Drax Group and Pathway Energy are joining forces to propel aviation’s net-zero ambitions through an ambitious deal that could see over a million tonnes of sustainable biomass fuel supply powering next-generation carbon-negative jet fuel. This multi-billion-dollar partnership is set to redefine the aviation fuel landscape while driving decarbonisation innovation.
Drax Group, a UK-based renewable energy leader, and Pathway Energy LLC, a US carbon-negative energy innovator, have signed heads of terms on a multi-year supply agreement. The deal outlines plans for Drax to deliver over one million tonnes of sustainably sourced biomass pellets annually to Pathway’s upcoming $2 billion sustainable aviation fuel (SAF) facility on the U.S. Gulf Coast. The plant is expected to produce 30 million gallons of carbon-negative SAF each year—enough to power 5,000 long-haul carbon-neutral flights.
Alongside the supply deal, Drax could also become a strategic partner in the project, with a potential investment of up to $10 million via a convertible loan note. While no investment decision has been made, the agreement underlines the company’s commitment to decarbonisation, with SAF forecasted to account for 65% of aviation sector emissions reductions by 2050, according to the International Air Transport Association.
Pathway aims to begin construction on the facility in 2026 and commence SAF production by 2029. Additionally, the site will integrate bioenergy with carbon capture and storage (BECCS), a cutting-edge technology that not only removes carbon emissions but also generates renewable power. The planned BECCS system could extract 1.9 million tonnes of carbon dioxide from the atmosphere each year while powering SAF production, ensuring a net carbon-negative fuel.
This deal is potentially the largest third-party supply agreement for Drax’s pellet division, with plans to scale further. Beyond the current Gulf Coast plant, Drax could supply an additional 2 million tonnes of biomass annually to Pathway’s future projects through the 2030s. Drax CEO Will Gardiner hailed the agreement as a critical milestone in the global energy transition and aviation decarbonisation, reinforcing Drax’s commitment to fighting climate change.
Steve Roberts, CEO of Pathway Energy, echoed this sentiment, emphasising how this strategic collaboration combines sustainable biomass technology, global-scale feedstock supply, and carbon capture innovation to decarbonise one of the world’s most challenging sectors.
Drax Group plc (LON:DRX), trading as Drax, is a power generation business. The principal downstream enterprises are based in the UK and include Drax Power Limited, which runs the biomass fuelled Drax power station, near Selby in North Yorkshire.
