The last several months have seen a flurry of activity in the aviation sector, as fuel price volatility and impending greenhouse gas regulations have goaded major airlines to ink deals for renewable jet fuel.

The latest involves British Airways, which struck a deal with Solena Group for 16 million gallons of jet fuel from waste.

The moves highlight the tremendous pressure airlines are under to keep costs low in an increasingly oil constrained world and regulated marketplace. During the last oil spike, fuel expenses, which historically ranged from 10 to 15 percent of US passenger airline operating costs, averaged more than 35 percent in the third quarter of 2008. According to news coming out of the International Air Transport Association, the marketplace for cheap fuel is about to get much more crowded.

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Biofuels – made from algae and non-food plants – are emerging as a potentially viable alternative to conventional jet fuels. Although big challenges remain, the reductions in greenhouse gas emissions could be major.

Earlier this year, a Continental jet accelerated down the runway at George Bush Intercontinental Airport in Houston. Nothing out of the ordinary for Capt. Rich Jankowski, who countless times in his 38-year career had eased such two-engine Boeing 737-800s into the sky. Except on this experimental flight, one of the engines Jankowski relied on was burning fuel derived from microscopic algae to push the 45-ton aircraft into the air and keep it aloft — a first in aviation history.

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