Sinopec ( SNP , quote ) has developed China's first aviation biofuel, the Civil Aviation Administration of China (CAAC) announced February 28. The fuel is made from renewable resources and produces much less carbon dioxide than traditional aviation kerosene in flight.

The fuel is now under review by the CAAC, which will examine it through laboratory experiments and test flights. If the product is proven safe for aircraft, Sinopec will gain approval from the CAAC to use the product in commercial flights.

China consumes nearly 20 million tons of aviation fuel each year, and Sinopec provides 70% of it. The company is actively seeking new raw materials for aviation biofuel, including waste cooking oil and seaweed.

Aviation biofuels are new even in the West and were first approved for commercial use in July 2011.

The International Air Transport Association (IATA) supports research in alternative fuels and believes a 6% share of sustainable second-generation biofuels is achievable by 2020.

Boeing ( BA , quote ) supports a target of 1% of global aviation fuels to be derived from renewable biomass by 2015.

Sinopec trades robustly in the United States, but investors may also be interested in the Global X China Energy ETF ( CHIE , quote ), which devotes 11% of its holdings to this company's shares.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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