FUEL FOR THOUGHT
Between 1937 and 1939, two prominent scientists, Sir Frank Whittle, and German scientist Hans von Ohain, were both crafting designs on the world’s first turbojet engines. Both designs were tested successfully in April of 1937, but Ohain’s was the first engine successfully flown in an aircraft in August 1939. Because of its known compression and performance properties and its ease of evaporation, gasoline was the fuel originally used to power Ohain’s engine. However, Whittle’s design used an illuminating kerosene fuel because gasoline was in very short supply due to World War II. His choice to use kerosene led Whittle’s engine to become the forerunner of successful jet engines in the U.S. and Britain, and to this day, kerosene remains the fuel type used to power these engines.
Early advocates of the jet engine claimed that these new engines could operate on any fuel from whiskey to peanut butter. While it’s true that jet engines are much more tolerant than gasoline and diesel engines, the aircraft and engine fuel systems are still sensitive to the chemical and physical properties of the fuel. Early advances in engine and aircraft design greatly expanded the flight envelope (aircraft speed, altitude, maneuverability), which necessitated new production standards for turbine engine fuel quality. This led to the introduction of a variety of fuel types for different purposes and to the development of control specifications to ensure the fuel met equipment requirements under all flight conditions.
In 1944, regulatory specifications were first published for the kerosene jet fuel known as JP-1, which mandated a freezing point of -60C (-76F) – however, this limited the availability of fuel so much that it was quickly superseded by other more widely available fuels, which were mixtures of naptha and kersosene.
The first British jet engine fuel specification was introduced by the end of World War II and covered what was virtually an illuminating kerosene. This specification became obsolete in 1965 when it was replaced by the predecessor to current U.S. commercial jet fuel specifications. Even though the first U.S. jet engines were identical to early British designs, these newly developed jet fuel specifications differed significantly in volatility, freezing point, specific gravity, sulphur and aromatic limits. The U.S. specification was derived from the aviation gasoline specification (a lead-based fuel), while the British specification reflected the properties of illuminating kerosene.
Over time, different fuel variations were developed to lower freezing points and increase flash points, and eventually, the fuel type used in most U.S. civilian jet aircraft was created, known as Jet-A. To meet standards, this fuel must maintain a low viscosity at low temperature, meet definite limits in terms of density and calorific value, burn cleanly, and remain chemically stable when heated to high temperature. Jet-A has a freezing point of -40C (-40F) and a flash point of 38C (100F) and weighs approximately 6.7 pounds per gallon.
As the largest continuous expense in aircraft operations, managing fuel cost is critical for aircraft owners and operators. Following the economic downturn in 2008, flight departments became very cost-conscious and began looking for better ways to reduce expenses. As the economy slowly recovered, business aviation flight activity also began increasing, and has been climbing steadily since 2010. This was somewhat attributed to the lower cost of jet fuel.
In 2016, wholesale price from U.S. refineries reached its lowest mark since 2004. U.S. refining capacity has also increased substantially, currently producing almost two million gallons per day more than in 2000. However, uncertainty in the stability of low fuel costs is still a concern to aircraft owners and operators. Various factors such as disorder in the Middle East, the U.S. political climate, and the potential that a hurricane could disrupt U.S. production play into the concern that fuel prices will increase.
The price of jet fuel is determined by several layers in the process, from refining to pumping into the aircraft. The fuel supply price, typically set by market conditions, is the basis for total fuel price. Adding to the cost is delivery to the holding tanks via pipeline, barge or truck. From there, the FBO will transfer the fuel into their own refueling equipment, and the cost of that equipment, personnel, training and safety mandates also add to the price. The FBO will then pump the fuel into the aircraft (known as into-plane) and will increase price to cover their costs, plus make a profit on the sale of the fuel. After adding the various taxes, a final price will be established, known as the “retail price.”
Typically, the only negotiable factor in the retail price of fuel is with the FBOs into-plane markup. Most FBOs offer some form of a discount, decided by purchase volume, or if the aircraft is home-based. However, at some locations the fuel provider might inflate the into-plane price in expectation of the operator negotiating with them. At other airports, where the airport authority is in charge of fueling operations, the price is typically not negotiable.
Operators like Jet Linx take advantage of an industry innovation which leverages the buying power of millions of gallons of fuel, known as contract fuel. With contract fuel, Jet Linx obtains the least expensive fuel price from different supplier-branded facilities and fuel providers. Prices are driven much lower, while eliminating the need to have various credit lines directly with oil companies. In addition, some contract fuel providers assist in eliminating excise taxes and value added taxes. Contract fuel also allows ease of purchase at worldwide locations, where the vendor has established a rate and credit with international facilities. This allows ease not only in purchasing fuel, but also helps with tax calculations, currency conversion, and payment across the globe.
Jet Linx currently partners with approximately 14 different contract fuel companies to leverage their buying power to obtain the lowest price possible at an FBO. The Jet Linx Flight Coordination team compares these vendors’ prices to the FBOs published retail price on a daily basis, and selects the least expensive option. Once the aircraft is fueled, the team verifies that the FBO properly charged the correct contract fuel company, and once that vendor’s invoice is received by Jet Linx, it is audited for accuracy.
Using a combination of national network volume discounts, along with the buying power of its various contract fuel vendors, Jet Linx is able to reduce aircraft operating costs substantially for its owners.