technology to mass produce alga-based biofuel for up to 50% of the volume of algae by utilizing its plant technology. The company has already succeeded in reducing the production cost of algae-based biofuel to 500 yen per liter, half of the cost to produce standard biofuel made of plant seeds. In order to reduce the production cost to 100 yen per liter, the company plans to build a plant in Southeast Asia or Australia to make the best use of long hours of sunlight vital to the photosynthesis of algae. Because fuel cost accounts for 40% of the operation cost of airlines, lower jet fuel helps them to improve profits. U.S. ventures take the lead in research and development of biofuel, but none of them established the technology for the mass production of biofuel.