A big climate problem with few easy solutions: Planes

By Niraj Chokshi and Clifford Krauss

The worst of the pandemic may be over for airlines, but the industry faces another looming crisis: an accounting over its contribution to climate change.

The industry is under increasing pressure to do something to reduce and eventually eliminate emissions from travel, but it won’t be easy. Some solutions, like hydrogen fuel cells, are promising, but it’s unclear when they will be available, if ever. That leaves companies with few options: They can make tweaks to squeeze out efficiencies, wait for technology to improve or invest today to help make viable options for the future.

“It’s a big crisis, it’s a pressing crisis — a lot needs to be done soon,” said Jagoda Egeland, an aviation policy expert at the International Transport Forum, a unit of the Organization for Economic Cooperation and Development. “It’s a hard-to-abate sector. It will always emit some carbon.”

Experts say commercial air travel accounts for about 3% to 4% of total U.S. greenhouse gas emissions. And while planes become more efficient with each new model, growing demand for flights is outpacing those advancements. The United Nations expects airplane emissions of carbon dioxide, a major greenhouse gas, to triple by 2050. Researchers at the International Council on Clean Transportation say emissions may grow even faster.

The urgency isn’t lost on the industry. Scott Kirby, CEO of United Airlines, speaks often about the need to address climate change, but even he acknowledges that it will be difficult for the industry to clean up its act. He wants United and other airlines to try different things and see what works.

“It is the biggest long-term issue that our generation faces. It is the biggest risk to the globe,” Kirby said in a recent interview. “There are plenty of things we can compete on, but we all ought to be trying to make a difference on climate change.”

‘It’s going to be a real stretch.’

At a petrochemical plant outside Houston, Neste U.S. and Texmark Chemicals are converting imported undistilled diesel into renewable jet fuels. The undistilled diesel is made from used cooking oil and waste from vegetable and animal processing plants.

Neste, a Finnish company, is the world’s largest producer of renewable jet fuel. Its U.S. customers include American Airlines, JetBlue and Delta Air Lines.

United, which buys renewable jet fuel from Fulcrum BioEnergy and World Energy, recently announced a deal with more than a dozen major corporate customers, including Deloitte, HP and Nike, that will result in the airline’s buying about 3.4 million gallons of sustainable fuel this year. American has an agreement to buy 9 million gallons of such fuel over several years, and Delta says it plans to replace one-tenth of its jet fuel with sustainable alternatives by 2030.

“There is huge growth potential for sustainable aviation fuel,” said Jeremy Baines, president of Neste U.S. “It’s a niche market today, but it’s growing very rapidly. Between today and 2023 we are going to increase our production at least 15-fold.”

Neste produces 35 million gallons of renewable aviation fuel and hopes to reach 515 million gallons annually by the end of 2023 by ramping up production at refineries in Singapore and Rotterdam, the Netherlands. That is enough to fuel close to 40,000 flights by wide-body aircraft between New York and London, or well over a year’s worth of pre-pandemic air travel between the two cities.

But it is important to put those numbers in perspective. U.S. airlines used more than 18 billion gallons of fuel in 2019, and the country as a whole consumes more than 100 billion gallons of petroleum products annually.

Rystad Energy, a Norwegian consulting firm, predicts that renewable fuels will become increasingly economical after 2030 and supply 30% of all aviation fuel by 2050. But IHS Markit, a U.S. consulting firm, estimates that sustainable jet fuel will make up only 15% of all jet fuel by 2050.

Renewable jet fuel has its limits, too. The fuel reduces carbon emissions by only 30% to 50% compared with conventional jet fuel, according to Daniel Evans, global head of refining and marketing at IHS Markit. What’s more, production of the fuel can cause deforestation when the raw materials are farmed.

Some companies want to get around those problems by avoiding agricultural crops. Fulcrum, in which United is invested, is planning to build a plant in Britain to produce jet fuel out of waste from landfills and other trash. Red Rock Biofuels, a Colorado company, hopes to use waste woody biomass.

But development of renewable fuels from waste or substances like fast-growing algae and switch grass has been frustratingly slow.

“It’s going to be a real stretch,” Evans said. “Even if you are burning 100% biofuel, it’s still not going to be getting you to carbon neutral.”

Biofuels are also about 50% more expensive to make than conventional fuel, according to Michael E. Webber, chief science and technology officer of Engie, a French utility working on advanced jet fuels.

In the United States, federal support is minimal, so far. Renewable jet fuel producers receive a $1 per gallon subsidy under existing federal tax credits for biodiesel, but a bill introduced this month in the House would provide a tax credit starting at $1.50 per gallon. A tax on carbon emissions could help make alternative fuels more competitive against conventional jet fuel in the future.

Should airlines offset or store carbon?

Another option that many airlines have turned to is carbon offsets. By buying an offset, a company or individual effectively pays somebody else to plant or not cut trees or to take other steps to reduce greenhouse gases.

But the benefits of some offsets are difficult to measure — it’s hard to know, for example, whether landowners would have cut down trees had they not been paid to preserve woods, a common type of offset. Kirby, the United CEO, is skeptical that such offsets are effective.

“Traditional carbon offsets are a marketing initiative; they’re greenwashing,” he said. “Even in the few cases where they are real and are making a difference, they’re just so small that they can’t scale to solve the global problem.”

United helps passengers and corporate customers buy offsets, but Kirby said the company was focusing more on sustainable fuel and removing and storing carbon in perpetuity.

In December, the airline said it was investing in 1PointFive, a joint venture between Occidental Petroleum and a private equity firm that plans to build plants that suck carbon dioxide from the air and store the gas deep underground. This approach would theoretically allow United and other airlines to remove as much carbon from the atmosphere as their planes put into it.

“It’s the only solution I know of that can help get us as a globe to zero, because the others, if you understand the math, they just don’t work,” Kirby said.

Despite the formidable challenges, Kirby is optimistic that investments in alternative fuels and carbon capture technology will yield a breakthrough.

“In the near term, it’s about getting them to work economically,” he said. “Once you cross that threshold, you will have an exponential increase.”