As a major airline, we have made a commitment to take actions today that shape an environmentally sustainable future. A key component of that promise is to advance the use of environmentally responsible and cost-efficient alternative aviation fuels. We’re proud to be recognized as a U.S. industry leader in this area.
Alternative fuels are important for the aviation industry because they can help reduce our impact on the environment, diversify our fuel supply and promote the development of U.S. grown and produced biofuels. Since 2006, the aviation industry has focused on biofuels as a way of reducing our carbon emissions. More than 1,500 flights have been completed on biofuels over the last few years. However, bringing alternative fuels into commercial use has been challenging for a number of reasons, including the difficulty of achieving commercial-scale production at prices that airlines can afford.
Through the International Air Transport Association, the aviation industry has agreed to achieving carbon neutral growth from 2020. To meet this objective, the industry is exploring the use of alternative fuels, in addition to making investments in new aircraft, modifying existing aircraft and procedures, and improving infrastructure.
A history of firsts
We’re doing our part to advance alternative fuels for use in our aircraft and we continue to work with alternative fuel producers, the airline industry, the U.S. government and the U.S. military to help advance the viability of these fuels for commercial use.
In 2009, we became the first North American carrier to perform a two-engine aircraft flight demonstration using sustainable biofuels, and the first to use algae as a fuel source for commercial carriers. We performed this flight in partnership with Boeing, GE Aviation’s CFM International and Honeywell’s UOP. The flight proved that a biofuel blend could perform comparably to traditional jet fuel and reduce emissions in one of our aircraft.
We also demonstrated a reduction in emission in 2010, when we operated the first commercial synthetic fuel flight using natural gas, maintaining levels of operational and safety performance that are comparable to conventional fuel.
In November 2011 we operated the first U.S. commercial flight powered by advanced biofuels. The Boeing 737-800 aircraft flew from our Houston (IAH) hub to our Chicago (ORD) hub using a blend of algae-derived biofuel and traditional petroleum jet fuel to power the aircraft.
In addition, we’re a signatory to the Sustainable Aviation Fuel Users Group, whose members represent approximately 32 percent of the demand for commercial aviation fuel. We signed a pledge to pursue the advancement of drop-in biofuels that achieve important sustainability criteria, work with leading organizations to achieve biofuel certification standards and take actions to enable commercial use of aviation biofuels.
Here, we delve into two of our most recent “firsts” in biofuels.
AltAir Fuels agreement
In what was a historic milestone for aviation, we recently executed a definitive purchase agreement with AltAir Fuels for cost-competitive, sustainable, advanced biofuels on a commercial scale. With this strategic partnership, AltAir Fuels will use process technology developed by Honeywell's UOP to retrofit part of an existing petroleum refinery and create a biofuel refinery that converts non-edible natural oils and agricultural wastes into approximately 30 million gallons of low-carbon, advanced biofuels and chemicals each year.
Located near our Los Angeles (LAX) hub, the facility will be the first refinery capable of in-line production of both renewable jet and diesel fuels, for use in sustainably powering our LAX flights.
"United Airlines has been a strategic partner for several years as we work to establish our biofuel facility," said Tom Todaro, AltAir's Chief Executive Officer. "We cannot overestimate how important this milestone is for the commercialization of sustainable aviation biofuels, and we at AltAir are proud that United is our first customer."
"This agreement underscores United's efforts to be a leader in alternative fuels as well as our efforts to lead commercial aviation as an environmentally responsible company," said Jimmy Samartzis, our Managing Director for Global Environmental Affairs and Sustainability. "We're excited about what this strategic partnership with AltAir means for United, the industry, the environment and our customers."
We have agreed to buy 15 million gallons of lower-carbon, renewable jet fuel from AltAir over a three-year period, with the option to purchase more. We're purchasing the advanced biofuel at a price that’s competitive with traditional, petroleum-based jet fuel. AltAir expects to begin delivery of five million gallons of renewable jet fuel per year to us starting in 2014.
AltAir Fuel's advanced biofuel is fully compatible with factory-standard engines or aircraft while providing the same performance as conventional, petroleum-based jet fuel. This renewable jet fuel is expected to achieve at least a 50 percent reduction in greenhouse gas emissions on a lifecycle basis.
"This refinery is important for two timely and significant reasons," said AltAir's President and COO Bryan Sherbacow. "First, the industry is delivering on the promise of commercial production of advanced biofuels that move beyond additives, like ethanol and biodiesel, to drop-in, replacement low-carbon fuels. Second, this project demonstrates the practical efficiencies these fuels allow by fully integrating into an operating petroleum refinery."
We'll continue to support AltAir Fuels' efforts to incorporate internationally recognized sustainability standards, such as those being developed by the Roundtable on Sustainable Biomaterials (RSB) – an international, multi-stakeholder initiative that brings together farmers, companies, non-governmental organizations, experts, governments and inter-governmental agencies concerned with ensuring the sustainability of biomass production and processing.
MASBI, a biofuels initiative
In 2012, United, along with Boeing, Honeywell’s UOP, the Chicago Department of Aviation and the Clean Energy Trust, launched the Midwest Aviation Sustainable Biofuels Initiative (MASBI). The coalition is made up of more than 40 public and private organizations (including federal agencies, academic institutions, biofuel producers and feedstock growers), and an Advisory Council chaired by Argonne National Laboratory. Oliver Wyman, a global leader in management consulting with recognized expertise in energy and aviation, provided strategy and program management support to MASBI. Last month, the group released its year-long report, which includes a set of findings and recommendations for how to commercialize aviation biofuels in the Midwestern U.S.
In addition to endorsing the report’s recommendations, several individual MASBI members made new commitments to help secure a robust future for biofuels. Noting the progress made in developing biofuels, the coalition agreed that more must be done to achieve the sustainable production of commercial-scale and cost-competitive advanced biofuels from sources such as non-food crops and waste products.
MASBI issued its report at a summit attended by aviation and energy experts, biofuel developers, environmental organizations, government officials and research institutions. (To download the full report and executive summary, visit www.masbi.org.) The recommendations included the following: streamline the approval process for new biofuel production methods; level the policy playing field for advanced biofuels with the conventional petroleum industry; tailor agriculture products such as oil-seed crops for jet-fuel production; improve biofuel production through agricultural innovation; and pursue deal structures that balance risk and reward for early adopters of technology.
Expanding the availability of sustainable aviation biofuels will have clear business benefits for the airline industry and the broader Midwest economy. From 1990 to 2012, fuel costs increased by 574 percent and are now the single largest expense for commercial aviation, accounting for up to 40 percent of an airline’s operating budget.
Commercial aviation spends $6.3 billion per year on jet fuel for flights originating in the Midwest. MASBI estimates that replacing 5 percent of petroleum jet fuel in the Midwest with aviation biofuel would create more than 3,600 jobs and reduce carbon-dioxide emissions by 700,000 tons.
“We’ve been developing a new industry – one that has the ability to reduce carbon emissions, create green jobs, drive innovation in clean technology and bolster the successful future of the airline industry which is vital to communities all around the world,” said Samartzis. “We need to focus on this today, so that we can have these options tomorrow as we build a more sustainable future.”
In addition to supporting the recommendations in the report, several MASBI stakeholders announced commitments in support of aviation biofuel development:
- Together with the Chicago Department of Aviation, we signed a Memorandum of Understanding to initiate a cooperative effort towards identifying opportunities to develop advanced alternative fuels for aviation use with a particular focus on converting waste streams in the Chicago area into lower-carbon aviation fuel.
- Along with Honeywell’s UOP and Boeing, we agreed to provide funding for Purdue University to research ways to convert corn stover – leaves and stalks left in fields after the corn harvest – into jet fuel. The companies’ funding supports existing research and development funding from the Indiana Corn Marketing Council and Iowa Corn Growers Association.
- We’ll issue a Request for Proposal for the development and purchase of cost-competitive, sustainable, renewable jet fuel and renewable diesel to supply one of our hub locations. Using guidelines and technical requirements presented by MASBI Advisory Council member Commercial Aviation Alternative Fuels Initiative (CAAFI), the intent is to emphasize market demand, spur innovative approaches to partnership across the value chain, and obtain delivery of renewable fuel to be used in daily operations.
- In partnership with Boeing and Honeywell’s UOP, we’ll fund the development of a prize at the Clean Energy Trust’s Clean Energy Challenge. The prize will be directed towards advanced biofuels projects in the Midwest. The Clean Energy Challenge has been a catalyst in jump-starting innovation within the Midwest by allowing clean energy entrepreneurs at varying stages of development to compete for funding and to receive other resources for growth, improving their chances of success.
We’re committed to leading the industry in the development and advancement of a commercial market for alternative fuels for aviation. We’re taking actions every day to make that commitment a reality, from being the first in the U.S. to fly a commercial jet on biofuels to being the first U.S. carrier to purchase commercial-scale, cost-competitive biofuels.