AIRSHOW-Biofuels to the fore in fight to reduce emissions

* Boeing says tests show biofuels can replace fuel

* Official approval for alternative fuel expected 2010

* Commercial projects to grow algae, jatropha to follow

* Weight, drag reduction being worked at in meantime

By John Bowker

PARIS, June 18 (Reuters) - Biofuels could be used to replace jet fuel in less than five years following recent tests by plane-maker Boeing (BA.N), while the industry says it is putting billions of dollars into improving its environmental impact.

Boeing's director for environmental strategy Billy Glover told Reuters that results from recent test flights using biofuels such as jatropha and algae had been "better than expected", meaning a partial replacement for jet fuel could be become a reality in "three to five" years.

"It works -- no problem. We don't have to make any changes to aeroplanes or engines," he said at the Paris Air show.

"We expect to get approval for the fuel from the American Society for Testing and Materials (ASTM) next year," he added.

The industry predicts that if 100 percent of all jet fuel was replaced with biofuels it would cut airline carbon emissions by 80 percent. This is because carbon is taken out of the atmosphere by growing plants before being put back in by planes.

Airlines including Virgin Atlantic [VA.UL>, Continental (CAL.N) and Air New Zealand (AIR.NZ) took part in test flights for Boeing over the past year. [ID:nL5283581]

BIGGEST THREAT

EADS-owned rival Airbus (EAD.PA) is planning its first commercial test flight with biofuels later this year, according to Axel Krein, the company's senior vice president of research & technology. He said Airbus currently spends 2 billion euros ($2.79 billion) a year on research and development -- the bulk of which goes into fuel efficiency.

"I am confident that 100 percent of jet fuel will come from biofuels. The question is, when is that date?" he said, forecasting that 30 percent of fuel could come from plants by 2030.

Boeing and Airbus are also working on reducing carbon emissions via weight and drag reduction on new aircraft.

The importance of cutting emissions for the industry was spelled out by Airbus CEO Tom Enders earlier in the airshow.

"Concerns about the environment and what aviation does to the environment I believe are long-term. if we do not tackle them, they are one of the biggest threats to the aviation industry," he told reporters.

"Of course, given the fact that fuel is up to 40 pct of airline costs, we would be crazy if we hadn't tackled it. efficiency, cost reduction and environment benefit fall together," he added.

Boeing's Billy Glover said the next stage after approval for biofuels would be to set up commercial projects for mass production of plants.

Jatropha, a poisonous plant that produces seeds that can be refined into biofuels, and algae are seen as the most able to be produced commercially, as they do not grow on land currently used for farming foodstuffs.

"The biggest hurdle is supply of plants and getting up to scale. That's the biggest cost -- how to actually get people to produce it on a regular basis," he said. (Reporting by Maria Sheahan and Andrea Shalal-Esa; Editing by Rupert Winchester)