RFF is releasing a new episode in its Policy Leadership Series Podcast, which highlights conversations with leading decisionmakers on environmental and energy issues at RFF’s flagship Policy Leadership Series events. This week, RFF President and CEO Richard G. Newell and United Airlines CEO Scott Kirby discuss United’s net-zero commitments, the risks of relying on carbon offsets to reduce emissions, and the importance of sustainable aviation fuels for the future of air travel.
Visit the event webpage to watch a video recording of this conversation.
Listen to the Podcast
- Scott Kirby: “[Climate change] is the biggest issue facing our generation. Even today, while there’s a lot of talk about it, there are very few people that really understand some of the tipping points and the potentially catastrophic and massive changes that can happen to the globe … Many of those are tipping points that, once you hit them, would take tens of thousands of years before they could be reversed.” (6:40)
- Richard G. Newell: “Energy production and use is currently about 80 percent of all US greenhouse gases and 97 percent of carbon dioxide emissions. Advanced energy technologies do have a central role in decarbonization strategies. At RFF, we have an Advanced Energy Technologies Project, which is quantifying the potential societal benefits of advances in technologies like geothermal power, carbon capture from gas power plants, advanced nuclear reactors, energy storage, and direct air capture.” (8:16)
- Scott Kirby: “People 20 years ago said wind and solar could never compete with carbon for powering the grid, and today, it’s cheaper to produce a megawatt with renewable energy than it is with carbon in many places in the country. The same can happen with sustainable fuels.” (11:30)
- Scott Kirby: “I’m going to be an optimist. We have to solve this problem, so it is going to get solved. It’s either going to get solved voluntarily, or solutions are going to be imposed on us … Even here in the United States, there’s been a change in even the last six months of airline CEOs, either trying to do the right thing or—because they view it as inevitable—starting to ask questions and get educated. I think we’re on a really good path.” (30:05)
- Scott Kirby: “It’s important that we solve this in a bipartisan way, because that gives permanency to it. It doesn’t have to be all the Republicans, but if we can get to a bipartisan solution on climate change, companies will have the confidence to invest for the long term … These are 30-year decisions, and no one is going to make a 30-year decision that they think might change in a year and a half.” (31:17)
The Full Transcript
Elizabeth Wason: Welcome to the Policy Leadership Series Podcast from Resources for the Future. In every episode, leading global decisionmakers speak to RFF President and CEO Richard Newell about big environmental and energy policy issues.
In this episode, Richard speaks to United Airlines CEO Scott Kirby. Their conversation took place on May 11.
Richard G. Newell: Welcome, Scott. Thanks so much for joining us today.
Scott Kirby: Thanks for having me, Richard, looking forward to it.
Richard G. Newell: Scott, I'd like to begin with your career and experiences in the aviation industry. You started your career at the Pentagon after receiving a bachelor's degree from the US Air Force Academy and a master's from George Washington University.
Since then, you've held leadership roles at multiple major airline companies. How have those experiences ultimately led to where you're at now, and how does that background help guide your strategic decisions at United?
Scott Kirby: Well, I think my military background was certainly important in my own formation and development of leadership skills. It was a great place to learn. Working at the Pentagon was a hugely formative experience for me. I was fortunate to work in the office of Dr. Chu, one of the undersecretaries of defense, and to work with some brilliant people. I was 21 years old and got to see all this really important stuff happening. I was sitting in the back of the room, but I got to hear the Secretary of Defense, the Secretary of the Air Force, and others talking about the issues of the day.
Then when I left, I wanted to do something with math. My graduate degree is in operations research, so I wound up by happenstance in the aviation industry and fell in love with it. It's a great industry. It hasn't been a great industry for investors, as Warren Buffet will tell you, but it's a great industry that makes a difference.
Maybe we'll talk about that today, but our humanitarian response in the last year and what we're doing right now in India is one of those things that goes beyond just being a corporation that you can be proud of. It has employee issues. It's at the center of everything that happens and is high-profile. It also gives you a platform, which I'm sure we'll talk about today, to make a difference on bigger issues in the world, like sustainability or diversity, that go far beyond what you do as a corporation.
It's been wonderful. I've thoroughly enjoyed it. I've never felt like I had a job. I've had something that I was passionate about the whole time that I've been working since I got out of the Air Force Academy, and I've been fortunate in that regard.
Richard G. Newell: You've been at United since 2016. You've been CEO for about a year now, and what a year it's been. You'd stepped into the role of CEO just before the pandemic brought the global airline industry, really, to almost a grinding halt. There has been a massive shift in airline traffic, fleet operations, and employment, institutional priorities.
Tell us a bit about how the pandemic has affected your priorities as CEO and what steps you're taking to build an economically sustainable future for the company and its operations.
Scott Kirby: Yeah. This has been, obviously, the most transformative year in our history. And, my, what a difference a year makes! We were wondering if the world was ever going to be able to open back up or how long it would take, and there was incredible uncertainty about vaccines and how long would they take or would they even work.
For the first couple of months after this started, our revenues were down 99 percent, but the good news of that is, certainly at United, we used it to accelerate a decade's worth of change into a single year. Not only have we accomplished a decade's worth of change in a single year, but we've been able to create buy-in from people. There's all kinds of things that I could talk about—about the culture, technology, cost issues, and things like that.
But I think the most important from anyone listening today is the cultural change that really has changed how our frontline employees and all of us think and talk about the customer. For far too long at every airline I've been at—and I was part of the leadership team so you can blame me—they spent way too much time talking about the product on the airplane: things like the physical airplane, how to get the plane off the gate on time, operational metrics, and a lot of internally focused stuff.
At United now, we spend tons of time talking about and taking steps not just to empower our frontline employees, but also to eliminate barriers and obstacles through things like eliminating change fees. As a perfect example, we've got this program called ConnectionSaver, which now gives employees the opportunity to hold an airplane when they need to wait and think the right thing to do is to wait for a connecting customer instead of slamming that door in their face.
Those kinds of policy changes are convincing our frontline employees that when we say we want to do the right thing for the customer, we really mean it. For far too long, we had policies that kept them from doing it, and so I think this changes how our customers are going to feel when they fly United. We use that term a lot, like how do people feel when they fly United?
We're already seeing in our data and seeing it anecdotally. Every time I fly, customers tell me it's different, and they can tell. Keeping that progress toward putting the customer front and center and really focusing on how we make people feel when they fly will probably be the biggest structural change, amongst a lot of others. But I think that’s the biggest turning point in the history of United.
Richard G. Newell: Mm-hmm (affirmative). I want to talk about another turning point and delve a little bit into United's institutional strategy for your ambitious goal to reach net-zero emissions by mid century.
The announcement has garnered a lot of attention. The airline industry is responsible for about 2 percent of the world's carbon emissions, and United is the first major airline to take such a commitment and really pave the way, potentially, for the industry as a whole to reduce its carbon footprint.
Specifically, you've committed to reducing United's carbon emissions by 100 percent by 2050. That's building, as I understand it, on a commitment made in 2018 to reduce emissions by 50 percent by 2050. So, it really goes well beyond that, and 50 percent by 2050 was already an ambitious goal. Can you speak a bit about how you reached the decision to set this even more ambitious goal?
Scott Kirby: Yeah. First I'd say, this is an issue that I am personally passionate about, have followed intently. I'm kind of—I am—a geek; I'm not kind of a geek. I am a science geek and have been following this since college, paying attention to it. It's been obvious for a long time that it was likely this was happening and then obvious for at least 25 years that it was happening.
It is the biggest issue facing our generation. Even today, while there's a lot of talk about it, there are very few people that really understand some of the tipping points and the potentially catastrophic and massive changes that can happen to the globe and to civilizations around the world from the increase in carbon and from climate change.
Many of those are tipping points that, once you hit them, would take tens of thousands of years before they could be reversed. It really is the defining issue for our generation, so this was always a passion of mine. At United, we just we've made the commitment, and we figured out how we can get to not only 100 percent net zero. We called it something different than everyone else, a 100 percent green, meaning we will get there without using the traditional carbon offsets that almost every company uses today.
I think without question, we're the leader in global aviation, but the reality is United is a leading global company because of that commitment. I'm sure we'll talk about this more today, but carbon offsets cannot be the answer, and I'll wait to give you my passionate speech about why.
Carbon offsets can not be the solution, and if companies keep relying on carbon offsets, we will never solve this problem. We've committed to doing it. Despite being in a hard to decarbonize industry, United has committed to getting to a 100 percent green without using the traditional carbon offsets. That's probably the biggest thing that sets us apart from what anyone else in the world is doing.
Richard G. Newell: We'll unpack this a bit, because as I understand, there's a number of different elements to your strategy and that’s really important because energy production and use is currently about 80 percent of all US greenhouse gases and 97 percent of carbon dioxide emissions. Advanced energy technologies, like the ones I'm sure we'll talk about, do have a central role in decarbonization strategies.
At RFF, we have an Advanced Energy Technologies project, which is quantifying the potential societal benefits of advances in technologies like geothermal power, carbon capture from gas power plants, advanced nuclear reactors, energy storage, and direct air capture as one of the ones that we've been looking at, which I'm sure we'll come back to.
Now, many of these technologies relate to decarbonization of the power sector, which is typically thought of as a building block of decarbonization for other sectors. But of course, air travel is part of the transportation sector, and as you've said, it's a particularly challenging nut to crack in terms of decarbonization.
It's one thing to set a goal, of course, and another thing to set out how to implement and plan for achieving that goal. Tell us a bit more about the specific strategies and technologies you're focused on to create a more sustainable fleet and meet the net-zero target by 2050.
Scott Kirby: Well, first I'd say you had a really good list of the kinds of technologies we need to be working on because while decarbonizing power and the grid seems more straightforward, there are a lot of those things—like advanced nuclear and storage—that we're not going to be able to do unless we do those things.
It's not as simple as building more solar and building more wind, to the point that you made. There are also, then, whole segments of the economy that are going to be really hard … There's nothing on the drawing board that allows them to be carbonized.
In aviation, the fuel density that we require is so high that we're not going to be able to power big airplanes flying long distances with either hydrogen or batteries. The weight of the batteries or hydrogen is so much that the airplane can't take off in order to fly long distances with a lot of customers. That's one example of an industry.
Steel and concrete are examples of industries that are going to be hard to decarbonize. Food production is another example of an industry that's hard to decarbonize, and so we're never going to get all the way to zero, but what we can do to offset that is different than the traditional carbon offsets?
One is direct air capture and sequestration, which you mentioned. That is literally taking carbon out of the atmosphere or from somewhere, and permanently burying it underground in the rocks, where it's stored for tens of millions of years. It’s dramatically different than planting trees, for example. It's permanent and it's scalable. We can grow it to as much as we need to get the whole economy to be zero and to offset some of the other places where there is carbon.
The other thing we can do in aviation is sustainable fuels. While we need a liquid fuel, a jet fuel, to fly airplanes, instead of having it come from oil, we can have it come from other sources. United has made over 50 percent of the world's commitment to sustainable aviation fuels. We have a number of investments in companies. What this really needs is seed capital, startup capital, and some government support, which we're actively lobbying for, to support the industry and get it rolling because, today, the problem with sustainable aviation fuels are that they're just too expensive
But much like wind and solar, people 20 years ago said wind and solar could never compete with carbon for powering the grid, and today it's cheaper to produce a megawatt with renewable energy than it is with carbon in many places in the country. The same can happen with sustainable fuels.
We're using municipal solid waste or vegetable oils, the kinds of waste products that can be used to turn into fuel. We have an investment in Archer Aviation, an electric aircraft company. While I said they're not going to fly big airplanes long distances, they can do parts of the aviation grid, particularly shorter haul, smaller markets.
Then, of course, there’s direct air capture and sequestration, which is not just an aviation issue. To me, that is a big part of the solution for the rest of the economy that can't be easily decarbonized.
Richard G. Newell: Say a bit more, Scott. You mentioned a couple of different kinds of offsets, so talking about traditional offsets, which is where a lot of activity has been historically, I think you have voiced some skepticism about that or about that as a big long-term solution.
Then there's direct air capture, which also has the purpose of compensating for emissions that are still emitted, but compensating and putting them underground. Say a little bit about how you all at United have thought about those two different kinds of offsets and what is driving you toward the direct air capture.
Scott Kirby: To start with, what I call traditional carbon offsets today are mostly planting trees. If you go look at the projects of the Conservancy Fund or any of the other groups, they're mostly about planting trees. Now, if you dig into the details of those projects, which is really, really, really, really hard to do because they're not very transparent, most of them are not incremental reduction in carbon. Most of them are things that were going to happen anyway.
In the interest of time, I won't go through some of the most egregious examples unless you ask me to, but it just makes my blood boil when I read some of these things that are carbon offsets and their projects. They're things that were happening anyway. And they make no difference. But even if all of them were incremental, mankind emits 4,000 times as much carbon as we did in the preindustrial era. There is simply not room on the planet to plant 4000 times as many trees. It cannot be the answer.
Even when they're good projects, they are a tiny, tiny, tiny drop in the bucket, relative to the 50 gigatons of carbon that we produce every year, and there's not room to plant them. Carbon sequestration is different because it is scalable. We could sequester 4,000 times as much carbon per year if we built enough plants, and we're storing it permanently. A tree will eventually die and release the carbon back into the atmosphere.
Storing it underground is a permanent solution, and by the way, it is nature's normal solution for carbon. The normal carbon cycle of the globe, before humans started producing carbon, was carbon bound to the rocks. They dove back under the plate and back into the mantle, and then carbon gets released through a volcano.
We've accelerated the process of putting it into the atmosphere. We need to accelerate the process of burying it back in the earth, where it will eventually go back into the mantle, just like it's done throughout history on the globe.
Richard G. Newell: If I understand that right, it sounds like the issue of verifying additionality and scalability and permanence are all things that led you to more of an engineered solution to offsets, in contrast to the more traditional.
Scott Kirby: They are. The scalability is the most important one because people will go debate you on the other ones, but there's no debate about scalability. You can't plant 4,000 times as many trees. Once you've reached that conclusion, you don't even have to worry about the validity and the other things.
The problem with it is that basically every company in the world that says they're going to get to net zero is doing it with carbon offsets. It's a check the box exercise. It's a marketing exercise, as opposed to really changing what's happening for carbon around the globe.
Richard G. Newell: Let's dig a little bit more into direct air capture. Tell us about what you're actually doing with direct air capture. Are you in the innovation stage of project development? Are you an investor? Are you a customer? How are you getting engaged in direct air capture?
Scott Kirby: Well, we're a junior partner with Occidental and 1PointFive, and they're really the leaders in the project. We wanted to get involved because we think it's the right thing to do. I wanted to be able to talk about it like this, and because, to me, I can't add up the 50 gigatons math without direct air capture. There's nothing on the drawing board that gets us there.
I've thought for many years that this was going to have to be the answer, so we wanted to be a partner. They're the ones doing the technology. They're great, and they're committed to it. Vicki Hollub, the CEO of Occidental, is very committed to it. It's scalable.
But the point of this is to start investing now and figure out how to drive the economies of scale and drive down the cost curve so that this can become a real alternative for every corporation because it's just so much better than the traditional carbon offset programs. We're not the ones doing the technology. We're a partner, but we can be an advocate and lend our voice to talking about this and trying to make a difference.
This is really is an issue that I care about personally. We not only do the right thing for United, our employees, and our customers, but we actually have a platform. We're a high-profile brand, where I hope we can make a bigger difference than just United Airlines. We can help lead others or influence others to get to ultimate solutions, and that's really our goal, our desire, for being a part of the Occidental-1PointFive project.
Elizabeth Wason: Each episode of RFF's Policy Leadership Series Podcast is made possible by listeners like you. This series provides thoughtful conversations with leading experts to better connect and inform our community on the latest environmental and economics issues, and you can help us.
By supporting RFF, you join us in our mission to improve environmental, energy and natural resource decisions through impartial economics research and policy engagement. Learn more about contributing to RFF today by visiting rff.org/support.
Richard G. Newell: Let's turn a little bit to sustainable aviation fuels. If I remember correctly, sustainable innovation of fuels was something that United was engaged in even before direct air capture, for a few years now. Say a little bit about how you're getting engaged there. Is it similar to direct air capture in that you're investing in innovation there, or is it more just as a customer? Say a bit about that.
Scott Kirby: Yeah, so we're probably doing more to invest in innovation directly there. The technology for direct air capture and sequestration is relatively well-known. It needs work on getting the economies of scale and driving it down the cost curve, but the basic process is well-known. I guess the same is true for sustainable innovation fuels, mostly Fischer–Tropsch.
While that process is known, we’re still figuring out how to take a ton of municipal solid waste—which is what one of our partners, Fulcrum Energy, does—and run it through a small factory and get a few gallons of fuel on the other side out of that before it goes into the plant.
Not only do we create fuel that comes from a renewable source, but that carbon that's now in the fuel would have gone into the landfill and become methane. Anybody that follows this knows methane leaks from landfills. That's much more impactful and much worse for the climate than carbon dioxide. That's an example of the sourcing.
The challenge is we're going to have to source the carbon to create the fuel from a whole lot of different sources. So we need a large investment pool because municipal solid waste is great—there's municipal solid waste everywhere, but it's nowhere close to covering what the aviation industry would need in the United States. Nowhere close.
We're going to have to find things like agricultural waste. Industrial gases are one of the things that LanzaTech is working on, where we can find the feedstock to create the sustainable aviation fuel. We're very involved, and our focus is on finding companies that are working on new, truly sustainable feedstock. Not taking arable land out of production, not growing corn to turn it into fuel, but using real waste product to create fuel.
Richard G. Newell: This is a little bit down in the weeds, but when you think about the carbon accounting around sustainable aviation fuels, like the ones that you're investing in, are those net zero? Because you're removing the methane that would come out of the landfill, then you're creating a fuel, and then when the fuel is combusted, there's carbon emissions from the combustion process. How does that stack up?
Scott Kirby: Yeah, that is a cycle where you're taking something that is carbon today and turning it into a fuel. It does emit carbon, but then you're recreating. That one is a cycle. It's not like planting a tree to offset, but it's a direct cycle where the fuel is coming from a carbon emission and directly offsetting it. But it is an offset in that sense.
Richard G. Newell: When you think about investing in sustainable aviation fuels and direct air capture, is that a near-term strategy for United or is that a long-term strategy because, ultimately, you'd be a customer for those kind of things?
Scott Kirby: Yeah. The near-term strategy is for just driving a long-term goal. In the near term, the amount of sustainable fuel we're going to use is going to be a drop in the bucket. It's going to be less than 1 percent. It just doesn't exist today. The near-term strategy for us is to invest in the R&D and the infrastructure so that in the future, it can grow to a much larger level.
In fact, we have this Eco-Skies Alliance. That partnership is with 10 of our large corporate accounts who are going to buy sustainable aviation fuel. What we're doing with that is—we're not just buying fuel—we're using that as seed money to invest in other companies and the infrastructure around creating more sustainable aviation fuel because that's what we have to do. We have to grow it. We have to grow the infrastructure, like this municipal solid waste idea.
Right now, there's two plants, but, ultimately, you can build a plant at every municipal solid waste site in the United States, if you can commercialize it and you can get it to work on a commercial scale. But we've got to get it to work on a commercial scale.
We're still in the investment stage, and we’re using our money, our support, and our commitment to buy the fuel as a way to drive investment in this space so that we can essentially use more feedstock to turn all the available feedstock into fuel.
Richard G. Newell: That's great. When you consider sustainable aviation fuels, direct air capture, and I guess there's other strategies like efficiency improvements through more efficient aircraft and more efficient routes, how did these roughly stack up in terms of shares of the solution set? Are they roughly equal or in some other?
Scott Kirby: Well, by far the biggest and most impactful thing we can do in the very short term is improvement in efficiency. We do that every year by buying new airplanes. We're buying new airplanes, and they get more fuel-efficient. But the biggest thing we can do is get to the next generation aviation system.
Today, we still fly highways in the sky. Hopefully all of you flying that are listening in, hopefully you'll be back to flying soon or already are. You'll find it's a much better experience and you feel great once you do—a little non-paid advertisement. But you fly highways in the skies, and you fly across the country. You'll go up, and you'll feel yourself turn here and turn there, instead of flying a straight line, as an example.
We estimate that we could cut the fuel emissions by 10 to 15 percent by essentially using GPS. Think of it as using GPS to fly airplanes, and it's been frustrating and maddening. You have better use of GPS technology in your car than we do in aviation. We're working hard with the administration to try to get there on that.
In the short term, there's very few things that are as low-hanging fruit as reducing emissions from aviation by 10 to 15 percent by getting to the next generation aviation, things that we have today. In the short term, that's going to be important. But in the long term, I'll say it divides up as around 25 percent new technology development, R&D, and things like electric aircrafts, and then splits 37.5 percent each on sustainable fuels.
Hopefully, we'll get to a world where all of our fuel comes from sustainable sources, but that's still not a 100 percent zero. Then, the rest is direct capture and sequestration, unless something new comes along that's better. But, right now, I'd split it like that.
Richard G. Newell: So I want to come back a little bit to carbon offsets. I know, historically, United and other airlines have had a program for voluntary carbon offsets where customers could purchase offsets for their own emissions through the traditional offsets, conserving forests and related things. Does that type of program still have a role to play in United's climate strategy or is that not around anymore?
Scott Kirby: Well, for everything I've said, we do have a program like that, but I aspire for us to ultimately replace that with options for either sustainable fuels or a carbon sequestration because those will be real difference-makers. I think of this as, again, not a marketing issue. It's not about checking the box for us or for our customers.
People just don't understand it. Once people understand sequestration versus traditional carbon offsets, most people could kind of have the light bulb go off and say, "We need to do something different." We haven't done it yet, but ultimately, I expect that our offset programs will be geared towards the real long-term solutions that are permanent, that are real, and that will really make a difference—the kinds of things we advocate for. And hopefully, the whole world is going to evolve there.
Richard G. Newell: I think you brought it up a couple of times, but we haven't really delved into it. So, for many sectors of the economy, the strategy is thought to be to decarbonize electricity and then electrify everything. My question is—what I'm hearing is that that is not a singular strategy for air travel—but what about electric aircraft? Is there any role for that to play there? Help us understand that a bit.
Scott Kirby: Electric aircrafts, I do think have a role to play. That's why we're a launch investor in Archer Aviation, but the challenge for electric aircraft is that the energy density of batteries is nowhere close to big enough or high enough to power big airplanes flying long distance.
I think it's something like my weight is 1/20 the energy density. You would need to have 20 times as much weight as the batteries, which means you simply can't fly big airplanes long distances. It's just physics. You can't do it, but you can fly a smaller aircraft short distances, so Archer Aviation is our partner.
I think that really is more of a helicopter replacement, but think about Archer Aviation. It's much quieter; it's environmentally friendly. I expect it's going to ultimately be safer because it has 12 rotors instead of 1. Think about if you're in Midtown Manhattan, the ability to have places you can fly from because it's safer. Maybe you don't have to go to a heliport anymore because it's safer and it's quieter. Then all those objections to landing on buildings and such maybe go away.
You get on a helicopter, fly over to Newark in a quiet, environmentally friendly, cost efficient way, and have premium service, and that's in the near term. But the other thing that we like about being invested in Archer is there's unknown possibilities that we haven't thought about yet.
By being invested with a technology leader, we can be on the forefront of new ideas and expanding it and where we go from here. But the real issue with batteries is energy density, and there's nothing—even on the drawing boards. I follow this stuff. There's nothing on the drawing boards of a theoretical technology that gets to the energy density that you would need to power big airplanes to fly long distance.
Richard G. Newell: So how do you think about the distance for long haul transport, potentially with battery electric power? Is this 10 miles, 50 miles, a 100 miles—what is it?
Scott Kirby: I think you could probably get up to a couple hundred miles, particularly on smaller planes. Flying an airplane, a 737 or an A320, a couple hundred miles with 150 people on board is not going to be feasible with batteries. But flying from a small city into a hub, the kind of regional markets that we serve, that's potentially feasible down the road.
Richard G. Newell: Yeah, interesting. If we go back to the 2050 goal, that's 30 years from now, so how should people be thinking about United's net emissions and falling over time? If I just took it and divided it equally, that'd be like 3 percent of current emissions each year going down. But how do you think about measuring achievement toward that long-term goal?
Scott Kirby: I don't think it'll go ratably, and the reason is because we're still in the investment stage, particularly for sustainable fuels. In the near term, we kind of get better every year by about one and a half percent efficiency—just fuel efficiency on airplanes and operational efficiency. We're sort of per annum getting one and a half percent better each year.
Then you get to the sustainable fuels, which I've already said are less than one percent right now, but we'll hit a point where it will look like an exponential curve. Once you start to get these technologies commercialized, then that can grow rapidly. But in the next couple of years, it's not going to be growing. But somewhere out, three, four or five years from now, it can grow rapidly to be a much higher percentage. You'll get a step function increase.
The same is true with direct air capture. Once the first direct air capture projects come online, you can choose how much you want to essentially sequester per year. Then, it’s an investment question of how much are you going to do. But we need to hit those step functions of turning sustainable aviation fuel into a scalable product and getting the sequestration plans to be scalable as well.
Richard G. Newell: Yep. I want to turn a little bit to broaden out more generally to the airline industry. United is the first major airline to make such an ambitious decarbonization goal. But of course, ultimately, we need the entire economy to decarbonize, if we're going to stabilize concentrations of greenhouse gases. The hope would be that other airlines would follow.
Where do you see the industry going from here in terms of climate action? Do you see the industry changing to adapt to the climate crisis? How so? And what are your hopes for the future for the entire industry?
Scott Kirby: Well, I'm going to be an optimist. Look, we have to solve this problem, so it is going to get solved. It's either going to get solved voluntarily or solutions are going to be imposed on us. I am very encouraged that, particularly as I talked to other airlines’ CEOs around the globe, they're a whole lot closer to where I am. They're not quite as geeky as me about understanding all the details, but they genuinely want to get to the right answer.
Even here in the United States, there's been a change in even the last six months of airline CEOs, for whatever reason, either trying to do the right thing or, because they view it as an inevitable, starting to ask questions and get educated. I think we're on a really good path.
I also think, broader than just aviation, we're at this unique moment in time, where hopefully we'll solve it, but there's, especially if you talk to people one-on-one, there's a growing bipartisan sense of needing to solve this. This is not a partisan issue in the way that some issues are in Washington.
Also, I would add, it's important that we solve this in a bipartisan way because that gives permanency to it. It doesn't have to be all the Republicans, but if we can get to a bipartisan solution on climate change, companies will have the confidence to invest for the long term because these are long-term investments.
These are 30-year decisions, and no one is going to make the 30-year decision that they think might change in a year and a half or in three and a half years. Getting this to be bipartisan is a hundred times better than something that is not bipartisan because it'll create some permanence.
Look, the other thing I would say is, I read an article in National Geographic a couple of episodes ago about the Clean Air Act, which is one of the most important pieces of legislation, and it saved tens of thousands of lives, but there's just a little blurb in it. The most impactful thing to me was that it passed with a 100 percent vote in the Senate and one “no” vote in the House in 1970.
It wasn't exactly like that was a calm time of bipartisan relationships with the Vietnam War and civil rights, and they managed to do it. Please, let's find a bipartisan solution on climate change.
Richard G. Newell: Amen to that. Following on your recent net-zero announcement, you announced a new Eco-Skies Alliance program, which is with a group of other corporations. Tell us a little bit about that. Is that focused specifically on aviation fuels or is it broader than that?
Scott Kirby: It is, and it's a great partnership. Thank you to the 10 that have partnered with us. We've had some others, I believe, join since then and anyone is welcome to join. What we're doing is letting companies pay extra for their flight. Essentially, they pay extra for the fuel because sustainable fuel is much more expensive today than traditional fuel, and so they pay that extra.
What we're doing at United is we are taking that and looking for other opportunities to invest in the R&D, the innovation, and the commercialization. We're not just taking that to buy a gallon of fuel. It's the old analogy. We're not just using it to give a man a fish. We're trying to learn to fish, teach a man to fish, teach ourselves to fish, and so we're using that.
Anyone that's listening, I would encourage you to email us and get involved in that program if you care. It's one of the most impactful ways because your dollar will go a lot farther by participating in that program. That’s because it's an investment dollar instead of just an operating expense spending dollars.
Richard G. Newell: Got it. This sounds like, in some sense, an expansion of your traditional offsets program, but focused on sustainable aviation fuel?
Scott Kirby: That's correct, yeah.
Richard G. Newell: I think we've gotten just about to the end of this session. I'm going to start bringing things to a close. Really, my sincere thanks to you, Scott, for a candid and really insightful conversation.
Scott Kirby: Well, thank you, Richard. You could probably tell that I'm passionate about it, and I appreciate the opportunity to talk about it because it really is the most important issue for our generation to solve. If we don't, my seven kids and all their grandkids are going to curse us someday and all of yours will as well, so it's up to us to do it.
Elizabeth Wason: That was Richard Newell, President and CEO of Resources for the Future, in conversation with United Airlines CEO Scott Kirby. If you like what you heard, remember to like or favorite RFF's Policy Leadership Series Podcast on your podcast platform of choice. We will release new episodes every month with leading environmental and energy policy decisionmakers.
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