Honeywell, MIT project AI could cut fuel production costs by billions

Honeywell (NASDAQ: HON) and the MIT Center for Sustainability Science and Strategy released a joint report on June 24 projecting that AI-enabled technologies could reduce global oil-based fuel production costs by up to $55 billion annually within five years of application, and up to $225 billion by 2050.

For liquefied natural gas, the report titled Accelerating Energy Expansion projects annual cost reductions of $15 billion within five years of AI adoption, rising to $80 billion by 2050. Applied globally, long-term LNG prices could fall by 4.5%, according to the research.

The report covers three focus areas: increasing energy supply, managing demand more efficiently, and diversifying energy resources. It also identifies on-site power generation and energy storage as near-term options for heavy energy users seeking to add capacity without waiting for new grid infrastructure.

The research notes that conventional gas-turbine solutions face permitting and equipment delays, making fuel-cell-based systems more attractive for faster deployment. Intelligent battery storage is also cited as a tool for managing peak demand and reducing the need for additional grid investment.

A third area of the report addresses alternative fuels, including sustainable aviation fuel, and the role of regional feedstocks such as biomass, waste oils, and non-edible crops in building energy security.

"The MIT analysis highlights the significant cost-reduction opportunities AI-enabled technologies can unlock in fuel production, which is top of mind for consumers and policymakers alike," said Ken West, President and CEO of Honeywell Process Technology.

The report was released at Honeywell's 2026 Future of Energy Summit, an annual gathering of industry leaders, policymakers, and technology experts.

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