The Study Session meeting scheduled for 2021-04-27 at Remote

Transcript

The Study Session meeting scheduled for 2021-04-27 at Remote

♫ PORT OF SEATTLE THEMED MUSIC ♫ GOOD MORNING
THIS IS COMMISSION PRESIDENT FRED FELLEMAN CALLING TO ORDER THE SPECIAL MEETING OF APRIL 27 2021
THE TIME NOW IS 9:01
WE'RE STARTING REMOTELY TODAY VIA TEAMS TO COMPLY WITH THE GOVERNOR'S SAFE START, STAY HEALTHY ORDER AND IN ACCORDANCE WITH PROCLAMATION 20-28, THIS IS A STUDY SESSION OF THE COMMISSION REGARDING SUSTAINABLE AVIATION FUELS
PRESENT WITH ME TODAY
OUR COMMISSIONERS, CALKINS CHO AND STEINBREUCK IS COMMISSIONER BOWMAN IS LIKELY TO JOIN SHORTLY
I WILL ASK THAT YOU DO A ROLL CALL OF THE COMMISSIONERS TO ENSURE EVERYONE IS IN LINE ON THE LINE
IN LINE IS NOT LIKELY
CLERK HART, PLEASE CALL THE ROLL
THANK YOU
BEGINNING WITH COMMISSIONER CALKINS HERE
THANK YOU, COMMISSIONER CHO
PRESENT
THANK YOU, COMMISSIONERS STEINBREUCK HERE
THANK YOU, COMMISSIONER BOWMAN
I DO NOT HAVE COMMISSIONER BOWMAN ON THE LINE WITH US JUST YET, BUT SHE'LL BE JOINING SHORTLY, I'M SURE
AND THE COMMISSIONER FELLEMAN, WE DO HAVE A QUORUM
THANK YOU, CLERK HART, AND THANK YOU TO MEMBERS OF THE COMMISSION STAFF AND OUR LISTENING PUBLIC ON THE TEAMS LINK FOR JOINING US TODAY
WELCOME, EVERYONE
I'M LOOKING FORWARD TO HEARING TODAY'S PRESENTATIONS ON SEVERAL RECENT INVESTMENTS BEING MADE TO SECURE THE USE AND PRODUCTION OF SUSTAINABLE AVIATION FUELS NATIONALLY, THIS NEWS IS PARTICULARLY EXCITING IN LIGHT OF THE FACT THAT THE NEW STATE LEGISLATION CREATING A CLEAN FUEL STANDARD SIGNIFICANTLY INCREASES THE LIKELIHOOD THAT SUCH INVESTMENTS WILL ALSO BE MADE IN WASHINGTON STATE
BUT FIRST, I'D LIKE TO SAY A FEW THANK YOUS TO THE PRIMARY ORGANIZATION ORGANIZERS OF TODAY'S SESSION, AARON PRITCHARD AND ERICA CHUNG FROM THE COMMISSION OFFICE
AND STEPHANIE MEYN, WHO'S AN INVALUABLE SOURCE OF INFORMATION WE'RE VERY FORTUNATE TO HAVE WITHIN THE PORT
MOST IMPORTANTLY, I'D LIKE TO THANK OUR PRESENTERS REPRESENTING NATIONAL AND GLOBAL LEADERS FROM AIRLINES, INVESTORS, PRODUCERS AND BUSINESSES WHO TOGETHER HAVE BROUGHT SAF FROM A CONCEPT TO COMMERCIAL APPLICATION
I WAS JUST TOLD THAT SAF IS ONE OF THE TOP BUZZWORDS IN CONGRESS RIGHT NOW, AND A RECOMMENDATION FROM PRESIDENT BIDENS RECENTLY CONVENED LEADER SUMMIT ON CLIMATE CALLS FOR "THE DEVELOPMENT AND DEPLOYMENT OF HIGH INTEGRITY SUSTAINABLE AVIATION FUELS"
I EXPECT FEDERAL INCENTIVES ARE FUCKED TO FOLLOW SOON
SPECIAL RECOGNITION GOES TO REPRESENTATIVE FITZGIBBON AND CENTERED CARLISLE FOR THEIR INCREDIBLE WORK ON CLIMATE LEGISLATION THIS SESSION
AND I'M PARTICULARLY ENTHUSIASTIC ABOUT THE PROJECT
THE PORT AND KING COUNTY ARE FUNDING TO EXPLORE THE FEASIBILITY OF USING THE COUNTY SOLID WASTE TO MAKE SAF AND REDUCE DEMAND ON ITS LANDFILL
THE COMBINATION OF INDUSTRY, LEADERSHIP, INNOVATION AND NEWLY CREATED STATE LEGISLATIVE INCENTIVES MAKES ME INCREASINGLY OPTIMISTIC THAT THE PORT CAN MEET OUR GOAL OF HAVING 10% OF THE FUEL USED AT SEATAC BEING SOURCED FROM REGIONALLY PRODUCE SUSTAINABLE FEEDSTOCKS
NOW, LET'S HEAR FROM OUR PRESTIGIOUS SPEAKERS TO SHOW US HOW TO GET IT DONE
THANK YOU VERY MUCH
BUT BEFORE I INTRODUCE OUR FIRST SPEAKER, I ASK ALL COMMISSIONERS AND STAFF TO REMAIN MUTED WHEN SPEAKING WHEN NOT SPEAKING
AND WE HAVE A FULL AGENDA THIS MORNING
SO PLEASE, I WILL ASK THAT THE QUESTIONS BE KEPT TO A MINIMUM AFTER PRESS AFTER EACH PRESENTATION, PLEASE USE YOUR HAND TOOL FOR ME TO RECOGNIZE YOU, AND I'LL BE WATCHING THE CLOCK TO KEEP EVERYONE ON TRACK
I WANT TO MAKE SURE WE HEAR FROM THESE FANTASTIC SPEAKERS
IT'S NOW MY PLEASURE TO INTRODUCE THE PORT SENIOR ENVIRONMENTAL PROGRAM MANAGER, STEPHANIE MEYN, TO LEVEL SET US WITH A SAP OVERVIEW
THANK YOU, COMMISSIONER FELLEMAN, DO WE HAVE THE PRESENTATION? YES, DEFINITELY
GIVE ME JUST A MOMENT AND I'LL SHARE THAT AND PULL IT UP
IN THE MEANTIME, I'D LIKE TO RECOGNIZE THE COMMISSIONER
BOWMAN HAS JOINED US
ALL RIGHT
WELCOME, COMMISSIONERS, AND THANK YOU
AND GOOD MORNING AGAIN
I'M STEPHANIE MEYN, THE CLIMATE PROGRAM MANAGER FOR THE AIRPORT
AND AS COMMISSIONER FELLEMAN MENTIONED, THE PURPOSE OF TODAY'S STUDY SESSION IS REALLY TO UPDATE THE COMMISSION AND THE PUBLIC ON ALL OF THE ADVANCEMENTS THAT HAVE BEEN HAPPENING IN THE SUSTAINABLE AVIATION FUEL SPACE SINCE WE LAST BRIEF THE COMMISSION AS A WHOLE ON THE STRATEGIC PLAN IN 2018
IT'S ALSO A CHANCE, AS COMMISSIONER FELLEMAN MENTIONED, TO DO SOME LEVEL STUDYING FOR COMMISSIONERS
I KNOW THAT THOSE WHO SERVED ON THE ENERGY AND SUSTAINABILITY COMMITTEE IN THE LAST COUPLE OF YEARS GOT A LOT MORE EXPOSURE TO THE TOPIC THAN OTHERS, AND IT'S, OF COURSE, AN OPPORTUNITY TO CELEBRATE THE PASSAGE OF THE LOW CARBON FUEL STANDARD HERE IN WASHINGTON, WHICH JUST OCCURRED THIS PAST WEEKEND
AND AS IT'S BRILLIANT TIMING
SO I'LL BEGIN WITH A VERY QUICK OVERVIEW OF WHAT SUSTAINABLE AVIATION FUEL IS, HOW MUCH IS AVAILABLE, AND THEN PROVIDE AN UPDATE ON OUR STRATEGIC PLAN AND OUR PROGRESS TOWARDS THE GOAL BEFORE TURNING IT OVER TO THE AIRLINES AND PRIVATE SECTOR PARTNERS TO OFFER THEIR PERSPECTIVES
NEXT SLIDE
SO SUSTAINABLE AVIATION FUEL IS A DROP IN FUEL MADE FROM SUSTAINABLE SOURCES, AND WHAT WE MEAN BY DROPPING IS THAT YOU DO NOT NEED TO MAKE ANY MODIFICATIONS TO TANKS OR TWO ENGINES
IT IS SOMETHING THAT CAN JUST BE DROPPED INTO THE REGULAR SUPPLY CHAIN WITHOUT ANY ADDITIONAL CHANGES
THE FUEL, IN ORDER FOR IT TO BE SUSTAINABLE, MUST BE MADE FROM SOURCES SUCH AS WASTE OILS, FROM BIOLOGICAL ORIGIN, AGRICULTURE, CULTURAL OR FOREST RESIDUES, MUNICIPAL SOLID WASTE, AND SO ON
IT CAN BE MADE FROM PURPOSEGROWN CROPS SUCH AS OIL SEEDS
BUT ONE OF THE CHALLENGES WITH IT MAINTAINING THAT SUSTAINABILITY CRITERIA IS WHAT IS KNOWN AS INDIRECT LAND USE CHANGE, OR THERE'S OTHER CRITERIA RELATED TO THOSE FEEDSTOCKS THAT MAY MAKE THAT NOT SUSTAINABLE
AND THOSE SUSTAINABILITY STANDARDS ARE SET BY THE INTERNATIONAL CIVIL AVIATION ORGANIZATION
BUT ONE THING THAT'S IMPORTANT TO NOTE IS THAT OTHER JURISDICTIONS CAN HAVE ADDITIONAL CRITERIA THAT HAVE TO BE MET
AND ONE GREAT EXAMPLE OF THAT IS THE LOW CARBON FUEL STANDARD, WHICH SETS STRICT CALCULATIONS FOR HOW INDIRECT LAND USE CHANGE IS TREATED AS PART OF THAT CARBON INTENSITY CALCULATION
AND WHAT THAT DOES IS IT MEANS THAT SOME FEED STOCKS
AND ONE EXAMPLE IS PALM OIL
THEY DON'T END UP QUALIFYING UNDER THAT THRESHOLD IN ORDER TO GENERATE CREDITS
AND SO THAT'S WHY THEY TEND NOT TO THEN BE USED, BECAUSE THEN YOU DON'T GET THE INCENTIVES ASSOCIATED WITH THEM
NEXT SLIDE
SO WHERE ARE WE TODAY? THERE'S STILL ONLY ONE PRODUCTION FACILITY IN THE US
SO I THINK WHEN I LAST BRIEFED COMMISSIONERS, THAT'S WHERE WE WERE AS WELL
THE WORLD ENERGY FACILITY IN PARAMOUNT, CALIFORNIA THAT IS SERVING LAX IS STILL THE ONLY PRODUCTION FACILITY THAT WE HAVE SORT OF COMMERCIAL AND OPERATIONAL IN THE US, BUT THERE ARE MORE VOLUMES OF SUSTAINABLE AVIATION FUEL BEING IMPORTED
NESTA FUELS OF FINLAND HAS NOW STARTED IMPORTING SOME SUSTAIN ALLEVIATION FUEL
AND I'LL TALK IN MY NEXT SLIDE ABOUT WHY THAT IS AND WHAT'S HAPPENING IN THAT SPACE
GREAT NEWS IS THAT A FACILITY IN NEVADA THAT IS FULL CRIME BIOENERGY, WHICH YOU SEE FEATURED IN THE PHOTO ON THE LEFT, IS NEARING COMPLETION, AND THAT FACILITY IS CONVERTING MUNICIPAL SOLID WASTE TO LIQUID FUELS ONTO SUSTAINABLE AVIATION FUEL
THERE'S ANOTHER FACILITY IN OREGON THAT'S UNDER CONSTRUCTION THAT IS CONVERTING FOREST RESIDUE INTO LIQUID FUELS THAT HAD A MUCH LENGTHIER PERMITTING PROCESS THAN WAS EXPECTED
SO THAT'S STILL UNDER CONSTRUCTION
UNFORTUNATELY, THAT MEANS THAT WITHOUT THIS SORT OF LARGER INCREASE IN PRODUCTION CAPACITY, WE STILL HAVE WORLDWIDE VOLUMES AT AROUND 5,000,000 GALLONS PER YEAR
I THINK WHEN I LAST BRIEF COMMISSIONED, IT WAS STILL IN THAT THREE TO 4,000,000 GALLONS PER YEAR RANGE
AND SO THAT REMAINS A CHALLENGE
BUT THE GOOD NEWS IS THAT CAPACITY IS INCREASING STEADILY
WE'RE SEEING MORE CAPACITY COMING ONLINE AS WELL IN EUROPE, AND THAT IS INCREASING OUR GLOBAL NUMBERS
NEXT SLIDE
AND SO A VERY CRITICAL REASON FOR THE INCREASED PRODUCTION AND THE COMMITMENTS THAT WE'VE SEEN JUST IN RECENT YEARS IS DUE TO THE ABILITY OF SUSTAINABLE AVIATION FUEL TO GENERATE CREDITS UNDER CALIFORNIA'S LOW CARBON FUEL STANDARD
AND THAT ALLOWANCE TO GENERATE THOSE CREDITS BEGAN IN 2019
SO THE SHIFT AND IN TERMS OF THAT DEMAND HAS REALLY BEEN MORE RECENT
AND I'LL POINT OUT THAT THE LOW CARBON FUEL STANDARD THAT WAS JUST PASSED IN WASHINGTON ON THIS WEEKEND ALREADY HAS THIS SAF CREDIT GENERATION CAPABILITY BAKED IN
AND WHAT THAT CREDIT DOES, AT LEAST IN CALIFORNIA, FROM THE VALUE OF THE CREDITS THERE IS IT REDUCES THE PRICE OF THAT FUEL BY ABOUT A DOLLAR 25 TO A DOLLAR 50 PER GALLON
AND WHEN YOU COMBINE THAT WITH FEDERAL INCENTIVES, THAT REALLY STARTS BRINGING THAT PRICE DOWN TO SOMETHING THAT THE AIRLINES CAN FIND MORE MANAGEABLE
AND SO AS A RESULT OF THAT LOW CARBON FUEL STANDARD, WE HAVE SEEN MORE SAF VOLUMES AT LAX
AND THEN WE NOW HAVE A MORE STEADY SUPPLY THAT IS BEING IMPORTED FROM NESTA FUELS INTO
SFO
ONE CHALLENGE THAT STILL REMAINS, THOUGH, IS THAT INCENTIVES STILL REMAIN SLIGHTLY HIGHER FOR ONROAD FUELS SUCH AS RENEWABLE DIESEL
SO IF YOU'RE A PRODUCER AND YOU'VE JUST MADE A HUGE CAPITAL INVESTMENT AND YOU'RE PAYING DOWN YOUR DEBT SERVICE, YOU'RE GOING TO PICK AND YOU HAVE THE ABILITY ALSO TO CHOOSE WHICH FUEL YOU MAKE, WHETHER YOU TWEAK THE PRODUCTION TOWARDS DIESEL OR TO JET FUEL, YOU'RE GOING TO PICK DIESEL IF IT'S THE ONE THAT IS THE HIGHEST REVENUE GENERATING FUEL
AND SO WE STILL HAVE SOME CHALLENGE WITH LOOKING FOR WAYS THAT WE CAN CREATE A LITTLE MORE INCENTIVE TO LEVEL THE PLAYING FIELD
NEXT SLIDE, SO NOW I'LL TALK A LITTLE BIT MORE ABOUT THE STRATEGIC PLAN SPECIFIC TO OUR AIRPORT AND OUR PROGRESS TOWARDS THE 10% SAF GOAL
NEXT SLIDE, FOR THOSE COMMISSIONERS WHO WEREN'T HERE IN 2017, JUST A QUICK REMINDER THAT THE COMMISSION STAFF GOAL THAT WAS ADOPTED THEN WAS TO HAVE A 10% BLEND OF SUSTAINABLE AVIATION FUEL HERE AT SEATAC BY 2028, AND THAT IS THE EQUIVALENT OF 75,000,000 GALLONS OF MEAT OR WHAT YOU'D CALL PURE SUSTAINABLE AVIATION FUEL BASED ON WHAT WE'RE PROJECTING FOR THE TOTAL FUEL THAT WE WOULD HAVE AT THIS AIRPORT BY 2028, AND THEN THAT WOULD INCREASE TO 25% BY 2035 AND 50% OR MORE WHATEVER IS MAXIMUM ALLOWED TO BE BLENDED BY 2050
NEXT SLIDE, SO THE SAF STRATEGIC PLAN WAS ADOPTED IN 2018 REALLY IN RESPONSE TO THAT GOAL
AND SO THAT STRATEGIC PLAN HAD FOUR MAIN PILLARS, YOU COULD SAY
AND FOR TODAY'S BRIEFING, IN ORDER TO KEEP ON TRACK WITH OUR VERY PACKED AGENDA, I WILL JUST FOCUS ON TWO OF THE KEY STRATEGIES THAT WE HAD MOST OF THE PROGRESS IN, AND THEN JUST DO A VERY QUICK UPDATE ON THE OTHER TWO
THE ONES THAT I'LL FOCUS A LITTLE BIT MORE ON IS OUR AIRLINE AIRPORT COOPERATIVE MODEL
AND THAT'S REALLY BASED ON WHAT WE SAW HAPPENING IN EUROPE AT THE TIME, WHICH IS REALLY AIRPORTS, AIRLINES AND EVEN CORPORATIONS THAT FLY ON THOSE AIRLINES COMING TOGETHER TO EITHER SEND AN AGGREGATE DEMAND SIGNAL TO THE MARKET, BUT ALSO FINDING WAYS THAT THEY CAN COVER THAT INCREMENTAL COST OF THE FUEL
THE OTHER UPDATE, AND OF COURSE, WE'LL PROBABLY MENTION IT 100 MORE TIMES TODAY
THAT IS REALLY WHAT WE DID IN THE LOCAL, STATE AND FEDERAL POLICY RANGE, BECAUSE WE REALLY FOCUSED ON THAT AS A MAJOR MILESTONE THAT WE NEEDED TO HIT
AND THEN THE TWO THAT I WON'T SPEAK AS MUCH ABOUT IS OBTAINING FAA APPROVAL TO USE AIRPORT FUNDS OR GRANTS FOR STAFF CO BENEFITS AND THE LARGE CO BENEFIT THERE IS REALLY THE AIR POLLUTION REDUCTION
WE'VE STARTED TALKING TO OTHER AIRPORTS WHO WOULD LIKE TO SORT OF WORK AS A COLLECTIVE TO REACH OUT TO FAA, BUT WE HAVE NOT YET GONE THROUGH A FULL PROCESS WITH FAA
AND THEN I WON'T TALK AS WELL ABOUT REALLY THE AWARENESS BUILDING THAT WE DID, LARGELY BECAUSE 90% PROBABLY OF OUR AWARENESS BUILDING WAS REALLY FOCUSED ON LEGISLATORS BECAUSE WE REALLY UNDERSTOOD THE CRITICAL VALUE OF HAVING A LOW CARBON FUEL STANDARD IN THE STATE AND REALLY FOCUS THAT FOR OUR AWARENESS BUILDING
SO NEXT SLIDE, ANOTHER WAY TO THINK ABOUT THE DIFFERENT PARTS OF OUR STRATEGIC PLAN IS TO CONSIDER THEM AS A WAY TO ADDRESS THE INCREMENTAL COST OF SAF COMPARED TO CONVENTIONAL JET FUEL
SO YOU CAN SEE ON THE BOTTOM IN BLUE IS THE REGULAR COST OF JET FUEL, WHICH THE AIRLINES TYPICALLY PAY
BUT THEN THERE'S AN INCREMENTAL COST ABOVE THAT IN GREEN
AND I WANT TO REALLY FIRST CLARIFY THAT THIS IS JUST AN ILLUSTRATION AND ISN'T MEANT TO REPRESENT A PARTICULAR SAF TOTAL PRICE OR A PARTICULAR PROGRAM
BUT REALLY JUST TO SHOW HOW DIFFERENT ELEMENTS CONTRIBUTE TO BRINGING DOWN THE COST CLOSER TO PARITY ARE CLOSER TO WHAT AIRLINES TYPICALLY PAY
AND YOU CAN SEE IN THIS ILLUSTRATION THAT POLICY INCENTIVES, CORPORATE BUYING PROGRAMS, FAA SUPPORT, THEY'RE ALL IMPORTANT PIECES OF THE PUZZLE
BUT WHAT THIS ILLUSTRATION DOESN'T REFLECT IS THE GOOD NEWS AT THE TOP, LIGHT GREEN PART OF THE BARREL WHICH REFLECTS THE LOW CARBON FUEL STANDARD AND THE FEDERAL RIN VALUES, IS IN ACTUALITY A MUCH BIGGER SLICE AND IN MANY CASES ABOUT A THIRD TO ABOUT HALF OF THIS GREEN INCREMENTAL COST PORTION
ARE WE TAKING QUESTIONS NOW, STEPHANIE? BUT WE DO HAVE QUESTIONS, SO I'D LIKE TO SAVE LIKE 10 MINUTES AT THE END
SO IF YOU COULD QUICKLY WRAP UP ON THIS INTRODUCTION, WE WILL BE ABLE TO ENTERTAIN SOME QUESTIONS
GREAT
A SPECIFIC SLIDE HERE, BUT WE REALLY WANT TO SAVE THE PETER
RUN THROUGH IT
ALL RIGHT, YOU'RE THE BOSS
GOODBYE, OUR COMMISSIONERS
JUST TO NOTE THAT WE HAVE FOUR MINUTES LEFT IN THIS A PRESENTATION IN 10 MINUTES AFTER FOR QUESTIONS
ALRIGHT
I'LL QUICKLY RUN THROUGH THE REMAINDER OF MY SLIDES
SO THE NEXT SLIDE, PLEASE
SO WITH RESPECT TO THAT FIRST STRATEGY, WHICH IS THE COOPERATIVE MODEL, WE DID MAKE A LOT OF STRIDES UNDER THE SLOW OF FOUR AGREEMENT THAT WAS SIGNED BY THE AIRLINES
IN 2018, ABOUT 15 AIRLINES SIGNED AN MLU TO AGREE TO PARTICIPATE IN A WORK GROUP TO DEVELOP A PLAN TO MEET THE SAF GOAL AND TO REDUCE EMISSIONS
BUT THIS WORK GROUP RECOGNIZED THAT THERE ARE SIGNIFICANT CHALLENGES TO DEVELOPING INCREASED SAF USE AT OUR AIRPORT BECAUSE ALL OF THOSE SAME AIRLINES FLY OUT OF CALIFORNIA, THEY COULD TAKE ADVANTAGE OF THE LOW CARBON FUEL STANDARD INCENTIVES THAT WERE THERE AT THE TIME
SO IN 2019, THE GROUP CAME TOGETHER WITH A STRATEGY REALLY TO FIND A HOST OF ACTIONS THAT COULD REDUCE THE EQUIVALENT AMOUNT OF EMISSIONS AS THE 10% SUSTAINABLE AVIATION FUEL GOAL ON A LANDING AND TAKEOFF EMISSION BASES, WHICH WAS ABOUT EQUIVALENT TO 73,000 METRIC TONS OF CO2 PER YEAR
AND THAT REPORT WAS COMPLETED AND PUBLISHED IN EARLY 2020
YOU CAN SEE IT AT THE TOP OF THE SLIDE AND I'LL TALK A LITTLE BIT MORE ABOUT THE STRATEGIES IN MY NEXT SLIDE
ALSO IN 2019, THE PORT HIRED WASHINGTON STATE UNIVERSITY TO EXPLORE THE ABILITY OF THIS REGION TO MEET THE 10% SAF GOAL FROM LOCAL FEEDSTOCKS
AND I'LL BE COMING BACK LATER IN THE SESSION TO TALK ABOUT THE RESULTS OF THAT STUDY AND THE CONTINUING WORK FROM THAT NEXT SLIDE
SO I NOTICE THIS ONE IS SUPER BUSY, BUT THIS SLIDE IS REALLY JUST SHOWING AN AGGREGATION OF DIFFERENT AIR SIDE IN BLUE AND LAND SIDE IN GREEN STRATEGIES THAT THE AIRLINES COULD WORK TOGETHER WITH OUR AIRPORT TO IMPLEMENT AS PART OF THAT MLU WORK GROUP IN 2020
AND I KNOW THERE'S A LOT OF TINY FONT ON THIS SLIDE, BUT THE MAIN POINT I JUST WANT TO MAKE ABOUT THE RESULTS OF THIS WORK IS THAT THE GROUP IDENTIFIED A NUMBER OF ACTIONS THAT CAN MEET THAT 73,000 METRIC TON GOAL THAT YOU SEE ON THE DASH LINE AT THE TOP
AND THEY IDENTIFIED THE COST OR INVESTMENTS REQUIRED TO MEET EACH OF THEM
AND THE MOST CRITICAL AND SIGNIFICANT ACTION YOU CAN SEE IN THE DARKEST SHADE OF BLUE AT THE BOTTOM IS BETTER AIRCRAFT APU RUNTIME COMPLIANCE, WHICH ALSO ALSO HAPPENS TO REQUIRE LOWER FINANCIAL INVESTMENTS BECAUSE WE'VE MADE MOST OF THE INVESTMENTS ALREADY HERE AT THE AIRPORT
SO FOR THAT REASON, WE CONTINUE TO FOCUS ON APU REDUCTIONS AND HAVE FORMED A TARGETED WORK GROUP WITH DELTA AND ALASKA AIRLINES TO MEET THOSE APU RUNTIME REGULATIONS THAT CAME INTO EFFECT IN JANUARY OF THIS YEAR
SO THIS IS REALLY A COMPLEMENT TO THE EMISSION REDUCTIONS THAT CAN BE DONE IN THE MEANTIME, WHILE WE BUILD UP THE SUPPLY AND BRING DOWN THE COST OF SUSTAINED ALLEVIATION FUEL
NEXT SLIDE
THIS ONE GOES WITHOUT SAYING THAT THE OTHER SAF STRATEGY WHERE WE MADE SIGNIFICANT STRIVE IS REALLY ON POLICY AND LEGISLATION
THIS COMMISSION AND THE PORT HAVE BEEN REALLY POWERFUL ADVOCATES
I REALLY THINK THE COMMISSION SO MUCH FOR THEIR CONTINUED SUPPORT IN PUTTING THE LCFF AS THE NUMBER ONE LEGISLATIVE PRIORITY OVER THE YEARS
AND I THINK THAT REALLY HELPS TO THE SUCCESSFUL PASSAGE OF THAT LEGISLATION
WHERE WE NOW SEE A LOT OF FOCUS AND INTEREST IN ENERGY IS WHAT THE BIDEN ADMINISTRATION IS DOING
WE'RE REALLY EXCITED TO SEE THE AMOUNT OF FEDERAL SUPPORT COMING
THE NEXT ONE COMING THAT WE SEE IS A BLENDERS TAX CREDIT FOR SUSTAINABLE AVIATION FUEL
THE EQUIVALENT WAS DONE FOR THE BIODIESEL INDUSTRY, AND THAT WAS SHOWN TO BE A VERY EFFECTIVE TOOL FOR BRINGING DOWN THE COST
SO WE'LL CONTINUE TO ENGAGE THE COMMISSION ON OPPORTUNITIES FOR THAT NEXT SLIDE
AND IT'S MY FINAL SLIDE
SECOND FINAL
SO WHERE WE ARE WITH MEETING THE 10% SAF GOAL IS REALLY ON TWO FRONTS
WE NEED NEAR PARITY WITH THE PRICE FOR AT LEAST THE INCENTIVES OFFERED IN OTHER JURISDICTIONS, BECAUSE ONE REAL CHALLENGE WITH THE AIRLINES AS COMPARED TO MAYBE AN ONROAD FLEET, IS THAT THEY HAVE THE OPPORTUNITY TO BUY THIS FUEL IN WHATEVER MARKET THEY'RE IN, THAT IS THE LEAST EXPENSIVE
SO IF THEY HAVE A 5% SAF GOAL AND THEY CAN BUY ALL OF THAT SAF IN THE CHEAPEST MARKET, THEY'LL CONTINUE TO DO THAT
SO WE STILL HAVE THE LCFF TOOK A GIANT CHUNK OUT OF THAT PARODY ISSUE, BUT WE'LL STILL CONTINUE TO LOOK FOR WAYS THAT WE CAN BRING THAT PRICE DOWN AND THEN WHERE WE ALSO NEED TO DO CONTINUED WORK IS A DEDICATED PRODUCTION FACILITY BEING BROUGHT ONLINE QUICKLY
AND SO WE'LL CONTINUE TO LOOK AND TALK TO THE DEPARTMENT OF COMMERCE ABOUT INCENTIVES TO SPEED PERMITTING AND TO BRING DOWN CAPITAL AND OPERATIONAL COSTS
AND WE DO SEE THOSE CAPITAL COST OPPORTUNITIES HAPPENING WITH THE BIDEN ADMINISTRATION THAT ARE VERY SIMILAR TO WHAT WE SAW THE OBAMA ADMINISTRATION OFFER
AND IS THE REASON WHY THE FACILITIES IN OREGON AND NEVADA THAT ARE ABOUT TO COME ONLINE ARE REALLY AT THE STAGE THEY'RE AT IS REALLY FROM THE CAPITAL INCENTIVE THAT THE FEDERAL GOVERNMENT OFFERED
NEXT SLIDE, PLEASE WRAP UP QUICKLY, TRULY THE FINAL SLIDE
SO REALLY, THE MAIN DEVELOPMENT SINCE 2018, OF COURSE, IS THE LOW CARBON FUEL STANDARD PASSAGE, WHICH IS JUST THIS WEEKEND
BUT WHAT WE ALSO SAW A LOT OF PROGRESS IN IN WHERE I THINK THIS STUDY SESSION IS GOING TO BE A REALLY FANTASTIC LEVEL SETTING IS WHAT'S HAPPENED IN THE PRIVATE SECTOR
WE SAW HINTS OF THIS IN EUROPE THAT THERE IS THIS IDEA THAT CORPORATIONS WOULD LIKE TO REDUCE THEIR FLYING EMISSIONS ASSOCIATED WITH THEIR BUSINESS TRAVEL IN WAYS THAT WERE DIRECTLY ASSOCIATED WITH THE SUSTAINABLE AVIATION FUEL, RATHER THAN BUYING OFFSETS THAT WERE UNRELATED TO THAT
AND SO WE WILL HAVE SPEAKERS TODAY FROM THE AIRLINES AND THE PRIVATE SECTOR TALKING ABOUT WHAT'S HAPPENING IN THAT SPACE TO REALLY ADVANCE THAT
AND WHAT WE'VE ALSO SEEN IS EUROPEAN NATIONS ACTUALLY SENDING A SIGNAL TO SET NATIONAL SAF TARGETS
SO WE SAW NORWAY AND SWEDEN, THEIR NATIONAL GOVERNMENTS HAVE ANNOUNCED INTENTIONS TO SET NATIONAL TARGETS FOR THE PERCENTAGE OF SAF IN THEIR FUEL BLEND
SO WE REALLY ARE SEEING A GROWTH AND A MOMENTUM THAT HAS REALLY ACCELERATED JUST IN THE LAST TWO YEARS IN THIS SPACE
SO WITH THAT ALL I'LL CONCLUDE, MAKE SURE WE HAVE THE TIME FOR QUESTIONS BEFORE WE MOVE ON TO OUR OTHER PRESENTERS
THANK YOU
THANKS SO MUCH, STEPHANIE
WE DEFINITELY HAD A DIFFERENCE IN TIME SCHEDULE AT THE CLERK
SO I WOULD LIKE TO JUST TAKE A COMMISSIONER IN STEINBREUCKS QUESTION
WE HAVE ACCESS TO YOU AS OUR COMMISSION, HAVING YOU AS AN IN HOUSE TALENT
SO COMMISSIONER STEINBREUCK, YOU'VE BEEN VERY PATIENT
LET'S JUST TAKE YOUR QUESTION
AND VERY MUCH SO THIS PRESENTATION, WHO ARE THE INDUSTRY EXPERTS? THANK YOU
I JUST WANTED TO HEAR HOW LARGE IS THE GAP BETWEEN THE MARKET PRICE FOR CONVENTIONAL FUEL AND THE ESTIMATED TOTAL COST OF PROVIDING THE SAF? WHAT IS THAT GAP THAT HAS TO BE CLOSED? WHAT'S THE DIFFERENTIAL? YEAH
THE DIFFERENTIAL IS VERY DEPENDENT ON THE TECHNOLOGY AND THE FEED STOCK
SO NOT ALL SAFIS THE SAME PRICE
THE SAF THAT'S AVAILABLE IN THE MARKET RIGHT NOW IS
AND I'M GOING TO HAND WAVE A LITTLE BIT HERE BECAUSE THESE ARE GUARDED SECRETS IN THE PRIVATE SECTOR, BUT IT'S GENERALLY YOU COULD HAND WAVE AT ABOUT SIX DOLLARS A GALLON AND YOU COMPARE THAT TO ABOUT TWO DOLLARS A GALLON
THAT IS SORT OF THE TRADITIONAL JET FUEL PRICE
SO YOU'RE TALKING ABOUT A FOUR DOLLARS INCREMENT
BUT WE'RE NOW SEEING THAT THESE FEDERAL AND STATE INCENTIVES COLLECTIVELY CAN BRING THAT DOWN BY ANOTHER
MAYBE YOU CAN GET IT UP TO THREE DOLLARS OFF THE TOP OF THAT
SO YOU'RE STILL LEFT WITH MAYBE A DOLLAR
BUT WHEN YOU MULTIPLY THAT BY THE NUMBER OF GALLONS IN JUST ONE AIRPLANE, IT GETS TO BE PRETTY PRICEY
SO EVERYTHING WE CAN DO TO BRING THAT COST DOWN IS CRITICAL
YEAH
AND THAT'S THE NUMBER ONE OPERATING COST FOR FOR COMMERCIAL AIRLINES
SO THAT'S A PRETTY BIG SPREAD THERE
OKAY
AND OF COURSE, AS THE SUPPLY INCREASES, THE PRODUCTION INCREASES, THE COST COMES DOWN
BASIC ECONOMICS
YES
AND I'LL HAVE A LOT MORE IN MY PRESENTATION AT THE END ON THE FINDINGS FROM THE WSU REPORT THAT WILL OUTLINE HOW THE CAPITAL AND THE OPERATIONAL COST INFLUENCE THE FINAL COST OF FUEL
RIGHT
OKAY
THANK YOU
I'M DONE
THANKS VERY MUCH FOR THAT IMPORTANT QUESTION TO HAVE CLARIFIED
AND THANKS AGAIN SO MUCH, STEPHANIE
WE REALLY APPRECIATE HAVING YOUR IN HOUSE TALENT
AND THANK YOU FOR MY COLLEAGUES FOR ALLOWING US TO GET BACK ON TIME PRECISELY BECAUSE THE POINT IN MATTER IS THE FACT THAT THERE STILL IS A DELTA
SO WE SAY IN THE COSTS, THE AIRLINES ARE USING IT
AND SO IT'S REALLY THIS IS WHAT I WOULD LOVE TO HEAR, HOW THEY ARE MAKING THIS WORK AND HOW WE CAN HELP MAKE IT WORK HERE IN WASHINGTON
SO NOW I'D LIKE TO WELCOME KIRK MYERS FROM ALASKA AIRLINES, KEITH TAYLOR FROM DELTA AND TOM MICHAELS FROM UNITED
EACH OF OUR GUESTS WILL HAVE 10 MINUTES FOR PRESENTATION, AND WE HAVE AN ADDITIONAL FIVE MINUTES FOR COMMISSION QUESTIONS AFTERWARDS
OUR FIRST PRESENTER IS KIRK MYERS, SUSTAINABILITY DIRECTOR FROM ALASKA AIRLINES
THANK YOU FOR JOINING US TODAY, KIRK
AND PLEASE LET US KNOW WHEN YOU'RE READY TO DISPLAY YOUR PRESENTATION, AND THE CLERK WILL ADVANCE THE SLIDES WHEN YOU SIGNAL OR YOU HAVE THE FLOOR
THANK YOU, COMMISSIONER FELLEMAN
AND GOOD MORNING TO EVERYBODY
VERY EXCITED TO HAVE THE OPPORTUNITY AND INVITATION TO SHARE A BIT OF OUR PATH ON STAFF HERE IN ALASKA AIRLINES
AND I DO HAVE A BRIEF PRESENTATION SO WE CAN START SHARING THAT NOW AS THAT GETS PULLED UP
JUST WANTED TO SAY THANK YOU TO STEPHANIE FOR, AS ALWAYS, A REALLY COMPREHENSIVE YET CONCISE OVERVIEW OF THE SAF MARKET
AND SHE SET THE STAGE VERY WELL FOR SOMETHING, BUT I CAN SPEND A BIT LESS TIME ON SINCE SHE COVERED IT SO WELL
SO I'M STANDLEY DIRECTOR IN THE LAST AIRLINES, KIRK MYERS IS KISHA ELLEN SAID, WE'VE BEEN ON A JOURNEY OF SAF IN SAFINNOVATION FOR OVER A DECADE, SO IF WE GO TO THE NEXT SLIDE, I CAN SHARE A LITTLE BIT AROUND WHAT WE'VE BEEN DOING IN THIS SPACE
FIRST OFF, WE'RE REALLY, REALLY PROUD AND EXCITED
LAST WEEK, WE LAUNCHED OUR NEW CLIMATE GOALS
SO WE HAD HAD A SET OF CLIMATE GOALS VOLUNTARY CLIMATE GOALS THAT LED US THROUGH 2020 AND LAST WEEK WAS LAUNCHING OF A NEW AND VERY WHAT WE CONSIDER TO BE A BOLD AND AGGRESSIVE GOAL AROUND BEING NET ZERO ENERGY OR AT ZERO CARBON BY 2020
AND THIS SLIDE A LOT OF WORDS HERE
YOU CAN FIND IT ON OUR WEBSITE
I CAN SHARE IT IN OTHER WAYS IF IT'S APPROPRIATE
SHOWS THE PATHWAYS THAT WE SEE NEEDED INNOVATION AND SUCCESS ON TO NET ZERO 2040 GOAL
AS YOU LOOK HERE AT THE FOUNDATION, OPERATIONAL EFFICIENCY IS ABSOLUTELY A KEY THING THAT WE ARE FOCUSING ON WHERE THE NEXT YEAR OR TWO AND BUILDING A CULTURE OF EFFICIENCY AROUND CARBON
JUST AS WE HAVE A CULTURE OF SAFETY
OUR ANNOUNCEMENT AROUND UPGRADING OUR FLEET WITH A SIGNIFICANT NUMBER OF NEW ADDITIONAL MAX AIRPLANES HELPS US OUT QUITE A BIT
BUT AS WE LOOK FORWARD, ESPECIALLY OVER THE NEXT THREE TO 5 YEARS AND BEYOND, STABILZATION FUEL IS ABSOLUTELY ONE OF THE BIGGEST ELEMENTS OF AREAS THAT WE NEED TO FIND SUCCESS IN FINDING THAT KIND OF FIT BETWEEN FINANCIAL PERFORMANCE AND ALSO HAVING SCALE OR IN THE MARKET
AND WE LOOK AT THIS CHARTER SOUND IS ACTUALLY THE AREA THAT HAS THE MOST VARIABILITY IN TERMS OF MODELING AND OUR FORECASTING LOOKING FORWARD BASED EXACTLY ON WHAT STEPHANIE SAID AROUND POTENTIAL PRICING AROUND POTENTIAL VOLUMES, AND THAT'S REALLY OUR FOCUS IS TO HELP ACCELERATE THE GROWTH OF THIS MARKET AS QUICKLY AS POSSIBLE IN THE MOST SUSTAINABLE WAY, BUT FINANCIALLY AND OF COURSE, ENVIRONMENTALLY
SO MOVING TO THE NEXT SLIDE, WE ARE ALSO REALLY PROUD THAT WE BUILT INTO OUR INTERNAL EMPLOYEE BONUS PROGRAM FOR ALL EMPLOYEES PERFORMANCE METRIC AROUND OUR CARBON EFFICIENCY FOR THIS YEAR
WE BELIEVE WE'RE ONE OF THE FIRST AIRLINES AND ACTUALLY ONE OF THE FIRST 400-500 COMPANIES TO DIRECTLY TIE PERCENT, IN THIS CASE, 10% OF OUR ALL EMPLOYEE BONUS PROGRAM TO OUR PERFORMANCE ON OUR CARBON EFFICIENCY, WHICH DIRECTLY RELATES TO OUR FUEL USE AND DIRECTLY RELATES TO ALSO IN THE FUTURE, ADDITIONAL VOLUMES OF SAFCAN HELP REDUCE THAT CARBON INTENSITY
THIS IS PART OF THE ALASKA WAY
WE HAVE A VERY STRONG CULTURE, VERY OPERATIONALLY SAVVY CULTURE AND REALLY ESTABLISHING WITH ALL OF OUR TEAMS THINKING ABOUT THIS EFFICIENCY AVERAGING OF USING LESS FUEL IN THE FIRST PLACE HELP US ON OUR CARBON PATH AND OF COURSE, REDUCES THE GAP THAT WE NEED IN TERMS OF THE GALLONS OF SAF TO HELP ACHIEVE OUR GOALS
SO NEXT SLIDE, AS I MENTIONED, WE'VE HAD A LONG HISTORY OF THE SPACE FROM JOINING THE STATION FUEL USERS GROUP BACK IN 2009 TO ACTUALLY FLYING THE MOST NUMBER OF EARLY FLIGHTS
COMMERCIAL FLIGHTS WITH SOME SUSTAINABLE AVIATION FUEL HAVE PIONEERING PRODUCTION BATCHES
AND THROUGH THAT, WORKING IN THE PAST DECADE OF WORK WAS REALLY AROUND WHAT STEPHANIE HAD TALKED ABOUT AROUND VALIDATING SAF AS A DROP AND FUEL DOING TESTS AND PILOTS AROUND NEW FEEDSTOCKS, NEW PRODUCTION PATH WAYS
ALL OF THE THINGS THAT REALLY ARE SETTING THE STAGE FOR A ROBUST AS WE HOPE WE SAF MARKET AND A PRODUCTION MARKET BASICALLY FOR EVERYBODY
SO WITH THIS WE HAVE SOME LAWS AND LONG PARTNERSHIPS WITH WSU AND WITH A C PROGRAM AND WITH NARA AND DIFFERENT GROUPS LIKE THAT
A LOT OF CONNECTION WITH THE PORT OF SEATTLE
AND AS IT MENTIONS HERE ON THE BOTTOM OF THE SLIDE, WE ARE DOING AN OFF TAKE ON ONGOING OFFTAKE AT SAN FRANCISCO AIRPORT WITH THE NESTA FUEL THAT STEPHANIE MENTIONED, ALONG WITH SOME OTHER AIRLINES MOVING TO THE NEXT SLIDE
HERE SOME OF OUR NEWEST WORKS AS WE SHIFT FROM THIS KIND OF ESTABLISHING WITH THE MARKET AND REALLY PIONEERING, AND PROVING OUT THAT SAF IS A DROP IN TO REALLY TRY AND SCALE THE MARKET TO MAKE THIS EVERYDAY USE WITHIN AIRLINES ACROSS THE COUNTRY AND ACROSS THE WORLD
WE'VE TAKEN SOME OF THE NEW APPROACHES AROUND PARTNERING WITH FOLKS LIKE MICROSOFT AND JULIE FIDDLER IS ON THE AGENDA LATER
SHE CAN TALK MUCH MORE DEEPLY ABOUT THAT PART PARTNERSHIP, BUT LEANING INTO THESE KEY CORPORATE LEADERS WHO HAVE VERY SEELY BOTH CLIMATE GOALS AND VERY POWERFUL CLIMATE GOALS AND NEED THEIR CORPORATE TRAVEL TO HAVE LESS CARBON INTENSITY AND IDEALLY ZERO CARBON INTENSITY AND THEN RUNNING THEIR BUSINESS AND MOVING FORWARD
SO WE LAUNCHED A RENEWABLE ROUTE PROGRAM WITH MICROSOFT LAST FALL AND THEN ALSO JUST RECENTLY WE ANNOUNCED AN MLU WITH SKY ENERGY
AMERICA IS LOOKING SPECIFICALLY AT CREATING SAF FROM DISCIPLE SOLID WASTE HERE IN PACIFIC NORTHWEST
ADDRESSING SOME OF THOSE CHALLENGES, ARE LOOKING TO FIND WASTE TO INNOVATE AND POTENTIALLY CREATE PRODUCTION VOLUME, AS WE HOPE HERE IN THE NORTHWEST AND HAVE ALL THE CO BENEFITS TO THAT AS WELL AS FUEL SUPPLY FOR WHERE OUR BIGGEST CONSUMPTION IS, WHICH IS HERE
NEXT SLIDE
YEAH, JUST A LITTLE BIT MORE ABOUT THE MICROSOFT STAFF PARTNERSHIP
I'M SURE JULIE WILL GO AND MORE DEPTH WITH THE DEEP WORK THEY'RE DOING THE SPACE
BUT WHAT WE LAUNCHED WITH MICROSOFT WAS ESSENTIALLY USING SAF IN THIS CASE IN CALIFORNIA IS STEPHANIE HAD MENTIONED AROUND WHERE THE VOLUME IS OCCURRING RIGHT NOW TO ESSENTIALLY TARGET THE FLIGHTS THAT MICROSOFT IS TAKEN FROM SEATTLE DOWN TO THERE ON THEIR MOST FREQUENT ROUTE DOWN TO CALIFORNIA TO THE BAY AREA AS WELL AS TO SAN DIEGO
AND IN THAT IN THAT SPACE RIGHT NOW, LEVERAGING AND PARTNERING AND COLLABORATING IN THE SPACE AROUND TRYING TO REDUCE THIS COST PREMIUM AND GET SOME ADDITIONAL FUNDING
I HAVE SUPPORT FOR MAKING IT MORE VIABLE TO PICK UP MORE VOLUMES
THAT'S EXACTLY THE CONCEPT HERE
AND I THINK SOME OF THE PARTNERS OR OTHER AIRLINES, WE'LL TALK ABOUT SOME OF THE NEW RECENTLY ANNOUNCED CONVERSATIONS THAT HAVE HAPPENED, OTHER PARTNERSHIPS IN THE CORVET SPACE
AND WE CERTAINLY ARE LOOKING IN THE SAME WAY TO LOOK UP AND DOWN OUR KEY PARTNERS ON THE WEST COAST TO ACCELERATE AND GROW THIS GROUP OF THE WHO CAN DO THIS WORK AND ARE WILLING TO DO THIS WORK
NEXT SLIDE
AND THIS IS MY LAST SLIDE
SO I'LL KEEP THIS BRIEF HERE, BUT WE DID LAUNCH THE STANDARD AMERICA'S MLU
WE'RE VERY, VERY EXCITED ABOUT WHERE THIS MIGHT GO
WE BELIEVE THAT THE SAF MARKET NEEDS TO BE ROBUST
IT NEEDS TO BE BROAD AND NEEDS TO BE DYNAMIC
IT NEEDS TO INCLUDE MANY DIFFERENT FEED STOCKS, AND THERE ARE POTENTIAL, MANY DIFFERENT PROCESSES THAT COULD BECOME ECONOMICALLY VIABLE IN THIS SPACE
AND SO THIS MLU IS SOMETHING IS REALLY LOOKING SPECIFICALLY AT PACIFIC NORTHWEST
THERE IS A STRONG POLICY CONVERSATIONS
SO THE EVENING THEY ARE THE WEEKENDS DO HERE IN WASHINGTON STATE IS VERY EXCITING
AND ALSO I WANT TO MENTION THAT ERIC SCHOENFELD, AS WELL AS KATE GALEVECTOR, WHO IS OUR DIRECTOR OF GOVERNMENT AFFAIRS IN DC, HAVE BEEN PARTNERING HAND IN HAND ON FEDERAL POLICY AROUND THE BLENDER'S TAX CREDIT AND SOME OF THE FEDERAL STEPS THAT COULD BE IMPLEMENTED TO HELP REDUCE THIS COST PREMIUM FOR US
AND SO THAT PARTNERSHIP IS GREATLY APPRECIATED
IN ADDITION TO THEM BRINGING IN SOME ADDITIONAL PARTNERS LIKE WSU, BOEING AND AND A FEW OTHER KEY FOLKS TO REALLY ADVOCATE FOR WHAT'S GOING TO BE MOST BENEFICIAL TO OUR REGION INTO THE THE GOALS THAT WE HAVE HERE
WITH THIS SKYNRG
ONE NOTE AROUND IT IS THAT IT IS THINKING ABOUT MUNICIPAL SOLID WASTE, OF TRUE WASTE, AND SOMETHING THAT WE SEE AS A POTENTIALLY IS A VERY FUNCTIONAL AND VALUABLE FEEDSTOCK MOVING FORWARD, SOMETHING THAT USING THIS AS A FEEDSTOCK WILL SOLVE MULTIPLE CHALLENGES AND PROVIDE MULTIPLE BENEFITS TO THE LOCAL COMMUNITIES IN THE AREAS WHERE WE'RE WORKING AT
SO IS THAT I'LL STOP AND KEEP THIS SHORT
BUT I REALLY APPRECIATE THE TIME
AND AND I'M THE LONG PARTNERSHIP THAT YOU'LL AIRLINES HAD FOR SEATTLE THROUGH THE MLU WORK THROUGH DIFFERENT STUDIES AROUND INFRASTRUCTURE AND HOW TO GET SAF TO THE AIRPORT AS WELL AS THE ONGOING WORK THAT IS GOING ON
SO THAT I'LL STOP AND SEE IF THEY'RE QUESTIONS
WELL, THANKS SO MUCH, KIRK
IT'S GREAT TO HAVE THIS BRILLIANT WORK GOING ON RIGHT IN OUR BACKYARD
SO LET'S MOVE ON TO QUESTIONS AND COMMENTS FROM THE COMMISSION
CLERK
HART, COULD YOU PLEASE CALL THE ROLL? THANK YOU
BEGINNING WITH COMMISSIONER BOWMAN
COMMISSIONER BOWMAN, IF YOU'RE ON THE LINE, STAR SIX TO UNMUTE
I UNDERSTAND SHE WAS HAVING SOME TECHNICAL PROBLEMS EARLIER THAT'S COME I UNDERSTAND
THANK YOU
WE'LL MOVE TO COMMISSIONER CALKINS
HI
GOOD MORNING
AND THANKS FOR THE PRESENTATION
SO FAR
BOTH KIRK AND STEPHANIE, IT IS TRULY EXCITING TO GET TO BE IN THE SEAT AND FEELING LIKE WE'RE AT THE VANGUARD OF SOMETHING REALLY EXTRAORDINARY FOR OUR REGION AND OUR PORT AND OUR PORT PARTNERS, LIKE THE AIRLINES
I GUESS MY QUESTION IT WAS MENTIONED IN STEPHANIE'S PRESENTATION
SLOW FIVE WAS A MECHANISM BY WHICH THE AIRPORTS AND THE PORT AND THE AIRLINE COULD ALIGN EXPECTATIONS ON WHERE WE'RE GOING WITH SAF
AND I'M WONDERING IF SLOW SIX WOULD BE AN APPROPRIATE MECHANISM FOR ADVANCING THAT RELATIONSHIP
THE MLU IS SUCCESSFUL IN GETTING EVERYBODY ON THE SAME PAGE AS THE PLAYBOOK WE NOW HAVE AN LCFS IN WASHINGTON STATE
AND SO A BIG CONCRETE QUESTION FOR US IS WHAT'S NEXT? AND I THINK WE'LL BE MOST SUCCESSFUL IF WE ALL AGREE AND PUT IT ON PAPER
AND SO I'M WONDERING IF THAT'S A MECHANISM FOR DOING THAT
AND THEN MY SECOND QUESTION IS AROUND THE LOW HANGING FRUIT OF APU USAGE AT THE AIRPORT
AND AGAIN, THIS IS A QUESTION THAT MAY NOT BE ABLE TO BE ANSWERED HERE, BUT I AM WONDERING HOW MUCH OF THAT REDUCING THE USE OF THE APU REALLY RESTS WITH THE PORT, PROVIDING THE INFRASTRUCTURE NEEDED FOR PLANES TO BE ABLE TO PLUG IN QUICKER, AND HOW MUCH OF THAT IS JUST HABIT OR NEED TO CHANGE KIND OF PRACTICES AT THE AIRLINE LEVEL
RYAN, THAT'S TWO QUESTIONS
PLEASE PICK ONE OF THEM
THESE CAN BE ADDRESSED IN WRITING TO US BEYOND THIS
I KNOW THESE ARE BIG QUESTIONS, BUT I JUST WANTED TO THROW THOSE OUT THERE
GREAT COMMISSIONER CALKINS
I WILL DEFER ON THE SLOW QUESTION
I THINK THE PARTNERSHIP IS ABSOLUTELY KEY, AND THAT'S OUR AIRPORT PEERS TEAM VALLEY, WICK, AND I SPEND MORE TIME ON THE COURSE STABILITY SIDE
SO I'M NOT EXPERT TO SPEAK ON THAT FOR ALASKA, BUT IN TERMS OF APU USAGE, WE ARE LOOKING VERY ACTIVELY
I MENTIONED THAT CULTURE OF EFFICIENCY
WE ARE GOING BACK IN AND REALLY LOOKING AT OUR OPERATIONAL BEST PRACTICES AND REALLY LOOKING AT HOW DO WE MAXIMIZE THE OF OUR APU OR MINIMIZE THE VERY FEW AS WELL AS THINGS LIKE SINGLE AND TAX AND EVERYTHING IS ESSENTIALLY INVOLVED IN THE AIRPORT TURN
WE'VE GOT SOME INTERNAL CONVERSATIONS BOTH BETWEEN ALASKA MAINLINE AS WELL AS HORIZON, OUR REGIONAL AIRLINE, TO LOOK AT THOSE OPPORTUNITIES AND REALLY MAXIMIZE THAT
WE WANT TO BE THE MOST EFFICIENT AIRLINE IN TERMS OF HOW WE RUN OUR OPERATIONS
WE BELIEVE THAT'S GREAT FOR THE BUSINESS
IT'S GREAT FOR THE ENVIRONMENT
AND IT REALLY IS PART OF SOMETHING THAT WE'VE EXCEL AT
SAFETY
INSTEAD OF TAKING THAT MODEL IS REALLY KEY
WE CAN GO IN FURTHER DETAIL AROUND WHEN SOMETHING DOESN'T WIN
THERE ARE GAPS
WHAT ARE THOSE WHAT'S OCCURRING IN THAT SPACE BECAUSE THERE MIGHT BE A WINTER STORM? OR ARE THERE DIFFERENT CONTINGENCIES THAT HAPPENED? BUT IDENTIFYING, AND MINIMIZING THOSE THAT OUR STANDARD OPERATING PROCEDURES IS TO DO THE BEST THAT WE CAN IS ABSOLUTELY ONE OF OUR GOALS
THAT'S GREAT, KIRK
AND I THINK THIS IS ONE OF THOSE THINGS THAT THE START FORUM SHOULD REALLY BE MONITORING AS WELL
CLERK HART, THE NEXT SPEAKER
COMMISSIONER, PLEASE
THANK YOU
COMMISSIONER BOWMAN
I DO SEE THAT SHE'S JOINED THE CALL
WE'LL COME BACK
COMMISSIONER CHO, YEAH
THANKS SO MUCH FOR BEING HERE TODAY
I WANTED TO ASK YOU A QUESTION WITH REGARDS TO THE BROADER MACRO LEVEL PERSPECTIVE
OBVIOUSLY, WHAT WE DO HERE IN THE PACIFIC NORTHWEST IS A VERY SMALL PORTION OF THE FOOTPRINT WHEN IT COMES TO AVIATION FUEL
AND SO I WANTED TO GIVE YOUR THOUGHTS ON WHAT WE COULD BE DOING OR WHAT WE SHOULD BE ADVOCATING MORE ON A NATIONAL LEVEL TO GET THE ENTIRE INDUSTRY TO ADOPT A SUSTAINABLE AVIATIONAL FUELS FASTER
SO IT'S A GREAT QUESTION
AND PETE GALLAGHER AS I MENTIONED IS OUR DIRECTOR ON AFFAIRS WHO WORKS REALLY ON THE FEDERAL POLICY LEVEL
AND THAT IS AN AREA WHERE THE PARTNERSHIP THAT'S ONGOING WITH PORT OF SEATTLE AND OTHER PARTNERS IS REALLY, REALLY KEY
WE DO BELIEVE THAT HAVING FEDERAL POLICY AND SUPPORT IN THE SPACE IN THE APPROPRIATE WAY IS KEY TOWARDS SCALING THIS MARKET AND EACH SAF PROCESS
STEPHANIE MENTIONED THIS, I GOT ITS OWN UNIQUE ECONOMIC DRIVERS IN DIFFERENT VARIABLES THAT PLAY INTO IT IN EACH REGION ALSO HAS ITS OWN VARIABLES
SO HAVING CONSISTENT KNOWN SUPPORT SPECIFICALLY AROUND SAF IS THE LARGEST THING I THINK COULD BE HELPFUL IN TERMS OF SUPPORTING THIS AND ALLOWING THE DIFFERENT REGIONS TO FIND WHAT SOLUTIONS WORK ECONOMICALLY AND ALSO FROM A SUSTAINABILITY PERSPECTIVE FOR THOSE AREAS
GREAT
THANK YOU
SO WE'RE VERY LUCKY TO HAVE HIM WORKING WITH SCHOENFELD ON THIS
WE HAVE THE TALENT TO DO THAT
SO PLEASE, WHO'S THE NEXT? THANK YOU, COMMISSIONER
SIR, PLEASE
SOMEBODY HAS THEIR XYLOPHONE GOING, PLEASE MUTE
IS IN THE MORNING
KURT, THANK YOU VERY MUCH FOR THIS REALLY INTRIGUING PRESENTATION
I THINK THERE'S A LARGER PICTURE HERE THAT YOUR PRESENTATION SPEAKS TO BEYOND SAF, WHICH IS THE FOCUS OF THIS STUDY SESSION, ALWAYS AND MEANS IN WHICH WE CAN REDUCE THE CARBON FOOTPRINT
AND YOU OUTLINE FIVE STRATEGIES THERE, INCLUDING SAF
BUT I RECALL A FEW YEARS AGO WHEN I FIRST JOINED THE COMMISSION, I ASKED ALASKA, WHAT HAS BEEN YOUR ACCOMPLISHMENT WITH REGARD TO REDUCING CARBON EMISSIONS THROUGH WHATEVER MEANS? AND I RECALL A FIGURE OF 37% REDUCTION WITH THE STRONGEST RESULTS COMING FROM FLEET UPGRADES
SO I JUST WANT TO POINT THAT OUT
LET'S LOOK AT THE TOTAL PICTURE HERE AND ALL MEANS AND WAYS TO ACHIEVE THE RESULTS WE'RE SEEKING
I DO BELIEVE THE SAF IS AN IMPORTANT COMPONENT OF THIS AND THAT IT HAS A VERY PROMISING FUTURE NOW, ESPECIALLY WITH THE CARBON FUEL STANDARD LEGISLATION JUST PASSED
I WANTED TO ASK YOU ABOUT NOVEL PROPULSION, WHAT WORK HAS BEEN DONE THERE, AND HOW DOES THAT FIT INTO THE PICTURE AS ONE OF YOUR FIVE STRATEGIES? IT'S A GREAT QUESTION
IS SOMETHING WE'RE LOOKING AT VERY CLOSELY? WE HAVE A PILOT OR FLIGHT OPERATIONS TEAM WHO HAS A DEEP EXPERIENCE IN INNOVATION AND IN DIFFERENT AREAS OF SUSTAINABILITY IN NOVEL PROPULSION, BOTH WITHIN ALASKA AND OUTSIDE OF ALASKA
AND WE HAPPEN TO BE HERE ON THE WEST COAST WHERE A LOT OF INTERESTING INNOVATION IS HAPPENING WITH HYDROGEN, WITH ELECTRIC HYBRID, WITH DIFFERENT VERSIONS AND DIFFERENT TECHNOLOGIES THAT WE SEE AS A POTENTIAL FIT IN THE MID TO LONG TERM, CERTAINLY ESPECIALLY FOR OUR REGIONAL SEAT
AND SO WE ARE INVESTING TIME, ENERGY AND TO UNDERSTAND WHERE WE CAN INNOVATE AND CEO WOULD HELP WITH OUR EXISTING FLIGHT LOAD IN OUR CIP CAPACITY IN THIS SMALLER AIRCRAFT, WHERE WE SEE THE BIGGEST OPPORTUNITY FOR MAIN LINE
WE THINK THAT SAF IS REALLY EFFICIENCY
JUST AS YOU MENTIONED, WE ARE VERY PROUD THAT WE'VE INCREASED OUR EFICIENCY SIGNIFICANTLY SINCE 2009 WITH FLEET UPGRADES WITH OTHER OPERATIONAL UPGRADES, AND THAT'S ABSOLUTELY NECESSARY AND NOT SUFFICIENT TO GET US ALL THE WAY TO THE GOAL WE WANT TO THAT WE WANT TO HAVE
GREAT
THANK YOU VERY MUCH
THANKS, KURT
I WOULD LIKE TO TAKE THIS TIME TO REALLY APPRECIATE WORKING IN ALASKA DOES AND WILL NOW HEAR FROM KEITH TAYLOR, SUSTAINABLE AVIATION AND QUALITY GENERAL MANAGER WITH DELTA AIRLINES
PLEASE LET US KNOW WHEN YOU'RE READY TO DISPLAY YOUR PRESENTATION AND THE CLERK WILL ADVANCE THE SLIDES WHEN YOU SIGNAL
KIRK, THE FLOOR IS YOURS
SO GOOD MORNING TO EVERYBODY
MORNING COMMISSION
FIRST OF ALL, THANK YOU FOR ALLOWING US TO HAVE THIS OPPORTUNITY TO PRESENT OUR STRATEGIES THAT ARE KEY TO SUSTAINABLE AVIATION AND SUSTAINABLE FUELS AS WELL AS THE CLIMATE
YOU CAN PRESENTATION, PLEASE
I'M SORRY, KEITH
DID I SAY KIRK, I MISS YOU, BUT THAT'S OKAY
THAT'S OKAY
NO WORRIES
MY APOLOGIES
WE'RE HEARING NOW FROM KEITH TAYLOR WITH DELTA AIRLINES
I'M SORRY
AGAIN
YES
SO AGAIN, I'M KEITH TAYLOR
I'M THE GENERAL MANAGER, SUSTAINABLE FUELS AS WELL AS FUEL QUALITY ASSURANCE
I WANT TO TALK TODAY SPECIFICALLY ABOUT A COUPLE OF POINTS, THE EFFORTS THAT DELTAS PUT TOGETHER FOR CLIMATE IMPROVEMENTS, CARBON NEUTRAL ACTIVITIES YOU CAN EVENT TO SLIDE, BY THE WAY, AS WELL AS WHAT WE'RE LOOKING AT ON THE WASHINGTON FRONT IN THE STATE OF WASHINGTON FRONT IN TERMS OF POTENTIAL PROJECT THAT WE ARE LOOKING AT WITH NORTHWEST ADVANCED BIOFUELS
SO AGAIN, GOOD MORNING TO EVERYONE
I'LL TRY TO STAY WITHIN MY 10 MINUTE TIME FRAME AND I'LL BE WATCHING A CLOCK AS IT COMES OUT
SO FIRST OF ALL, SUSTAINABILITY IS A CORE OF DELTA
WE'VE BEEN WORKING FOR A DECADE OR MORE NOW, WORKING AT LOOKING AT OUR MISSIONS CLOSELY TO DIFFERENT INNOVATIONS, DIFFERENT EFFICIENCY IMPROVEMENTS, THINGS OF THAT NATURE
WE WOULD WANT THE ONLY GLOBAL AIRLINE TO VOLUNTEER CAP OUR MISSIONS AT THE 2012 LEVELS
WE'VE BEEN DOING IT EVERY SINCE JUST A YEAR AGO
WE LOOKED AT A NEW CARBON STRATEGY THAT WE WANT TO DO
WE WANT TO BECOME CARBON NEUTRAL
FROM MARCH 2020 ONWARDS, WE WERE COMMITTED TO INVESTING A BILLION DOLLARS OVER THE NEXT DECADE TO DO THAT, THE KEY PILLARS THAT WE'RE LOOKING AT
OBVIOUSLY, ONE IS CARBON REDUCTION
YOU GUYS HAVE HEARD A LOT ABOUT THAT, BUT THAT'S IN TELLING FLEET OPERATIONS IMPROVEMENT, CHANGING UP WITH OUR FLEET MODERNIZATION OF THE FLEET TO IMPROVE THE EFFICIENCY GAINS ON THE AIRCRAFT ITSELF
WE'VE HAD A FEW ANNOUNCEMENTS AROUND THAT THE LATEST BEING THE A THRU 21 NEODES, WHICH IS ABOUT 12% IMPROVEMENT ON EFFICIENCY PER SE
WE ALSO LOOKED AT, OBVIOUSLY THINGS LIKE THE OPERATIONAL ENHANCING OF HOW WE TRAVEL THERE, PUTTING THE RIGHT AIRCRAFT IN THE RIGHT ROUTE ADDITIONALLY
SO AS PART OF THAT STRATEGY AS WELL, WHICH WE'LL GET TO IN A MINUTE
AND ALSO WE TALKED A LITTLE BIT ABOUT IT
BUT APU BURN HAS BEEN A KEY FOCUS ON OUR RADAR SCREEN FOR YEARS
WE'VE ALSO HAD A ROAD SHOW IN 2019, INCLUDING INTO SEATTLE, LOOKING AT AREAS WHERE WE CAN PROVE THE APU BURN WORKING WITH THE SEATTLE PARTNERS AND STEPHANIE AND COMPANY IN TERMS OF TRYING TO REDUCE THAT OUTPUT THERE
SO THE OTHER THING THAT WE'RE LOOKING AT IS CARBON REMOVAL, WHICH ENTAILS PROJECT OUTSIDE OF OUR OWN, OUR OWN CARBON QUEST THAT CAN BE DIRECT AIR CAPTURE, CARBONCY, QUESTION STORAGE, FORESTRY, RESTORATION, THINGS OF THAT NATURE TO GO BEYOND JUST WHAT WE'RE LOOKING AT FROM OUR OWN CARBON FOOTPRINT
A STAKEHOLDER ENGAGEMENT
EXCUSE ME, KEITH, WE'VE BEEN USING THE TERM APU THROUGHOUT THIS PRESENTATION
COULD YOU JUST QUICKLY LET OUR LISTENING PUBLIC UNDERSTAND WHAT THE ACRONYM MEANS? ABSOLUTELY
SO APU, THE AUXILIARY POWER UNIT IS A UNIT ON THE AIRCRAFT THAT WE CAN UTILIZE, AND IT CONSUMES JET FUEL TO KEEP THE AIRCRAFT CLIMATE COOL
BUT THERE'S ALSO ALTERNATIVE ROUTE THAT WE PREFER
BUT BASICALLY, WHEN YOU USE THE APU, YOU'RE BURNING A LITTLE BIT OF A JET
WE TRY TO AVOID THAT BECAUSE THAT'S AGAIN, TAIL PIPE CONDITIONS THAT WE TRY TO REDUCE OUR CARBON
IT IS A GOOD WAY OF REDUCING THE AMOUNT OF FUEL THAT YOU'RE CONSUMING IN YOUR FLIGHTS AND OVER THE YEARS
AND THAT REDUCTION ALSO AGAIN AFFECTS YOUR CARBON FOOTPRINT
SO THAT'S WHEN WE SAY APU, THAT'S WHAT WE'RE TALKING ABOUT
AND THE FACT THAT YOU CAN PLUG IN AT SEATAC ALLOWS YOU TO AVOID THAT NEED, RIGHT? ABSOLUTELY
THAT'S THE AUXILLARY ANCILLARY EFFORTS THAT WE'RE TRYING TO DO TO AVOID TAPU BURN
CORRECT
STAKE ON ENGAGEMENT
THERE'S ANOTHER AREA THAT WE'RE LOOKING AT HIGHLY FOCUS ON BECAUSE OUR CORPORATE CLIENTS ARE LOOKING AT WAYS THAT IT CAN REDUCE THE CARBON FOOTPRINT THROUGH TRAVEL
WE HAVE ENGAGED SEVERAL OF THOSE COMPANIES, NIKE COMES TO MIND THE LORD IS ANOTHER COMPANY THAT'S COME TO MIND THAT WE'VE HAD PUBLIC ANNOUNCEMENTS AROUND THAT WE LOOK TO ENGAGE TO INCREASE SOUTH INVESTMENT, WHICH IS KEY
AS STEPHANIE MENTIONED EARLIER, THE SAF PRODUCTION LEVELS IS 5,000,000 AROUND
THAT 5,000,000 GALLONS PER YEAR RANGE OR WIDE FOR US
FOR DELTA, YOU'RE LOOKING AT ROUGHLY ON TODAY'S TRAVEL FUEL CONSUMPTION, ABOUT ONE DAY OF DAILY TRAVEL CONSUMPTION FOR US, AND THAT'S ALL OF THE SOUTH THAT'S GOING GLOBALLY
SO I SAY THAT TO SAY THAT SOUTH HAS A WAYS TO GO, AND WE'RE LOOKING TO PUT OUR STAMP ON IT, MOVE THE DIRECTION
AND I THINK STAKEHOLDER ENGAGEMENT, INVESTMENTS AND TECHNOLOGY, THINGS OF THAT NATURE, WHICH WE'RE WORKING ON WITH OUR INVESTMENT AND WITH OUR PARTNERS, WILL GO A LONG WAY TO INCREASE THE AVAILABILITY OF SAF IN THE INDUSTRY
I LIKE TO SAY IF YOU LOOKED AT RYAN SIDE AND SLIDE, OUR EFFORTS HAVE NOT GONE UNRECOGNIZED
YOU CAN SEE THE BALL
ONE SUSTAINABLE INDEX
WE'VE BEEN A PART OF THAT FOR 10 YEARS
THE ONLY AIRLINE IN THAT INDEX, SP SP GLOBAL, THE SAME YEARBOOK MEMBER AS WELL AS THE PUT FOR GOOD SIX YEARS IN THAT RANGE
SO WE ARE BEING RECOGNIZED FOR OUR EFFORTS
WE WILL CONTINUE TO STRIVE TO IMPROVE EACH AND EVERY YEAR AS WE MANEUVER THROUGH THIS DECADE WITH THE 1,000,000,000 DOLLAR INVESTMENT WE MENTIONED EARLIER
NEXT SLIDE
SO HERE'S SOME HIGHLIGHTS OF WHAT WE'VE DONE
I'LL JUST PICK A FEW OF THEM FOR THE INTEREST OF TIME AGAIN, SAVING 33,000,000 GALLONS OF FUEL IN 2019 ALONE
THAT GOES BACK TO THE EFFICIENCY GAINS TO FLEET CHANGING THE OPERATIONAL NATURE THAT WE TALK ABOUT IN THE APU BURN BEHAVIOR WISE
HOW DO WE MANAGE THAT? AND HOW DO WE IMPLEMENT STRATEGIES THAT WOULD IMPROVE AND REDUCE OUR OVERALL CONSUMPTION OF FUEL AS WELL AS IMPROVING THE EFFICIENCY OF OUR FLEET? WE'VE DONE A NUMBER OF RETIREMENTS
WE ACCELERATE RETIREMENTS OF AIRCRAFT IN 2020 AS A RESULT OF THE PANDEMIC
BUT WE'RE STILL THAT WAS A LONG RANGING PLAN THAT JUST GOT ACCELERATED AT THAT TIME
AND WE CONTINUE TO LOOK AT WAYS THAT WE CAN IMPROVE OUR EFFICIENCY AS WELL AS TO FLEET MANAGEMENT, TO OPERATIONAL TO STRATEGY DEVELOPMENT, THINGS OF THAT NATURE
THE OTHER THINGS ARE 10,000,000 GALLONS THAT WE'RE LOOKING AT FROM A SOUTH PERSPECTIVE
WE HAVE ENGAGED GIVO FOR RENEWABLE BIOFUELS AT THEIR FACILITIES THAT THEY ARE LOOKING TO ENGAGE
IT 2,000,000 GALLONS OF MORE FACILITY
WE HAVE SIGNED AN OFF TAKE AGREEMENT WITH THEM, WORKING WITH THEM TO PRODUCE THAT AROUND THE 2023 TO 2024 TIME FRAME
IN ADDITION TO THAT, WHEN WE'RE TALKING ABOUT SAF, WE'VE INVESTED 2,000,000 DOLLARS IN A STUDY WITH NORTHWEST ADVANCED BIOFUELS PRODUCE FUEL FROM FOREST BREED
THIS WOULD ALL BE BASED OFF SEATAC FROM THE NORTHWEST OF PACIFIC NORTHWEST AREA ARE IN AND AROUND THE STATE OF WASHINGTON, STATE OF OREGON, AND SO FORTH
WE'RE LOOKING FOR A PRODUCTION FACILITY THAT WOULD ACTUALLY BE IN THE STATE OF WASHINGTON
SO WE'RE LOOKING FOR TO PUT A STAMP OF ACTUAL SAF PRODUCTION IN THE STATE
THIS IS A VERY EXCITING PROJECT
I'M ACTUALLY A PROJECT LEAD FOR DELTA ON THIS
AND SO I'M WORKING CLOSELY WITH THE NORTHWEST ADVANCED BIEOFUELS TEAM TO ADVANCE THAT EFFORT
THE OTHER THING THAT WE'RE LOOKING AT OBVIOUSLY NEAR TIME, WE HAVE THE ABILITY TO HAVE CARBON OFFSETS THAT WE'VE BEEN WORKING ON
AS I MENTIONED BEFORE, WE'RE THE ONLY AIRLINE THAT HAVE CAPPED OUR MISSIONS TO 2012 LEVELS, AND WE USE CARBON OFFSETS AND EFFICIENCY GAINS TO DO THAT
THAT STILL WILL BE A PART OF THE PORTFOLIO AT THIS TIME AS A NEAR TERM FIX OUR SOLUTION
BUT THE LONGER TERM, MEDIUM TERM, LONGER TERM, OBVIOUSLY, SAF DEVELOPMENT IMPROVEMENT AND THE ADVANCED TECHNOLOGIES TO REDUCE OUR CARBON TO A CARBON MUTUAL PERSPECTIVE
NEXT SLIDE
SO HERE'S A LITTLE BIT MORE ABOUT SAF
AS I MENTIONED BEFORE, WE'RE CHANGING OUR FLEET, LOOKING AT NEW WAYS TO MODERNIZE OUR FLEET WITH THE NEW AIRCRAFT TO COME ONLINE
AS WE DO THAT, WE'RE ALSO LOOKING AT OUR FIRST DELIVERY FLIGHTS
HOW DO WE MANAGE THAT SO THAT WE HAVE A CARBON MUTUAL OUTPUT
WE'VE WORKED WITH AIRBUS AND AIRBP ON SEVERAL DELIVERIES, ACTUALLY UTILIZING SAF AS PART OF THAT AND CARBON OFFSETS TO DELIVER TO THEIR DESTINATION FOR THEM TO ACTUALLY PUT THEM INTO DEPLETE MOBILITY OF DELTA
AND SO WE'VE BEEN WORKING WITH THOSE GUYS OVER THE LAST FEW YEARS IN DOING SO
AGAIN, THE BIOREFINERY
WHAT WE'RE LOOKING AT SUSTAINABLE BIO FINDER IN THE STATE OF WASHINGTON FEESTOCK IS THE WOOD RESIDUE THAT I MENTIONED EARLIER FROM FORESTS THAT WE'RE TRYING TO ELIMINATE FROM A FOREST MANAGEMENT, ANY POTENTIAL FIRE THAT IT MAY CAUSE
SO IT'S A GOOD THING FROM THAT PERSPECTIVE, OUR EXPECTATIONS OF AVAILABILITY, THAT FUEL ON EARLY 2025 AND THE REGION THAT WE'RE LOOKING AT ARE OBVIOUSLY THE STATE OF WASHINGTON, SEATTLE
WE'RE ALSO LOOKING AT PORTLAND, SAN FRANCISCO AND LAX AS OTHER OPPORTUNITIES AS WELL
NEXT SLIDE, PLEASE
SO HERE'S MY LAST SLIDE
I WANT TO GET A LITTLE BIT MORE ABOUT THE PROJECT ITSELF
WHERE WE ARE TODAY IS WE'RE IN THE FEED STUDY PHASE THAT WE'RE LOOKING AT DEVELOPING THE DESIGN BASIS FOR THE PROJECT
WHAT WILL IT ENTAIL IN TERMS OF OPERATIONS? WE DO KNOW FROM THE PROJECT ITSELF, THE CHEMICAL OPERATIONS THAT ARE UNTIL ARE VERY TRADITIONAL
THEY'RE NOT SOMETHING NEW
THEY'RE VERY WELL TUNED IN INDUSTRY AND WELL KNOWN IN INDUSTRY
AND SO WHAT WE'RE LOOKING AT IS MARRYING THOSE DIFFERENT TECHNOLOGIES TOGETHER TO TAKE THE FEEDSTOCK, THE WOODY BIOMASS RESIDUE AND PRODUCING A CLEAN, SAF PRODUCT AND PRODUCTION CAPABILITIES ABOUT 60,000,000 GALLONS PER YEAR OVER A 10 YEAR PERIOD
THAT'S ABOUT 600,000,000 DOLLARS OF PRODUCT THAT WE WOULD SEE IN THAT WEST COAST REGION
I'D LIKE TO SAY FROM A STANDPOINT OF WHERE WE ARE TODAY AND LOOKING AT THE TIMELINE, NORTHWEST ADVANCED BIOFUELS HAVE BEEN WORKING VERY HARD AND VERY DILIGENTLY ON MOVING THIS PROJECT ALONG
AGAIN, WE ARE IN THE STUDY PHASE, SO WE GOT A LOT OF WORK TO DO
AND IF YOU CAN LOOK AT THE TIMELINE, WE EXPECT THAT FRONT ENGINEERING DESIGN TO BE DONE WITHIN ABOUT 10 TO 15 MONTHS
WE HOPE TO GET THAT CASCADED AND STARTED THIS YEAR
BUT ONCE WE HAVE THAT VIEW OF THE PROJECT ITSELF AND ITS FEASIBILITY, WE WILL BE LOOKING AT THE FINAL FUNDING REQUIREMENTS TO DO THAT
SO REALLY, THIS IS THE KEY STEP
THE KEY STEP IS THE KEY STEP AND DETERMINE THE PROJECT FEASIBILITY AND MOVING FORWARD
ONCE WE HAVE THAT AVAILABLE AND UNDERSTOOD
OBVIOUSLY, FUNDING WOULD BE NEXT TO GO INTO A FULL FLEDGED PROJECT IF WE ARE SUCCESSFUL, WHICH IS WHAT WE'RE WORKING ON TODAY PROJECT CONSTRUCTION
WE ESTIMATED SOMETIME IN 2022 WITH FULL PRODUCTION AGAIN AROUND 2025 TIME FRAME
WE ARE ENGAGED WITH NORTHWEST ADVANCED BIO HEAVILY ON THIS
THEY HAVE GREAT TEAM DYNAMICS THAT THEY'RE WORKING WITH INTERNALLY AS WELL AS EXTERNAL PARTNERS LIKE BLACK AND BEACH WHO ARE WELL RENOWNED ENGINEERING GROUP THAT'S GOING TO DO THE FRONT AND ENGINEERING STUDY
THEY HAVE AN LI IN PLACE AS WELL AS FROM THE FEED STOCK PERSPECTIVE, WHICH IS KEY AS WELL, LIS, ARE IN PLACE ON THAT PERSPECTIVE
IN ESSENCE OF THE OF THE PROJECT ANNUAL FEED STOCK REQUIREMENTS
THE FEED STOCK IS THERE
IT IS AVAILABLE
WE'RE LOOKING AT THE FEED STUDY TO DETERMINE THE NEXT STEPS IN TERMS OF PROJECT AVAILABILITY
FROM THERE, ASSUMING THE STUDY IS SUCCESSFUL, WE'RE VERY OPTIMISTIC HE WILL BE WE WILL MOVE INTO FUNDING AS WELL AS POTENTIAL CONSTRUCTION FOR THE PROJECT
AND AGAIN, ALL OF THIS WILL BE IN THE STATE OF WASHINGTON IS WHAT WE ARE ASSUMING AT THIS POINT IN TIME
THAT IS THAT CONCLUDES MY PRESENTATION
AGAIN, THANK YOU, COMMISSION AND COMMISSIONER FELLEMAN FOR YOUR TIME
AND I'M OPEN TO QUESTIONS
REALLY FANTASTIC AND EXCITING NEWS
KEITH, I'M DELIGHTED TO SEE THAT YOU'RE LOOKING AT WASHINGTON EXPANDING THESE FACILITIES THAT WE HAVE AS WELL
AND I'M JUST WONDERING WHETHER WE CAN GET THOSE CO BENEFIT TAX CREDITS FOR FIRE RETARDATION AND JOBS IN THE WOODS
IT'S ABOUT I'D LIKE TO HAVE OUR COLLEAGUES ON THE COMMISSION TO TAKE A MOMENT HERE TO SEE IF WE HAVE ANY QUESTIONS
AND CLERK, PLEASE CALL THE ROLL
THANK YOU
BEGINNING WITH COMMISSIONER BOWMAN, CAN YOU HEAR ME NOW? WE CAN YES
EXCELLENT
FANTASTIC
WE'RE GOING TO GET TO SAF AND GET TEAMS WORKING AT SOME POINT
IT'S MORE OF CONSISTENTLY
THANK YOU FOR YOUR PRESENTATION
BOTH, KEITH, AND ALSO APPRECIATE ALASKA AIRLINES
IT SOUNDS LIKE YOU'RE DOING A LOT OF SIMILAR THINGS AND REALLY LOOK FORWARD TO I THINK COMMISSIONER CALKINS BROUGHT IT UP AND WE NEGOTIATE THE NEXT SLOA REALLY INCREASE OUR OPPORTUNITIES TO BRING SAF TO SEATAC
MY SPECIFIC QUESTION WAS REALLY DO START TO TOUCH ON IT, KEITH, ABOUT WHAT DO YOU SEE THAT WE CAN DO? SEATAC AIRPORT, THE PORT OF SEATTLE IN THE STATE OF WASHINGTON TO INCENTIVIZE THE PRODUCTION IN WASHINGTON STATE, BECAUSE WITH ALL DUE RESPECT TO THE NEST IMPORTS, THAT FOR ME, IT SORT OF NEGATES THE OPPORTUNITY AROUND REDUCING YOUR CARBON FOOTPRINT WHEN YOU'RE HAVING TO SHIP IN BIOFUELS
SO YOU TALKED A LITTLE BIT ABOUT IT, KEITH, BUT CAN YOU TALK ABOUT ANYTHING WITH THE STATE OF WASHINGTON OR WHAT YOU SEE THE PORT OF SEATTLE COULD DO TO HELP BE MORE OF A PARTNER IN INCENTIVIZING THE PRODUCTION IN WASHINGTON STATE? SURE
ABSOLUTELY
AND THANK YOU FOR THE QUESTION
I WANT TO SAY FIRST AND FOREMOST, BECAUSE I MISSED THIS POINT EARLIER
STEPHANIE BROUGHT UP WITH THE PASSAGE OF THE LCLS IN THE STATE OF WASHINGTON, PARTICULARLY WITH THE OPT IN AVAILABILITY FOR JET FUEL
THAT IS CERTAINLY HELP IN TERMS OF INCENTIVES FOR THE STATE
I DO UNDERSTAND THAT THERE IS SOME SOME TANGIBLES RELATED TO THE TRANSPORTATION BILL THAT GOES ALONG WITH THAT
OUR GOVERNMENT AFFAIRS TEAM WILL BE WATCHING THAT PIECE, BUT THAT CERTAINLY IS ONE INCENTIVE THAT WE SEE THAT DEFINITELY HELPS IN STATE OF WASHINGTON OTHER PROTOCOLS, AND WE CAN DEFINITELY DO I KNOW, FOR AN INTEREST OF TIME, WE CAN GO ANY MORE DETAIL LATER, BUT THE COMMISSION OBVIOUSLY, WE'RE OPEN TO THAT WITH OUR GOVERNMENT AFFAIRS PEOPLE
BUT I'M THINKING THAT SOME OF THE THINGS THAT WE'RE LOOKING AT FROM OUR PROJECT ITSELF, WHAT WE'RE CONTEMPLATING IS A 60,000,000 GALLONS OF MEAT PRODUCT, WHICH MEANS IT'S UNBLENDED WITH THAT
IN ESSENCE, WE WOULD LOOK FOR TAKING THAT PRODUCT INTO THE AIRPORT AS A BLENDING MATERIAL, AND IN OUR CASE SPECIFICALLY, THIS PRODUCT IS HAVE THE ABILITY TO BLEND WITH CONVENTIONAL JET FUEL UP TO 50% LEVEL
THAT IS AN ASTM REQUIREMENT BEFORE IT CAN BE USED IN COMMERCIAL AVIATION
THAT VARIES BETWEEN BETWEEN THE DIFFERENT PATHWAYS
BUT CERTAINLY FOR THE PATHWAY, THE WOODY BIOMASS THAT WE CAN CONTEMPLATE IS UP TO 50%
SO WHAT WE WILL LOOK FOR THAT MIGHT BE HELPFUL IS INFRASTRUCTURE NEEDS AROUND TANK BLENDING OPERATIONS OUTSIDE OF THE AIRPORTS
THAT CERTAINLY COULD MOVE THE PRODUCT INTO SEATAC BECAUSE SEATAC'S CURRENTLY THE PIPELINE FED FACILITY
BUT THAT PRODUCT HAS TO BE BLENDED BEFORE IT CAN BE MOVED IN AN APPRECIABLE WAY
SO THOSE TYPES OF INCENTIVES INFRASTRUCTURE, I THINK, WOULD BE PRIMARY TARGETS ALONG WITH THE OTHER BUSINESS INFRASTRUCTURE, TAXES, CITIES THAT I'M SURE NORTHWEST ADVANCE BIOFUELS WILL HAVE MORE DETAILS ON YOU
THANK YOU
THANK YOU
MOVING TO COMMISSIONER CALKINS FOR QUESTIONS
ALRIGHT, QUICK ONE
AND KEITH, I'LL PUT YOU ON THE SPOT
THANK YOU FOR THE PRESENTATION
BUT AS YOU MAY HAVE HEARD EARLIER, UP UNTIL SUNDAY, THE PORT OF SEATTLE NUMBER ONE LEGISLATIVE PRIORITY WAS PASSING A LOW CARBON FUEL STANDARD
NOW THAT WE'VE SEEN SUCCESS THERE, WHAT WOULD YOU SUGGEST IN TERMS OF THE REGULATORY ENVIRONMENT GOVERNMENT SUPPORTS? WHAT DO YOU THINK THE NUMBER ONE LEGISLATIVE PRIORITY OUT TO BE FOR THE PORT OF SEATTLE, EITHER AT THE STATE OR FEDERAL LEVEL? THAT'S A GOOD QUESTION
I WILL HAVE TO DEFER THAT TO MY GOVERNMENT AFFAIRS TEAM
THEY HAVE THE INS AND OUTS OF THAT
THAT'S JUST NOT IN MY WHEEL HOUSE
I'M MORE ON A FUEL RELATED TRYING TO GET THE FUEL TO THE AIRPORT
SO THAT'S CERTAINLY A QUESTION I CAN TAKE BACK TO THE GOVERNMENT AFFAIRS TEAM AND LET THEM PROVIDE A RESPONSE OR FEEDBACK
THANK YOU, KEITH
THANK YOU
COMMISSIONER CALKINS, COMMISSIONER CHO
I HAD A SIMILAR QUESTION TO RYAN
SO I'LL LOOK FORWARD TO THE RESPONSE TO A QUESTION
THANK YOU
THANK YOU, MR STEINBRUECK, TWO QUESTIONS, 1 RELATED TO THE PREVIOUS QUESTION REGARDING THE LCFS LEGISLATION JUST PASSED
I'D LIKE TO HEAR FROM YOU, KEITH, ON WHAT YOU THINK IT'S VALUE AND WHAT PURPOSE IT WILL SERVE AND HOW MUCH DOES IT FIGURE IN TO YOUR FUTURE PLANNING AND STRATEGIES? SECOND QUESTION, WHY DID YOU CHOOSE THE BIOMASS OVER MUNICIPAL WASTE FOR YOUR WASHINGTON STATE PROJECT? THANK YOU
SO SOME QUESTIONS
I'LL START WITH THE SECOND ONE
FIRST, THE BIOMASS WOODY WAGE WAS A PROJECT, A PROCESS THAT STARTED WITH NORTHWEST ADVANCED BIOFUELS, BASED ON THE STUDIES THAT WE'RE DOING IN WASHINGTON BEFORE THE NORA HAD SOME STUDIES OUT TO WASHINGTON STATE UNIVERSITY, ALSO COLLABORATE ON SOME STUDIES
SO THAT WASN'T OF NORTHWEST ADVANCED BIOFUELS ROLl IN PROCESS BASED ON TECHNOLOGY THAT THEY WERE LOOKING AT WITH THE DIFFERENT WELL KNOWN TECHNOLOGIES LIKE FISSURETROPES AND GASIFICATION
THAT WAS A GOOD FIT FOR THE PROCESS
SO THAT WAS THE PURPOSE AND REASON REALLY WAS AROUND
NORTHWEST, ADVANCED BIOFUELS PUTTING THAT TOGETHER, WE TOOK A LOOK AT IT
WE'D LIKE THE OPPORTUNITY AND WE WANT TO ENGAGE A LITTLE FURTHER TO GET AN UNDERSTANDING OF IT
SECONDLY, I THINK A QUESTION WAS AROUND THE LCFS
AGAIN, FROM OUR PERSPECTIVE, THE INCENTIVE THERE DOES HELP
AS MENTIONED BEFORE, I THINK BY ONE OF THE MAYBE STEPHANIE OR MAYBE ALASKA
I CAN'T REMEMBER WE BOUGHT FUEL TRADITIONALLY FROM A NUMBER OF DIFFERENT MARKETS
SAF IS NO DIFFERENT FROM THAT
SO THE ECONOMICS PLAY REALLY HEAVILY INTO THE DECISIONS AS WELL AS OPERATIONAL AS WELL AS APPLY CONSTRAINTS WITHIN AIRPORTS AND THINGS OF THAT NATURE AND LOGISTICS, TOO
SO FROM AN ECONOMIC PERSPECTIVE, THAT WAS ENHANCES THE SITUATION VERSUS HAVING INCENTIVES SIMILAR IN OTHER STATES
SO THAT DEFINITELY HELPS WE HAVE TO SEE HOW MUCH WHEN THAT INCENTIVE BECOMES MORE FLESHED OUT IN TERMS OF DEVELOPING A MODEL AND MARKET DONE AND ITS MARKET CONSTRAINTS
OKAY, GREAT
THANKS VERY MUCH
THANK YOU, COMMISSIONER FELLEMAN
THANKS AGAIN, KEITH
AND THAT WAS REALLY ENCOURAGING TO HEAR THAT WE'RE MAKING PROGRESS HERE IN WASHINGTON
IT'S NOW TIME TO HEAR FROM TOM MICHAEL, GOVERNMENT RELATIONS SENIOR MANAGER WITH UNITED AIRLINES
I REALLY APPRECIATE YOU COMING IN TO BE ABLE TO MAKE YOUR RECENT ANNOUNCEMENTS WITH US AND A SHORT NOTICE AND LET US KNOW WHEN YOU'RE READY TO DISPLAY THE PRESENTATION, AND THE CLERK WILL ADVANCE THE SLIDES WHEN YOU SIGNAL
TOM, YOU'VE GOT THE FLOOR
THANKS VERY MUCH
YOU CAN OPEN UP THE SLIDES NOW THAT YOU'D LIKE TO DO IT
AND WITH APOLOGIES IN ADVANCE, I'M PROBABLY GOING TO SKIP AROUND A LITTLE BIT ON THIS
I WANT TO KEEP IT AS MEATY AS POSSIBLE
AGAIN, MY NAME IS TOM MICHAEL
I'M THE DIRECTOR OF GOVERNMENT AFFAIRS WITH UNITED AIRLINES
JUST TO GIVE YOU A WORD ABOUT MY BACKGROUND, I'M BASED IN WASHINGTON, DC
I'M PRIMARILY FEDERALLY FOCUSED
I'VE SPENT THE LAST 20 YEARS IN THE ENERGY AND ENVIRONMENTAL SPACE SO I CAN GET REAL DEEP ON FUELS, GET REAL DEEP ON FEDERAL POLICY
I PROBABLY CAN'T GET VERY DEEP AT ALL ON WASHINGTON STATE SPECIFIC ISSUES, ALTHOUGH I DO KNOW A LITTLE BIT ABOUT SOME OF THE LOGISTICS ISSUES IN THAT SPACE
IF WE CAN GO TO THE NEXT SLIDE, I'M GOING TO JUST SPEND A MINUTE HERE GOING THROUGH SOME OF THE THINGS THAT UNITED IS INTERESTED IN
WHILE, MANY COMPANIES HAVE PLEDGED TO ACHIEVE CARBON NEUTRALITY BY 2040 OR 2050
UNITED IS THE ONLY AIRLINE TO HAVE COMMITTED TO DOING SO WITHOUT RELYING ON TRADITIONAL VOLUNTARY CARBON OFFSETS
OUR STRATEGY IS TO REVOLUTIONIZE OUR BUSINESS AND TRY TO ATTACK OUR EMISSIONS DIRECTLY
AND WE'RE DOING THAT BY MAKING EARLY STAGE INVESTMENTS INTO INNOVATIVE TECHNOLOGY THAT CAN REDUCE CARBON EMISSIONS
WHILE ALSO IMPROVING THE CUSTOMER EXPERIENCE AND HOPEFULLY EARNING A STRONG FINANCIAL RETURN
TO THAT END, UNITED WAS AN EARLY STAGE INVESTOR IN FULCRUM BIOENERGY
THEY'RE THE PIONEERS IN LOW CARBON FUELS WHO ARE BUILDING A PLANT IN NEVADA THAT STEPHANIE MENTIONED EARLY ON
WE HAVE A 30,000,000 DOLLAR EQUITY STAKE IN FULCRUM
WE ARE ALSO ONE OF THE BIGGEST OFFTAKERS OF WORLD ENERGY WHO HAS GOT THEIR BIOREFINERY IN PARAMOUNT, CALIFORNIA, ADJACENT TO LAX
AND WE ARE ALSO BRANCHING OUT INTO OTHER SPACES, TOO
A KEY PIECE OF OUR STRATEGY IS CARBON CAPTURE, AND WE HAVE A MULTIMILLION DOLLAR EQUITY STAKE IN THE 1 5 PROJECT THEY ARE BUILDING
THAT'S A JOINT VENTURE WITH OXY AND CARBON ENGINEERING THAT IS BUILDING THE LARGEST DIRECT AIR CAPTURE FACILITY IN THE WORLD IN SOUTH TEXAS
RIGHT NOW, AIR CAPTURE ACTUALLY SUCKS CARBON DIOXIDE FROM THE AIR AND INJECTS IT DEEP UNDERGROUND IN THE SALINE AQUIFERS AND YOU CAN THINK OF IT THIS WAY
IT'S BASICALLY POST COMBUSTION CAPTURE FOR AVIATION
WE CAN PUT SCRUBBERS ON THE END OF OUR JET TURBINES THERE, BUT WE CAN TAKE THE CARBON OUT OF THE GROUND
AND SO DOING THAT, AND INVESTING IN THE DIRECT AIR CAPTURE IS A KEY PIECE OF OUR CARBON REMOVAL STRATEGY
ANOTHER INTERESTING INVESTMENT WE ANNOUNCED RECENTLY IS INTO ARCHER AVIATION
THEY ARE A LEADER IN CARBON FREE ELECTRIC SHORT HAUL FLIGHT
THESE ARE BASICALLY AIR TAXIES THAT WOULD GET YOU FROM YOUR HOUSE TO THE AIRPORT
SO IT'S NOT REALLY GOING INTO COMPETITION WITH OUR REGIONAL OR LONG HAUL BUSINESS
AND WE DON'T REALLY SEE ELECTRIC AIRCRAFT PLAYING A ROLE IN THAT IN THE FORESEEABLE FUTURE
BUT WE DO THINK THAT THESE SMALLER SHORT HOP AIRCRAFT HAVE A REAL FUTURE
AND WE'VE GOT ABOUT 300 NEW AIRCRAFT ON ORDER WITH ARCHER AVIATION
AND THAT COULD HAVE A BIG DIFFERENCE ON ALL SORTS OF THINGS FROM THE LOCAL AIR QUALITY AND A LOT OF THE CONGESTED CITIES WHERE WE OPERATE OUR HUBS, AS WELL AS TRAFFIC MINIMIZATION
SO WE THINK THERE THERE'S A LOT OF PROMISE THERE
JUST TWO WEEKS AGO, THOUGH, WE HAD A BIG ANNOUNCEMENT IN SUSTAINABLE AVIATION FUELS OR ANOTHER BIG ANNOUNCEMENT, WE LAUNCHED OUR ECO SKIES ALLIANCE
AND WE BELIEVE THE ECO SKIES ALLIANCE IS THE MOST IMPACTFUL MULTI COMPANY EFFORT TO DECARBONIZE AVIATION OF ITS KIND TO DATE
MORE THAN A DOZEN COMPANIES JOIN ECO SKIES ALLIANCE, AND WHAT THEY HAVE AGREED TO DO AS A MEMBER OF THE ECO SKIES ALLIANCE IS TO PAY THE GREEN PREMIUM ASSOCIATED WITH OUR USAGE OF SUSTAINABLE AVIATION FUELS ON THEIR FLIGHTS
SO THIS IS THE DELTA BETWEEN CONVENTIONAL JET FUEL AND SAF, WHICH HAS STEPHANIE MENTIONED CAN BE QUITE SIGNIFICANT
AND COVERING THAT DELTA IS A BIG IMPEDIMENT TO US BEING ABLE TO USE IT
AND THESE COMPANIES, SOME OF OUR LARGEST CORPORATE CUSTOMERS, STEPPED UP TO HELP US FINANCE THE COST OF USING SAF AND THOSE FLIGHTS
AND IN EXCHANGE, THOSE COMPANIES ARE ABLE TO REDUCE THE CARBON FOOTPRINT ASSOCIATED WITH THEIR CORPORATE TRAVEL
THE INAUGURAL PARTICIPANTS OF THE ECO SKIES ALLIANCE HAVE COMMITTED TO FUND ENOUGH SAF USAGE ON UNITED FLIGHTS OVER THE NEXT YEAR TO ELIMINATE APPROXIMATELY 31,000 METRIC TONS OF GREENHOUSE GASES
THAT EQUATES TO ABOUT 3.4 MILLION GALLONS OF SAF
AND PUT ANOTHER WAY, THAT'S ENOUGH SAF TO FLY PASSENGERS OVER 220,000,000 MILES
IT SOUNDS LIKE A LOT, AND IT IS A LOT RELATIVE TO THE OVERALL SCALE OF SAF USAGE
BUT WHEN YOU THINK OF THE FACT THAT THE GLOBAL INDUSTRY IS CONSUMING NORTH OF 20,000,000,000 GALLONS OF JET FUEL A YEAR, YOU REALIZE THAT THESE ARE THESE ARE SMALL INCREMENTS
WE HAVE A LONG, LONG WAY TO GO TO REALLY MAKE A DENT IN THIS
AND ONE OTHER THING, JUST TO PUT THINGS I HEAR FOLKS TALKING ABOUT APU, AND THERE'S LOTS OF STUFF THAT WE'RE INTERESTED IN DOING AROUND OUR OUR CARBON FOOTPRINT FROM ELECTRIFYING OUR GROUND SUPPORT VEHICLES AND EVERYTHING ELSE
BUT SOMETHING TO KEEP IN MIND IS THAT FOR UNITED, 99% OF OUR CARBON FOOTPRINT IS OUR JET FUEL CONSUMPTION
99% EVERYTHING ELSE
ALL THE EQUIPMENT YOU SEE ON THE GROUND, YOU'RE AT THE AIRPORT, THERE'S FUNNY LITTLE TUBS DRIVING AROUND
AND ALL THE PEOPLE THAT ARE 20,000 EMPLOYEES IN THE WILLIS TOWER IN CHICAGO ARE 15,000 EMPLOYEES IN CALIFORNIA
ALL OF THOSE EMISSIONS ASSOCIATED WITH HOUSING AND THOSE PEOPLE AND TRANSPORTING THEM, MOVING THEM, THAT EQUALS 1% REST IS JET FUEL BURN
SO THAT GIVES YOU A SENSE OF THE IMPORTANCE OF SAF
AND AS STEPHANIE MENTIONED SAF IS REALLY THE RELEASE VALVE
IT IS THE WAY TO REDUCE OUR CARBON EMISSIONS QUICKLY
WE CAN DO IT TODAY
IT DOES TAKE INVESTMENTS
AND RIGHT NOW THERE ARE SOME REAL SIGNIFICANT DELTAS BETWEEN WHERE THE INCENTIVES ARE AROUND ON-ROAD FUELS, SUCH AS RENEWABLE DIESEL VERSUS SAF, WHICH IS PRIMARILY IF YOU HAVE A RENEWABLE DIESEL PLANT, YOU PROBABLY COULD PRODUCE SAF FROM IT TODAY
BUT YOU WOULDN'T DO THAT GENERALLY, UNLESS YOU HAVE OF AN OFF TAKER LIKE UNITED TO BUY THAT FUEL, BECAUSE THE INCENTIVES ARE SUCH THAT IT JUST WOULD BE ECONOMICALLY IRRATIONAL TO DO SO
AND I'M SPENDING ABOUT 90% OF MY TIME IN WASHINGTON WORKING ON THE SAF LENDERS TAX CREDIT IN PARTNERSHIP WITH OUR FRIENDS HERE THAT ARE ON THE CALL
AND ERIC SEINFELD HAS BEEN GREAT TO WORK WITH
WE ARE PUSHING HARD FOR THAT
THE BIDEN ADMINISTRATION HAS ENDORSED THIS SAF SPECIFIC BLENDERS TAX CREDIT, AND IT'S MADE IN AMERICA TAX PLAN
THAT WAS A HUGE, HUGE PLUS ON OUR SIDE OF THE LEDGER
SO I'VE GOT A REAL SENSE OF OPTIMISM ABOUT WHERE THAT'S GOING, AND WE CAN TALK ABOUT THAT A LITTLE BIT LATER IF WE COULD SKIP AHEAD
I THINK IT'S TO SLIDE SEVEN NEXT TO ME RIGHT HERE
I JUST WANT TO FINISH OFF ON THE ECO SKIES ALLIANCE PROGRAM
THIS IS JUST SOME OF THE CUSTOMERS THAT TOOK PART IN THAT
NOT ALL OF THEM
BUT I DON'T WANT TO UNDERSTATE THIS OR UNDERSELL IT
IT'S A BIG DEAL
WE BELIEVE IT'S ONLY THE FIRST STEP
WE EXPECT TO SIGN UP A LOT MORE CUSTOMERS IN THE DAYS AND MONTHS TO COME
WE'RE ALSO HOPEFUL THAT WE COULD BASICALLY GET THE FEDERAL GOVERNMENT TO JOIN IN THE ECO SKIES ALLIANCE
WITH THE BIDEN ADMINISTRATION COMING IN, WE EXPECT TO SEE NEW RULES AND THE SOCIAL COST OF CARBON TO BE ISSUED
AND WE THINK THAT COULD AFFECT THINGS LIKE FEDERAL PROCUREMENT CONTRACTS
UNITED CARRIES A LOT OF MAIL FOR THE US POSTAL SERVICE
WE HAVE CONTRACTS TO CARRY SERVICEMEN WITH THE DEPARTMENT OF DEFENSE
IF YOU BUILD INTO THOSE PROCUREMENT BIDS THE COST OF CARBON, THEN YOU COULD BASICALLY HAVE THE FEDERAL GOVERNMENT HELPING TO FINANCE THE USAGE OF SAF ON THOSE FLIGHTS TO REDUCE THE WRONG CARBON FRONT FOOTPRINT, WHICH IS A BIG PRIORITY FOR THE BIDEN ADMINISTRATION
SO WE'RE REAL HOPEFUL THAT BETWEEN A NEW TAX CREDIT, WHICH WE HOPE WILL BE TAKEN UP IN THE CONTEXT OF THE INFRASTRUCTURE BILL, WITH SOME NEW STRATEGIES FROM THE ADMINISTRATION, THEY COULD TAKE EXECUTIVE ACTION ON AND WITH GREAT STEPS FORWARD AT THE STATE LEVEL IN WASHINGTON STATE, IN CALIFORNIA AND ELSEWHERE THAT WE CAN SEE SOME BIG, BIG CHANGES THAT COULD REALLY START TO SCALE UP SAF WHERE IT NEEDS TO BE
I WANT TO MAKE ONE MORE POINT ABOUT WHAT WE'RE DOING WITH OUR ECO SKIES ALLIANCE AS WELL
THIS IS NOT JUST SOMETHING WITH OUR CORPORATE CUSTOMERS
WE'RE ALSO OFFERING OUR INDIVIDUAL CUSTOMERS THE OPPORTUNITY TO CONTRIBUTE TO THE COST OF STAFF ON THEIR OWN FLIGHTS
WE STILL DO OFFER OUR CUSTOMERS THE OPPORTUNITY TO PURCHASE CARBON OFFSETS THROUGH CONSERVATION INTERNATIONAL
BUT, FRANKLY, WE HAVE A LOT OF SKEPTICISM ABOUT THE USE OF CARBON OFFSETS, ABOUT THEIR INTEGRITY, THEIR VERACITY AND THE MARKET THAT IS GOING TO BE USED TO DO THEM
SO WE REALLY DO PREFER TO DIRECTLY INVEST IN TECHNOLOGY THAT AFFECTS OUR EMISSIONS
AND I WAS SURPRISED, FRANKLY, THAT WE HAVE ALREADY SEEN A PRETTY SIGNIFICANT OUTPOURING FROM INDIVIDUAL CUSTOMERS WHO WANT TO PURCHASE SAF TO HELP PRODUCE THEIR OWN CARBON FOOTPRINT
AND WE ALSO UNITED AND AIRLINES IN GENERAL HAVE THE OPPORTUNITY TO COMMUNICATE WITH OUR CUSTOMERS IN A WAY THAT A FEW COMPANIES CAN
WE'VE GOT THEM ON A PLANE THERE
WE COMMUNICATE WITH THEM AS THEY BUY THEIR TICKET IN ADVANCE, AND THEY TRAVEL IN THE DAY OF SO WE ARE LEVERAGING THAT ABILITY TO TRY AND HELP BUILD POLITICAL SUPPORT FOR BOLD CLIMATE ACTION
AND WE ARE GIVING OUR CUSTOMERS WHEN WE ANNOUNCED THE ECO SKIES ALLIANCE PROGRAM, WE ALSO GAVE OUR CUSTOMERS THE ABILITY TO QUICKLY AND EASILY SEND LETTERS TO THEIR ELECTED OFFICIALS URGING THEM TO SUPPORT BOLD AND MEANINGFUL CLIMATE POLICY SOLUTIONS
AND AGAIN, I WAS SOMEWHAT SURPRISED, FRANKLY, AT THE LEVEL OF ENGAGEMENT THAT WE'VE SEEN JUST IN THE PAST TWO WEEKS
ABOUT 2,000 OF OUR CUSTOMERS HAVE SENT THESE LETTERS TO THEIR ELECTED OFFICIALS AT THE FEDERAL LEVEL AND THEIR GOVERNORS
AND, YOU KNOW, THAT REALLY, WE BELIEVE, DOES HELP TO MAKE A DIFFERENCE
AND HOPEFULLY, AS MORE LEGISLATORS HEAR FROM OUR CUSTOMERS AND HEAR FROM OTHERS, THERE WILL BE A GROUNDSWELL, THIS IS NOT SOMETHING THAT WE CAN SIT IN OUR HANDS ON ANY LONGER
SO I'D LIKE TO TURN THIS INTO A CONVERSATIONAL THING
MORE THAN ANYTHING, I CAN GO THROUGH SOME OF THE OTHER SLIDES IF YOU'RE INTERESTED IN SO DOING
I GUESS MY KEY MESSAGE TO YOU IS THAT UNITED IS INVESTING MILLIONS IN CARBON REDUCTION IN CARBON REMOVAL
AND WITH THIS ANNOUNCEMENT, WE'RE ENLISTING OUR CORPORATE CUSTOMERS IN THAT EFFORT AS WELL, THROUGH THIS INNOVATIVE FINANCING MECHANISM FOR LOW CARBON FUEL DEPLOYMENT
BUT WE WILL NEED STATE AND FEDERAL POLICY SUPPORT TO REALLY SCALE THE INDUSTRY TO WHERE IT NEEDS TO BE IN ORDER TO COMBAT TO CLIMATE CRISIS
WASHINGTON STATE TOOK A HUGE STEP FORWARD, AND I'D LOVE TO TALK ABOUT WAYS THAT WE CAN LEVERAGE THAT
ONE THING I WOULD MENTION TODAY IS THAT ALL SAF THAT IS GOING TO BE SOLD IN THE UNITED STATES TODAY IS GOING TO BE SOLD INTO THE STATE OF CALIFORNIA BECAUSE YOU WOULD BE A FOOL TO SELL IT ANYWHERE ELSE, BECAUSE THE POWER OF THE CALIFORNIA LOW CARBON FUEL STANDARD LAYERED WITH THE RENEWABLE FUEL STANDARDS, THOSE STACKABLE INCENTIVES WOULD MAKE IT YOU WOULD BE SILLY TO SELL IT ANYWHERE ELSE, REALLY
AND SO IF ANY SAF IS GOING TO BE USED IN THE UNITED STATES TODAY, IT'S GOING TO BE USED IN CALIFORNIA WASHINGTON STATE
LCFS, I THINK WILL CHANGE THAT
I HAVE NOT YET HAD THE CHANCE TO GO THROUGH WHAT YOU WERE ABLE TO PASS THIS WEEKEND, BUT I KNOW IT WILL BE A MEANINGFUL STEP IN THE RIGHT DIRECTION, BUT I DON'T EXPECT ALL OF THAT SAF TO BE PRODUCED IN CALIFORNIA
THERE ARE LOTS OF REASONS YOU MIGHT WANT TO PRODUCE YOUR FUEL ELSEWHERE AND USE IT IN CALIFORNIA OR HOPEFULLY SOON USE IT IN WASHINGTON STATE AS WELL
BUT THOSE ARE THOSE ARE SOME OF THE POLICY QUESTIONS
AND AT SOME POINT CALIFORNIA IS GOING TO BASICALLY FILL UP WITH SAF
YOU CAN ONLY USE SO MUCH FROM OUR HUBS IN LOS ANGELES AND SAN FRANCISCO
WE NEED TO HAVE THAT SPREAD AROUND THE COUNTRY
MY HOPE IS THAT THE FEDERAL SAF TAX CREDIT CAN HELP
THAT COUPLED WITH THE TRANSPORTATION COSTS OF MOVING SOUTH TO CALIFORNIA, THERE ARE GOOD REASONS WHY THE PACIFIC NORTHWEST MAKES SENSE TO SITE THE PRODUCTION AND USAGE OF SAF FACILITIES
I THINK WITH THAT, I'LL CONCLUDE MY PRESENTATION AND JUST SAY THANK YOU SO MUCH FOR HAVING US REALLY APPRECIATE IT
THANK YOU, TOM
IT WAS REALLY AN INSPIRATIONAL PRESENTATION, AND WE HAD MET WITH FORMER SECRETARY MAYBE WE DID A FORUM WITH HIM, AND HE REALLY GOT THE DOD EXCITED ABOUT UTILIZING THAT TO CREATE THAT DEMAND
AND I JUST SPOKE WITH CONGRESSMAN LARSON'S OFFICE, WHO HAS THE WEEPY NAVAL AIR STATION THAT WE COULD MAYBE LEVERAGE THAT ONCE AGAIN
AND WE ALSO HAVE A RESPONSIBLE TRAVELER PROGRAM AT SEATAC WHERE PEOPLE CAN MAKE A DONATION TO REDUCE THEIR GREEN CONTRIBUTION
AND IT'S ONE OF THE BEST KEPT SECRETS
I THINK WE CAN REALLY ELEVATE THE PROFILE OF THAT AND SPECIFICALLY USE IT TOWARDS SAF
AND I'M REALLY LOOKING FORWARD TO HAVING THAT CONVERSATION
THE NEXT TWO SPEAKERS, WILL ALSO VERY MUCH EXCITED TO SEE THE CORPORATE I MAKE THESE COMMITMENTS AS WELL
WE ARE RUNNING CURRENTLY EIGHT MINUTES LATE, SO I WOULD LIKE THE CLERK TO ASK MY COLLEAGUES TO PROVIDE SOME QUESTIONS AND TO PLEASE KEEP IT BRIEF
I JUST WANT TO MAKE SURE THAT THE OTHER SPEAKERS OR THE NEXT FEW SPEAKERS I DON'T WANT TO CURTAIL THERE
I DO APPRECIATE, TOM FOR YOUR QUICKNESS, BUT THIS IS WHO WE'RE HERE FOR
IF WE HAVE TO CUT BACK, WE WILL CUT BACK FROM COMMISSIONS, PORT STAFF, BUT WE ALSO HAVE A LITTLE BIT MORE TIME WITH THE EXECUTIVE SESSION
SO PLEASE, WITHOUT FURTHER ADO, PLEASE CALL THE ROLL
THANK YOU, COMMISSIONER BOWMAN
THANK YOU
I'LL BE VERY BRIEF, TOM
I JUST WANT TO SAY THANK YOU TO UNITED FOR YOUR LEADERSHIP IN SAF
YOU'VE BEEN A VERY EARLY LEADER IN THIS AND REALLY APPRECIATE IT
MY QUESTION OR MAYBE SUGGESTION
I'D LOVE TO BE ABLE TO TALK WITH YOU AND THE OTHER AIRLINES ABOUT ANOTHER WAY TO INCENTIVIZE FUNDS FOR SAF, WHICH WOULD BE AN INCREASE IN THE PASSENGER FACILITY CHARGE IF IT WERE DEDICATED TO INVESTING IN PRODUCTION FACILITIES
AND I KNOW IT'S BEEN A CONTENTIOUS ISSUE WITH THE AIRLINES FOR MANY YEARS
I REALLY APPRECIATE THE VOLUNTARY NATURE OF THE PROGRAMS FOR INDIVIDUALS TO VOLUNTARILY CONTRIBUTE, BUT I THINK THAT ANOTHER WAY THEY CAN CONTRIBUTE IS WITH A VERY SMALL PORTION OF AN INCREASE IN THE PASSENGER FACILITY CHARGE
AND SO WE LOOK FORWARD TO TALKING WITH ALL OF YOU ABOUT THAT LATER
THANK YOU
THANK YOU, COMMISSIONER BOWMAN
COMMISSIONER CALKINS, YEAH
THANK YOU, TOM
I HAVE ALSO ADMIRED THE WORK THAT UNITED IS DONE AS A TRAILBLAZER IN THIS AREA
AND YOUR COMMENT TODAY ABOUT THE FEDERAL GOVERNMENT'S ROLE IN BUYING TICKETS AND SPACE IN THE BELLY CARGO, YOUR PLANES AND IF WE CAN GET THEM TO REALLY FACTOR IN THE REAL COST, THE NEGATIVE EXTERNALITIES, BUT FOR SO LONG HAVE BEEN IGNORED IN AVIATION
THAT WOULD BE A HUGE STEP FORWARD IN GETTING THESE BLENDS INTO YOUR PLANES
AND PARTICULARLY FOR WASHINGTON STATE, WE ARE A VERY HIGH PER CAPITA STATE IN TERMS OF SERVICE MEMBERS AS PART OF THE POPULATION
AND I KNOW THAT WE HAVE A LOT OF SERVICE MEMBERS FLYING THROUGH SEATAC REGULARLY, SO I THINK THAT'S A REALLY INTERESTING PART OF THE CONVERSATION
I'LL MAKE SURE THAT WE HAVE THAT CONVERSATION WITH CHINTEL ABOUT GETTING IT ON TO OUR FEDERAL AGENDA
THANK YOU, COMMISSIONER CALKINS
COMMISSIONER TOO, I JUST WANT TO ECHO THE SENTIMENTS OF MY COLLEAGUE ON THE GREAT WORK THE UNITED IS DOING
AN INTEREST OF TIME
I WILL HOLD ON MY QUESTIONS AND FOLLOW UP AT THE LATER DAY, BUT THANK YOU SO MUCH FOR BEING DONE
THANK YOU, COMMISSIONER CHO COMMISSIONER STEINBEUCK
YEAH
I ALSO WILL PILE ON AND EXPRESSING APPRECIATION, PARTICULARLY FOR YOUR ECO SKIES ALLIANCE
I THINK THAT'S REALLY BEING A TRENDSETTER THERE AND LOOKING TO OTHER WAYS BESIDES CARBON OFFSETS
AND IF BUSINESS TRAVELERS FLY COACH INSTEAD OF BUSINESS CLASS, THEY PROBABLY COULD COVER EASILY PREMIUM COST OF SAF
I DON'T WANT TO ENCOURAGE THAT, BUT I PROBABLY NOT
BUT I REALLY LIKE YOUR COMPREHENSIVE APPROACH
THAT DOESN'T INCLUDE MAKING IT UP WITH CARBON OFFSETS AND OTHER TECHNOLOGIES ARE INTRIGUING
LOCAL ELECTED LOCAL
WHAT DO THEY CALL CONNECTOR FLIGHTS THAT HAVE SHORT RUNS USING ELECTRIC? I THINK THERE'S A BIG FUTURE, AN ELECTRIC ENERGY OR POWER FOR THE SHORT FLIGHTS AS WELL
JUST FROM WHAT I'VE READ
AND I KNOW WE HAVE A GREAT START UP HERE IN THE REGION RIGHT NOW THAT'S DEVELOPING THAT TECHNOLOGY
SO I JUST WANTED TO SAY THANKS, INSIGHTFUL, KEEP UP THE GREAT WORK
THANK YOU ALL
REALLY APPRECIATE IT
COMMISSIONER FELLEMAN
THANKS AGAIN, TOM
AND TO ALL THE AIRLINE PARTICIPANTS TODAY
CLEARLY THERE'S A LOT MORE TO DISCUSS AND REALLY LOOK FORWARD TO PARTNERING WITH YOU AS WE MOVE TO OUR SUCCESS AT THE STATE LEGISLATIVE LEVEL TO THE FEDERAL SO THAT WE CAN MAKE THIS A NATIONWIDE SUCCESS STORY
REALLY
THANKS SO MUCH FOR YOU GUYS
MAKING THE TIME
IT'S REALLY EXCITING AND ENCOURAGING
WE'LL NOW MOVE TO OUR PRIVATE SECTOR SAF PRESENTATIONS
WE'LL HEAR FROM MICROSOFT AND FROM BIO BREAKTHROUGH ENERGY, AND WE HAVE 10 MINUTES FOR EACH PRESENTATION WITH FIVE MINUTES FOR QUESTIONS AFTERWARDS
AND WE'RE JUST A LITTLE BIT LATE HERE
WE'RE JUST LIKE 10 MINUTES OVER 12 MINUTES, SO WE'RE DOING FINE
LIKE I SAID, PLEASE TAKE YOUR TIME TO MAKE YOUR PRESENTATION
THANK YOU
SO FIRST UP, WE HAVE JULIA FIDDLER, SENIOR SUSTAINABILITY PROGRAM MANAGER WITH MICROSOFT
WELCOME, JULIA, AND PLEASE LET US KNOW WHEN YOU'RE READY TO DISPLAY THE PRESENTATION AND THE CLERK WILL ADVANCE THE SLIDES AS YOU CALLED
JULIA, YOU HAVE THE FLOOR
THANK YOU FOR THE INTRODUCTION
HAPPY TO GO STRAIGHT TO THE SLIDES
SO THANK YOU FOR INVITING ME TO JOIN THE PRESENTATION TODAY
AS DESCRIBED
MY NAME IS JULIA FIDDLER AND I'M A SUSTAINABILITY PROGRAM MANAGER HERE AT MICROSOFT
IF WE CAN MOVE TO THE FIRST SLIDE, I WANTED JUST TO START WITH A LITTLE BIT OF BACKGROUND ABOUT THE WORK MICROSOFT IS DOING IN THE SPACE OF SUSTAINABILITY SO THAT I CAN RELATE IT TO THE WORK WE'RE DOING AROUND SUSTAINABLE AVIATION, FUEL
AND SO DESCRIBING OUR COMMITMENT TO SUSTAINABILITY, WE ARE COMMITTED TO PLAYING A POSITIVE ROLE
NOT ONLY IS IT THE RIGHT THING FOR US TO DO, BUT IT'S COMPLETELY CORE TO OUR BUSINESS
AT MICROSOFT, WE ARE, AS EXPECTED, AND KNOWN GROWING CONSUMER OF ENERGY AND WATER
BUT THE THEREFORE WE HAVE A RESPONSIBILITY TO BE PART OF THE SOLUTION
AND WE'RE REALLY COMMITTED TO HARNESSING THE POWER OF TECHNOLOGY TO HELP EVERYONE EVERYWHERE, TO BUILD A MORE SUSTAINABLE FUTURE
AND IT'S POWERFUL TO ME THAT THESE WORDS FROM OUR LEADERSHIP THAT I HAVE ON THIS SLIDE HERE TRANSLATE TO ACTION AT EVERY LEVEL
SO THE ABILITY FOR OUR LEADERSHIP TO STATE LARGE, BOLD COMMITMENTS THEN REALLY DRIVES CHANGE AT AN OPERATIONAL LEVEL WHERE I CAN SAY MY OWN ROLE IS OPERATING
AND FROM THIS STATEMENT TO OUR 2020 ANNOUNCEMENT TO BECOME CARBON NEGATIVE BY 2030 AND HOW THAT THEN FILTERS DOWN TO THE EMISSIONS CATEGORIES, INCLUDING THAT OF AVIATION I'LL COVER IN THESE COMING SLIDES
NEXT SLIDE, PLEASE
SO TO COVER THE VERY LATEST AMBITIONS IN MORE DETAIL, WE'VE MADE COMMITMENTS TOWARDS WATER, WASTE AND ECOSYSTEMS, BUT FOR THIS SPECIFIC PURPOSE, I'LL COVER MORE DETAILS ABOUT OUR CARBON COMMITMENTS
BY 2025
WE'RE AIMING TO HAVE NEARLY ELIMINATED OUR DIRECT EMISSIONS THROUGH ENERGY EFFICIENCY
WORK BY 2030 WILL HAVE REDUCED OUR SCOPE THREE EMISSIONS BY HALF
AND THIS IS WHERE THE MAJORITY OF OUR MISSIONS RELATED TO AIR TRAVEL ARE ATTRIBUTED
TODAY BY 2050, WE AIM TO HAVE REMOVED ALL OF OUR HISTORICAL EMISSIONS
CARBON NEUTRAL IS NO LONGER ENOUGH
AND BEHIND EACH OF THESE COMMITMENTS, THE TEAMS OF PEOPLE LIKE MYSELF WORKING TOGETHER TO SOLVE THE CHALLENGES THAT TOGETHER WE NEED TO OVERCOME
NEXT SLIDE, PLEASE
SO MOVING FORWARD TO DESCRIBE MORE SPECIFICALLY HOW THIS RELATES TO HOW WE VIEW SUSTAINABILITY WITHIN THE TRAVEL CATEGORY AT MICROSOFT
OUR WORK STARTED IN COLLABORATION WITH THE CARBON TEAM AT MICROSOFT A COUPLE OF YEARS AGO, AND AS WE WORK TOGETHER TO INTRODUCE THE PROGRAM INTENDED TO EMPOWER OUR EMPLOYEES INITIALLY THROUGH EDUCATION AND AWARENESS AROUND THE IMPACT OF TRAVEL ON THE ENVIRONMENT, WE THEN LOOKED AT HOW WE COULD ALIGN ALL OF OUR SUSTAINABILITY AMBITIONS FOR TRAVEL TRAVEL WITH OUR ALL UP CARBON EMISSIONS AT GOALS WHICH ARE REDUCE, REPLACE AND REMOVE
AND SO WE HAD STARTED WITH THE REDUCTION OF TRIPS AND LOOKING AT OPTIMIZING TRAVEL AND THEN REALLY CONSIDERED HOW WE COULD LOOK TO SUPPORT THE OPPORTUNITY TO REPLACE THE USE OF FOSSIL FUELS WITH SUSTAINABLE ALTERNATIVES
I CAN SAY THAT AT THE TIME WHEN WE STARTED THE PROGRAM, WE REALLY DIDN'T HAVE A DEPTH OF UNDERSTANDING OF SUSTAINABLE AVIATION FUEL AND WE'RE A TECHNOLOGY COMPANY
SO ESSENTIALLY WHY WOULD WE BUT WE WERE ABLE TO WORK WITH PARTNERS TO REALLY LEARN AND UNDERSTAND WHAT WAS FEASIBLE TODAY AND WHAT WAS THE PROJECTION IN THE NEXT COMING YEARS? HOW SPECIFICALLY COULD MICROSOFT SUPPORT WITH THE FURTHER PRODUCTION AND DEVELOPMENT OF THIS SAF MARKET? SO MOVING TO THE NEXT SLIDE
THIS IS AN EXAMPLE OF A SLIDE THAT I USED INTERNALLY FOR STAKEHOLDER ENGAGEMENT ON THIS TOPIC, WHICH WAS REALLY IMPORTANT THAT WE ENGAGED SENIOR LEADERSHIP TO UNDERSTAND THE VISION AND TO ULTIMATELY GAIN FUNDING FOR OUR FIRST PILOT PROJECT, WHICH WAS ENABLED DUE TO THE CARBON FEE THAT WE'VE HAD IN PLACE FOR A NUMBER OF YEARS AT MICROSOFT
SO THE INTERNAL CARBON FEE SUPPORTS ON A NUMBER OF DIFFERENT SUSTAINABILITY INITIATIVES, AND WE WERE ABLE TO DESCRIBE WHY SUSTAINABLE AVIATION FUEL WAS REALLY IMPORTANT TO ALIGN WITH OUR AMBITIONS AT MICROSOFT FOR CARBON REDUCTION
WE DESCRIBED HOW EARLY INVESTMENT FROM MICROSOFT IN SUSTAINABLE AVIATION FUEL COULD DIRECTLY HELP TO GENERATE INDUSTRY MOMENTUM, WHICH WAS VERY MUCH NEEDED
YOU'VE HEARD EARLIER IN THE SLIDES AND PRESENTATION HOW LIMITED THAT SAF PRODUCTION IS TODAY TO JUST TWO PRODUCTION FACILITIES GLOBALLY OF ANY SIZE
THERE ARE OTHERS, BUT WE REALLY NEEDED MORE PRODUCTION AS HIGH QUALITY SAF TO BE ABLE TO ACHIEVE OUR AMBITIONS AND USE SAF AS A MECHANISM TO ENABLE TRAVEL IN LINE WITH OUR AMBITIONS TO REDUCE USE CARBON
SO WE TALKED ABOUT HOW SAF OFFERS A REALLY CREDIBLE ALTERNATIVE TO OFFSETTING WE SOMETIMES DESCRIBED AS IN SETTING, SO BETTER ENABLING BOTH MITIGATION AND INNOVATION IN THE TRAVEL SPACE
WE TALKED ABOUT HOW THE COST OF SAF IS DEFINITELY AT A PREMIUM
YOU'VE HEARD THAT AS WELL TODAY COMPARED WITH FOSSIL FUELS, BUT THAT THE ECONOMICS ARE IMPROVING AS AN INVESTMENT FROM THE CORPORATE SECTOR REALLY HAVE THE POSSIBILITY TO DEMONSTRATE CONFIDENCE TO THOSE EXTERNAL INVESTORS THAT ARE REALLY CRITICAL TO ENSURING NEW PRODUCTION CAPACITY AT SCALE IN THE NEAR TERM
AND THEN I EXPLAINED TO EXECUTIVES HOW IT WAS IMPORTANT THAT AS A MAJOR CONSUMER AND CUSTOMER OF THE AIRLINES, WE SHOULD SHARE OUR EXPECTATIONS AND REQUIREMENTS NOW SO THAT AIRLINES REALLY PURCHASE SAF THAT MEET THE HIGHEST POSSIBLE SUSTAINABILITY STANDARDS
WE REALLY DON'T WANT A RACE TO THE BOTTOM TO THE LOWEST POSSIBLE COST AND ALSO THE LOWEST POSSIBLE STANDARDS
WE WANT TO BALANCE THOSE TWO AND MAKE IT ECONOMICALLY VIABLE
BUT ALSO ULTIMATELY, THIS IS ABOUT MAKING THE MOST POSITIVE IMPACT ON THE ENVIRONMENT
AND LASTLY, WHILE DIRECTLY REDUCING CARBON EMISSIONS ON A SMALLER SCALE TODAY
THIS WORK ENGAGES BUSINESS GROUPS INTERNALLY IN MICROSOFT AND INDIVIDUALS, EMPLOYEES THAT ARE REALLY PASSIONATE ABOUT THIS TOPIC OR THOSE THAT JUST WANT TO LEARN MORE WITH A POSITIVE APPROACH TO CARBON REDUCTION RELATED TO TRAVEL
WHILE STILL SUPPORTING EDUCATION ABOUT THE ADDITIONAL AND IMMEDIATE OPPORTUNITIES TO REDUCE CARBON, FOR EXAMPLE, TRIP REDUCTION AND OTHER RESPONSIBLE TRAVEL TO YOUR CHOICES THAT WE COMBINE
THIS SLIDE THAT YOU HAVE HERE IS JUST ANOTHER EXAMPLE OF EDUCATION THAT WE USED IN THE DISCUSSIONS WE HAD WITH SUPPLIERS TO TALK ABOUT WHAT WAS IMPORTANT TO MICROSOFT
THIS IS NOT ABOUT US JUST MAKING AN EASY TRANSITION ACROSS TO OUR SUPPLIERS OF OUR RESPONSIBILITIES
WE'VE INVESTED TIME AND EFFORT TO LEARN ABOUT THE MARKET TO LEARN ABOUT THE SUSTAINABILITY IMPLICATION AND THE RISKS ASSOCIATED WITH PURCHASING SAF
AND SO THESE FIVE AREAS ARE ONES THAT WE REFER TO ON A REGULAR BASIS WHERE WE TALK ABOUT FEEDSTOCK
IF WE'RE GOING TO INVEST AND SUPPORT THAT ADDITIONAL COST OF SAF, WE WANT TO KNOW WHAT WE'RE PURCHASING
WE WANT TO KNOW HOW IT WAS MADE, WHAT FEEDSTOCK WAS USED, WHAT TECHNOLOGY WAS USED
WE WANT TO UNDERSTAND WHAT THE FUTURE PATHWAY IS TO SCALE THE LAND USE, THE CONSIDERATION OF THAT IMPACT ON THE ENVIRONMENT
TRANSPARENCY
I'LL TALK ABOUT THAT LATER AS WELL
THE CRITICALITY OF US REALLY UNDERSTANDING THE TRANSPARENCY OF THE SUPPLY CHAIN, THE DOUBLE COUNTING ISSUES THAT EXIST WHEN WE THINK ABOUT HOW IKO AND CORSIE IS APPROACHING STAFF, AND THEN WE TALK ABOUT ADDITIONALITY THAT REALLY IF OUR DOLLAR IS GOING TO SUPPORT THE EXTRA COST, IS IT GOING TO PUSH ABOVE AND BEYOND USING THAT SAME METHODOLOGY THAT WE APPLY TO PURCHASING CARBON REMOVAL TODAY
NEXT SLIDE
SO THIS IS JUST A TIMELINE OF THE MAJOR COMMITMENTS THAT MICROSOFT HAS MADE MOVING FROM OUR FIRST PURCHASE TOGETHER WITH KLM BACK IN OCTOBER 2019, WHICH ALLOWED US TO REALLY LEARN AND EXPLORE HOW SAF COULD BE APPLIED TO HELP US REDUCE EMISSIONS RELATED TO BUSINESS TRAVEL
AND REALLY PRACTICALLY, HOW WOULD WE APPROACH IT FROM A CONTRACT PERSPECTIVE? HOW CAN WE GAIN FUNDING FOR IT? HOW CAN WE USE THE FIRST PROJECT TO SUPPORT ON EDUCATION? TO THE SECOND PARTNERSHIP, WHICH KIRK HAS TALKED ABOUT IN MORE DETAIL TODAY, TOGETHER WITH ALASKA AIRLINES AND SKY ENERGY, IT WAS REALLY IMPORTANT THAT WE WORK TOGETHER WITH PARTNERS THAT WERE ALIGNED WITH OUR AMBITION AND PRODUCTION OF SAF IN THE PACIFIC NORTHWEST IS ABSOLUTELY A PRIORITY FOR US
AND THEN TO THE MORE LATEST ANNOUNCEMENT, WHICH IS THAT MICROSOFT IS A FOUNDING MEMBER OF SABA, THE SUSTAINABLE AVIATION FUEL BUYERS ASSOCIATION ALLIANCE
APOLOGIES
AND THAT'S VERY MUCH ABOUT DRIVING FOR TRANSPARENCY AND SUPPORTING THE WORK THAT NEEDS TO HAPPEN AROUND CARBON ACCOUNTING IN THE FIRST PHASE
SO IT'S REALLY IMPORTANT THAT WHEN MICROSOFT OR OTHER COMPANIES INVEST AND SUPPORT THAT EXTRA COST THAT WE HAVE APPROPRIATE AND ACCEPTED STANDARDS AROUND CARBON ACCOUNTING, HOW CAN WE CLAIM FOR THE BENEFITS APPROPRIATELY ENSURE THERE'S NO DOUBLE COUNTING? THAT'S REALLY THE ASSET THAT WE'RE PURCHASING IS THAT CARBON ACCOUNTING ELEMENTS
AND SO IT'S REALLY IMPORTANT THAT WE WORK TOGETHER WITH PARTNERS LIKE RMI ROCKY MOUNTAIN INSTITUTE, AN EDF TO HELP TO ACHIEVE THOSE STANDARDS, AND THEN THAT MAKES IT REALLY SCALABLE FOR OTHER CORPORATES TO WORK IN THIS SPACE AS WELL, WHERE THEY MAY NOT HAVE THE RESOURCES TO DEDICATE TIME AS WE HAVE TO LEARN ABOUT THE STANDARDS AND TO SUPPORT THE SUSTAINABLE AMBITIONS
SO I JUST I THINK THAT MAYBE MY LAST SLIDE
I WANT TO JUST SAY THAT OUR MAIN FOCUS REMAINS AT THIS TIME TO PROVIDE A STRONG DEMAND SIGNAL
WE WANT TO SUPPORT INCREASED PRODUCTION, AND WE HOPE THAT THE PACIFIC NORTHWEST CAN REALLY WORK TOGETHER TO ENABLE A FUTURE OF SAF
AND THANK YOU FOR ALLOWING ME THIS TIME TODAY AND THE OPPORTUNITY TO PRESENT CONGRATULATIONS ON THE GREAT REGIONAL PROGRESS THAT'S BEEN MADE AS WELL
JULIA, THANK YOU SO MUCH FOR MICROSOFT INTERNATIONAL LEADERSHIP IN THIS ENVIRONMENT AND YOUR COMMITMENT TO TECHNOLOGICALLY ROUTE AND TRANSPARENT PROCESS
IT'S SETTING THE BAR AS YOU ALWAYS DO
AND I'M PROUD TO HAVE YOU AS A HOME THROWN COMPANY
WE ARE REALLY RUNNING TIGHT, SO I WOULD LIKE VERY MUCH WE'RE RUNNING BEHIND, SO I REALLY MUCH APPRECIATE IT FOR MY COLLEAGUES
CAN KEEP THE QUESTIONS TO A MINIMUM AND SHORT AND NO DOUBLE DIPPING
SO ANYWAY
CLERK, PLEASE CALL THE ROLL
COMMISSIONER BOWMAN, I'LL PASS IN ANY QUESTIONS
THANK YOU, JULIA, FOR MICROSOFT LEADERSHIP
COMMISSIONER CALKINS, I JUST HAVE FIVE OR 6, SO I'LL GO, REALLY? I'M JUST KIDDING
I'LL PASS
THANK YOU, JULIA
GREAT PRESENTATION
THANK ROUTE
I'LL DO THE SAME
THANK YOU SO MUCH FOR YOUR PRESENTATION TODAY, COMMISSIONERS
TIME FOR NO QUESTIONS
THANKS, COMMISSIONER FELLEMAN
WELL, THANKS AGAIN
AND JULIA, KNOW YOU HAVE A GREAT CHAMPION IN COURTNEY GREGOIRE, WHO BEFORE SHE LEFT THE COMMISSION, WAS ALWAYS TALKING ABOUT MICROSOFT'S LEADERSHIP
AND SO THANK YOU AGAIN
AND DON'T THINK OUR LACK OF QUESTIONS AS ANY REFLECTION OF OUR LACK OF INTEREST, WE KNOW WHERE TO FIND YOU
SO THANKS, A REALLY APPRECIATE YOUR TIME
SO NOW WE WILL HEAR FROM JAY DESI, STRATEGY AND OPERATIONS MANAGER WITH BREAKTHROUGH ENERGY
LET KNOW WHEN YOU'RE READY, AND WE'LL DISPLAY YOUR PRESENTATION, AND THE CLERK, HART WILL ADVANCE THE SLIDES AT YOUR INDICATION
GREAT
WELL, THANK YOU ALL FOR HAVING ME EXCITED TO BE HERE AND REALLY LEARN FROM A LOT OF YOU ALL ABOUT THE GREAT WORK THAT'S BEING DONE
SO YOU CAN PULL UP THE SLIDES NOW
AND I'M HAPPY TO TELL YOU A LITTLE BIT ABOUT OUR WORK AT BREAKTHROUGH ENERGY AND SPECIFICALLY THE CATALYST PROGRAM THAT WE'RE LAUNCHING TO FUND EMERGING CLIMATE TECHNOLOGIES, INCLUDING SUSTAINABLE AVIATION FUEL
SO IF YOU GO TO THE NEXT SLIDE, JUST TO GIVE A BIT OF CONTEXT ON WHO WE ARE, BREAKTHROUGH ENERGY, WE ARE A NETWORK OF ENTITIES THAT WAS FOUNDED BY BILL GATES BACK IN 2015 THAT SUPPORTS COMMERCIALIZATION OF CLEAN ENERGY AND CLIMATE TECHNOLOGIES ON THE PATH TO NET YOUR EMISSIONS BY 2050
SO WE DO A COUPLE OF DIFFERENT THINGS ACROSS THE LANDSCAPE OF INNOVATION ALL THE WAY FROM R&D THROUGH LARGE SCALE DEPLOYMENT
WE'RE MOST WELL KNOWN THUS FAR FOR OUR VENTURE CAPITAL FUND CALLED BREAKTHROUGH ENERGY VENTURES, WHICH INVESTS IN EARLY STAGE TECHNOLOGIES ALL THE WAY FROM THE SEED STAGE THROUGH SERIES C AND D
WE JUST LAUNCHED A SECOND FUND THAT CLOSED THE BEGINNING OF THIS YEAR AND HAVE OVER 2,000,000,000 DOLLARS THAT WE'RE INVESTING IN EARLY STAGE STARTUPS
WE'RE NOW BUILDING A BROADER NETWORK, AS I MENTIONED, AND IN PARTICULAR, WHAT I AM HERE TO TALK ABOUT AND THE PROGRAM I WORK ON IS CALLED BREAKTHROUGH ENERGY CATALYST, WHICH IS REALLY ABOUT HOW WE CAN DEPLOY NEW TECHNOLOGIES IN DEMONSTRATIONS AND COMMERCIAL STAGE APPLICATIONS WITH THE GOAL OF DRIVING DOWN COSTS AND INCREASING PRODUCT AVAILABILITY
AND SO WE'RE EXCITED TO BE IN THIS CONTEXT OF THE BROADER COMMERCIALIZATION CHALLENGE AND THINK THAT WE CAN HELP SOLVE SOME OF THE KEY GAPS WHEN IT COMES TO SCALING UP
SO IF YOU GO TO THE NEXT SLIDE, BREAKTHROUGH ENERGY IN GENERAL, AGAIN, IS ABOUT HOW WE COMMERCIALIZE THE SET OF TECHNOLOGIES WE NEED THAT REALLY INCLUDES A BROAD SET OF SOLUTIONS
AND WE KIND OF THINK ABOUT THOSE SOLUTIONS IN TWO KEY BUCKETS
THERE'S THINGS THAT FACE THE IMPLEMENTATION CHALLENGE, WHERE THEY'VE ALREADY COME DOWN AND COST SIGNIFICANTLY
AND REALLY WHAT WE NEED TO DO IS HELP THEM GET TO SCALE
AND THEN THERE'S TECHNOLOGIES THAT FALL IN THE INNOVATION CHALLENGE BUCKET WHERE WE NEED TO DRIVE DOWN COSTS AGAIN THROUGH REALLY DEPLOYMENT AND THROUGH INVESTMENT THAT CAN HELP THEM SUCCEED
AND SO WHEN WE THINK ABOUT SUSTAINABLE AVIATION FUEL AND OTHER TECHNOLOGIES
WE REALLY SEE THAT RIGHT NOW AS AN INNOVATION CHALLENGE WHERE WE NEED TO FIGURE OUT HOW WE CAN CREATE THE RIGHT MARKET ECOSYSTEM AND SUFFICIENT INVESTMENT IN ORDER TO HELP THESE TECHNOLOGIES COMPETE WITH FOSSIL FUEL INCUMBENTS
IF YOU GO TO THE NEXT SLIDE, AS WE LOOK AT THE LANDSCAPE OF THE ACTIONS NEEDED TO GET TO ZERO AGAIN ACROSS THESE TWO BUCKETS, WE THINK THAT THE IMPLEMENTATION CHALLENGE IS WELL COVERED IN MANY WAYS BY THE EXISTING SYSTEMS FOR REPORTING AND QUANTIFICATION AND RECOGNITION
SOME OF THE THINGS THAT OTHERS HAVE TALKED ABOUT, LIKE CARBON OFFSETS OR CORPORATE REPORTING MECHANISMS LIKE SCIENCE BASED TARGETS, HAVE REALLY MADE A LOT OF REMARKABLE PROGRESS OVER THE LAST SEVERAL YEARS
BUT FROM OUR PERSPECTIVE, WHEN IT COMES TO THE INNOVATION CHALLENGE, THERE IS NOT SUFFICIENT RECOGNITION AND NOT SUFFICIENT PRODUCTS IN PLACE TO HELP CATALYZE INVEST INTO THINGS LIKE SAF AND OTHER TECHNOLOGIES AT A SIMILAR STAGE, LIKE DIRECT AIR CAPTURE, WHICH SOME OF THE FOLKS EARLIER MENTIONED GREEN HYDROGEN PRODUCTION AS WELL AS LAND RATION ENERGY STORAGE
AND SO WHAT WE'RE TRYING TO DO WITH THE BREAKTHROUGH ENTRY CATALYST PROGRAM IS REALLY INCENTIVIZED INVESTMENT INTO THESE TECHNOLOGIES AT A SCALE THAT'S WELL BEYOND WHAT'S AVAILABLE IN MANY CASES TODAY
SO IF YOU GO TO THE NEXT SLIDE, WE THINK GENERALLY ABOUT THIS CONCEPT OF THE GREEN PREMIUM THAT OTHERS HAVE MENTIONED AND REALLY WHERE WE WANT TO PRIORITIZE OUR EFFORT ARE IN PLACES WHERE THERE'S A HIGH GREEN PREMIUM RIGHT NOW AND NOT NECESSARILY A COORDINATED EFFORT TO ADDRESS THEM
AND SO WE SHOW TWO EXAMPLES HERE, ONE AROUND ELECTRIC VEHICLES, WHERE THERE IS STILL A GREEN PREMIUM, BUT IT'S RELATIVELY SMALL
AND WE THINK THAT OVER THE NEXT SEVERAL YEARS, THE GREEN PREMIUM MAY EVEN GO TO ZERO OR BE NEGATIVE FOR ELECTRIC VEHICLES RELATIVE TO INTERNAL COMBUSTION ENGINE VEHICLES
AND THEN WHEN YOU LOOK AT SUSTAINABLE AVIATION FUEL, OBVIOUSLY THERE ARE MANY DIFFERENT TYPES OF WAYS TO MAKE SAF, BUT RIGHT NOW PRICES ARE JUST TOO HIGH, AND THEY'RE OFTEN 2 OR 3 TIMES MORE EXPENSIVE, DEPENDING ON THE TECHNOLOGY USED TO DEVELOP THEM
AND SO THAT'S WHERE THE CAPITALIST PROGRAM COMES IN
IF YOU GO TO THE NEXT SLIDE, WE TELL YOU A LITTLE BIT ABOUT WHAT THE PROGRAM IS WORKING ON
OUR GOAL IS TO BUILD A COALITION AND PARTNERSHIP ACROSS A BROAD SET OF STAKEHOLDERS THAT INCLUDE AIRPORTS, AIRLINES, OTHER VALUE CHAIN PARTNERS ULTIMATELY RAISE CAPITAL FROM A BROAD SET OF CONTRIBUTORS THAT INCLUDE PHILANTHROPISTS, GOVERNMENTS AND COMPANIES, AND THEN DEPLOY THAT CAPITAL TOWARD PROJECTS THAT CAN DRIVE DOWN COSTS
SO WE THINK THAT THIS TYPE OF A MODEL CAN BE REALLY HELPFUL IN TERMS OF INCREASING SUPPLY OF THESE NEW TECHNOLOGIES, BECAUSE WE'LL FUND UPFRONT CAPEX CONSTRUCTION OF THINGS LIKE SUSTAINABLE AVIATION FUEL REFINERIES OR GREEN HYDROGEN ELECTROLYZERS OR LONGDURATION BATTERY STORAGE APPLICATIONS WILL THEN WORK WITH BUYERS AROUND CREATING DEMAND AND COMMITTING TO LONGER TERM OFF TAKE AGREEMENTS TO ENSURE THESE PRODUCTS HAVE A MARKET
AND THEN WE WANT TO REPORT ON THAT AND RECOGNIZE CLIMATE LEADERSHIP
AND WE'RE DEVELOPING A NEW SYSTEM CALLED THE CATALYZED EMISSIONS REDUCTION FRAMEWORK, WHICH WILL RECOGNIZE THE CONTRIBUTORS TO CATALYST BASED ON ON A METHODOLOGY WE'RE DEVELOPING WITH THE CARBON DISCLOSURE PROJECT, A UK BASED NONPROFIT
SO IF YOU GO TO THE NEXT SLIDE, WERE, AS I MENTIONED, FOCUSED ON A FEW DIFFERENT TECHNOLOGIES, WHICH INCLUDES SUSTAINABLE AVIATION FUEL AND THE OTHERS I MENTIONED
AND WE PRIORITIZE THESE BECAUSE WE THINK THAT THEY WILL PLAY A CRITICAL ROLE IN A NET ZERO FUTURE
AND BECAUSE WITH A RELATIVELY MODEST AMOUNT OF FUNDING, WE THINK WE CAN HAVE SIGNIFICANT IMPACT DRIVING DOWN COST
AND SO WE'RE LOOKING TO BUILD CATALYSTS AS A 7-10 BILLION DOLLAR FUND THAT WILL DEPLOY CAPITAL TOWARD DEMONSTRATION PROJECTS ACROSS THESE AREAS AND REALLY BUILD A PORTFOLIO OF SOMEWHERE BETWEEN 30 TO 40 PROJECTS THAT DEMONSTRATE THE CAPACITY OF THESE TECHNOLOGIES
SO ON THE NEXT SLIDE, WE SHOW A LITTLE BIT ABOUT HOW THIS WILL WORK
I THINK THIS IS THE LAST SLIDE I HAVE IN HERE
AND THEN HAPPY TO TAKE SOME QUESTIONS
BUT WHAT WE'RE TRYING TO DO IS POOL CAPITAL
AND RIGHT NOW TALKING TO A LOT OF DIFFERENT PARTNERS ABOUT HOW WE CAN ACTUALLY GET INVESTMENT INTO THE FUND OR CAPITAL COMMITTED TO THE PROGRAM
AND THEN WE'LL IDENTIFY BEST IN CLASS PROJECT DEVELOPERS ACROSS THESE TECHNOLOGY AREAS
AND WE PLAN TO RUN A REQUEST FOR PROPOSAL PROCESS WHERE WE IDENTIFY THESE PROJECT DEVELOPERS AND GO THROUGH A SET OF SELECTION CRITERIA TO ULTIMATELY ARRIVE AT THE ONES THAT WILL FUND
AND THEN WE'LL INVEST TO HELP BUILD THESE PROJECTS AND AGAIN, INTEGRATE THEM INTO MARKETS
AND SO YOU CAN SEE AN EXAMPLE, AN ILLUSTRATIVE EXAMPLE HERE, WHERE WE'RE SHOWING WHAT A SUSTAINABLE AVIATION FUEL FACILITY IN THE PACIFIC NORTHWEST MIGHT LOOK LIKE
WE'RE OBVIOUSLY REALLY INTERESTED, GIVEN BILL CASES PRESENCE IN THE PACIFIC NORTHWEST, OF THINKING ABOUT HOW WE CAN CREATE A REGIONAL ECOSYSTEM THERE AND IN PARTICULAR, INVEST IN SOME OF THESE NEW PRODUCTION FACILITIES AND ARE TALKING TO PRODUCT DEVELOPERS ABOUT HOW WE CAN INCREASE THAT CAPACITY
AND SO ULTIMATELY, WHAT WE WANT TO DO IS HELP COVER THAT GREEN PREMIUM BOTH ON THE CAPEX SIDE AND ON THE OFF TAKE AGREEMENT SIDE SO THAT WE CAN GET MORE INVESTMENT AND FACILITIES BUILT
SO THAT'S LARGELY AN OVERVIEW OF THE PROGRAM
AND AGAIN, HAPPY TO TAKE QUESTIONS AND APPRECIATE YOU ALL TAKING THE TIME TO RUN THIS WORKSHOP
AND IT'S BEEN REALLY INFORMATIVE FOR ME
THANK YOU SO MUCH
AND I'M REALLY GLAD TO HEAR I HEAR AN ECHO
PLEASE
SOMEBODY TURN OFF THEIR MICROPHONE
BUT IT'S REALLY GREAT TO HEAR YOU SAYING THAT IT'S A RELATIVELY SMALL INVESTMENT TO BRING SAF TO MARKET, AND IT'S VERY MATURE FIELD
SO I APPRECIATE YOUR SENTIMENT OF THAT
I LOOK FORWARD TO TALKING TO YOU ABOUT REDUCING CAL METHANE WITH KELP, BUT THAT'S ANOTHER CONVERSATION ALTOGETHER
MY COLLEAGUES, IF YOU, CLERK WOULD CALL THE ROLL, WE'RE ABOUT 15 MINUTES LATE, BUT WE'RE DOING WELL, SO LET PLEASE PROCEED, BEGINNING WITH COMMISSIONER BOWMAN FOR QUESTIONS
THANK YOU, JAY
EVERYTHING YOU'VE SAID SPEAK TO MY HEART
I'M ALL ABOUT THE PRODUCTION
I KNOW THAT THERE IS THE EAGERNESS TO DO THIS, BUT IT'S PRODUCTION AT THE END OF THE DAY, RIGHT? IS REALLY THE KEY COMPONENT TO MAKING THIS WORK
SO I GUESS I DON'T HAVE ANY QUESTIONS, BUT I WOULD LOVE TO TALK WITH YOU AS WELL ABOUT ELECTRIC ZERO MISSION DRAYAGE TRUCKS
THERE'S A LOT GOING ON IN THAT
THAT'S SOMETHING THAT I'M PRETTY PASSIONATE ABOUT THESE DAYS, SO THAT COULD HAVE A SIGNIFICANT IMPACT ON OUR MARINE TERMINAL AND OUR LOCAL AIR SHED
BUT THANK YOU FOR YOUR WORK
AND LET'S TALK OFFLINE
I JUST HAVE TOO MANY QUESTIONS THAT PROBABLY CAN'T GET ANSWERED TODAY, BUT I APPRECIATE YOU BEING HERE
THANK YOU
YEAH, THAT SOUNDS GREAT
I'D LOVE TO HAVE A FOLLOW UP CONVERSATION
OKAY
THANK YOU
COMMISSIONER BOWMAN
COMMISSIONER CALKINS, IS THERE ANYTHING ABOUT THE PROPOSALS I'M SURE YOU'VE SEEN AROUND IN TERMS OF FEEDSTOCKS FOR SUSTAINABLE AVIATION FUELS AND BIOFUELS, THAT GIVES YOU HEARTBURN
WAKE UP AT THREE IN THE MORNING
IS THIS REALISTIC? YEAH
I MEAN, I THINK WE'RE STILL EVALUATING EXACTLY WHAT OUR TECHNOLOGY STRATEGY WILL BE
WE WANT TO MAKE SURE THAT ALL THE FEEDSTOCKS WE USE HAVE ENVIRONMENTAL INTEGRITY AND DON'T CAUSE UNNECESSARY SUPPLY CHAIN IMPACTS TO LAND USE
WE'RE PARTICULARLY SENSITIVE TO PALM OIL DERIVATIVES AND FUEL AND WANT TO MAKE SURE THAT AS WE LOOK TOWARD THE FUTURE THAT WE'RE THINKING ABOUT SCALABLE FEEDSTOCKS LIKE MUNICIPAL SOLID WASTE OR WOODY BIOMASS, I THINK THERE'S LOTS OF OPPORTUNITIES FOR US TO HELP SCALE SOME OF THOSE NEW TECHNOLOGIES AND NEW FEEDSTOCKS
WE KNOW THAT THAT'S A LOT OF THE WORK THAT THE COMMISSION IS DONE TO DATE HAS REALLY PIONEERED THAT, INCLUDING THE REPORT THAT YOU GUYS PUT OUT LAST YEAR TO IDENTIFY SOME OF THOSE FEEDSTOCK OPPORTUNITIES
CLERK HART, THANK YOU
COMMISSIONER STEINBRUECK, NO QUESTIONS
JUST VERY IMPRESSED
JAY, THANKS FOR THE PRESENTATION
THANK YOU
THANK YOU
COMMISSIONER CHO, DID I MISS YOU? I APOLOGIZE
OKAY
JAY, THANKS FOR BEING HERE
REALLY EXCITED ABOUT ALL THE WORK THAT BREAKTHROUGH ENERGY IS DOING
I'M CURIOUS TO GET YOUR THOUGHTS ON WHAT ARE SOME OF THE INFRASTRUCTURE BARRIERS YOU SEE TO US ADOPTING NOT JUST SUSTAINABLE AVIATION TOOLS, BUT JUST GENERAL ELECTRIFICATION AND OTHER SUSTAINABLE ENERGY SOURCES? YEAH, IT'S A GREAT QUESTION
AND AS I MENTIONED IN THE PRESENTATION, A LOT OF THE CATALYST PROGRAM IS FOCUSED ON PRODUCTION
BUT, OF COURSE, THERE'S A WHOLE SUPPLY CHAIN AND LOGISTICS INFRASTRUCTURE THAT NEEDS TO BE IN PLACE
I THINK SOME OF THE KEY THINGS THAT WE SEE ARE CERTAINLY ON THE ELECTRIFICATION FRONT, MAKING SURE THAT WE HAVE RENEWABLE CAPACITY AND SIGNIFICANT ABILITY TO HAVE DISPATCHABLE POWER
AND SO WHETHER THAT'S FROM A FIRM ELECTRICITY SOURCE OR USING SOME STORAGE APPLICATION, I THINK THAT WILL BE INCREASINGLY CRITICAL
AND WE SEE POWER TO LIQUID FUELS DOWN THE LINE AS SOMETHING THAT POTENTIALLY WE'RE EAGER TO INVEST IN SO OBVIOUSLY, THAT REQUIRES A LOT OF GREAT INFRASTRUCTURE THAT WE DON'T CURRENTLY HAVE
SO THAT'S ONE THING THAT I THINK WE'RE CERTAINLY WORKING ON FROM A POLICY STANDPOINT AND THINKING ABOUT TRANSMISSION NETWORKS AND OTHER WAYS TO HELP INCENTIVIZE THAT I THINK ON THE FUEL SIDE, CERTAINLY THAT THE US HAS A ROBUST PIPELINE INFRASTRUCTURE, BUT THERE'S OFTEN MORE WORK THAT NEEDS TO BE DONE IN BUILDING THAT OUT AND MAKING SURE THAT WE CAN GET FUEL FROM PRODUCTION TO THE WING OF A PLANE
AND SO A LOT OF OUR POLICY EFFORT AS WELL IS FOCUSED ON HOW WE CAN ADVOCATE FOR THE INFRASTRUCTURE INVESTMENT THAT'S REQUIRED TO MAKE THAT HAPPEN
IT'S REALLY EXCELLENT
THANK YOU, JAY
REALLY APPRECIATE IT
YEAH
THANK YOU, COMMISSIONER
THE COMMISSIONER FELLEMAN, WELL, WE ARE VERY FORTUNATE TO HAVE THE INNOVATION AND TALENT OF OUR ORGANIZATION AND COMBINATION WITH MICROSOFT
AND SO THANK YOU SO MUCH FOR OUR PRIVATE SECTOR PRESENTERS
ULTIMATELY, IF THE DEMAND ISN'T THERE, WE'RE NOT GOING TO BE ABLE TO HAVE THE PRODUCTION
AND IF THE PRODUCTION TECHNOLOGY ISN'T THERE, WE CAN'T MEET THE DEMAND
SO REALLY APPRECIATE THE TIME
AND WE ARE GOING TO NOW SPEAK TO ONE OF THE REALLY KEY SOURCES OF SUSTAINABLE FUEL STOCKS THAT UNFORTUNATELY, WE'RE VERY GOOD AT PRODUCING, WHICH IS A MUNICIPAL SOLID WASTE
AND WE'LL NOW TURN BACK TO OUR PORT SENIOR ENVIRONMENTAL MANAGER, STEPHANIE MEYN, TO UPDATE US ON THE USE OF MUNICIPAL SOLID WASTE AS A FEEDSTOCK, INCLUDING THIS COLLABORATIVE STUDY WE'RE DOING WITH KING COUNTY
AND PLEASE TAKE IT AWAY
STEPHANIE, GREAT
THANK YOU SO MUCH
AND IN THE INTEREST OF TIME, I KNOW COMMISSIONERS HAVE ACCESS TO ME MORE OFTEN AND HAVE HEARD SOME OF THE OUTCOMES OF THE MSW OR THE FEEDSTOCK STUDY IN THE PAST
SO I WILL TRY TO SKIP SOME SLIDES IN THE INTEREST OF TIME AND KIND OF GET TO THE END OF THIS WHERE THE BULK OF THE INFORMATION ABOUT WHERE WE'RE HEADED IS COMING
SO NEXT SLIDE
SO JUST AS A VERY QUICK OVERVIEW, THE FEEDSTOCK STUDY THAT YOU'VE HEARD MENTIONED THAT WSU OR WASHINGTON STATE UNIVERSITY DID FOR THE PORT EXAMINED THE POTENTIAL OF NORTHWEST FEEDSTOCKS, INCLUDING LIPIDS, FOREST RESIDUAL AND MUNICIPAL SOLID WASTE, TO MEET THE PORT 10% SOFT GOAL
NEXT SLIDE
SO THOSE FEEDSTOCKS WERE EXAMINED, AND WHAT I WANT TO POINT OUT IS THAT WHILE LIPIDS ARE THE MOST COMMON CHOICE THAT IS BEING MADE AT WORLD ENERGY
THE SUPPLY OF LIPIDS IS BASICALLY ALREADY KIND OF TAKEN UP BY THE BIOFUEL INDUSTRY IN THE STATE
SO THERE REALLY ISN'T AN OPPORTUNITY THERE
SO WE REALLY FOCUSED A LITTLE BIT MORE ON FORCED RESIDUALS AND MSW AS PART OF TO STUDY
AND I'M GOING TO SKIP KIND OF TO THE MAIN POINT, THOUGH
NEXT SLIDE
THIS IS A PRETTY BUSY SLIDE, BUT THE BULK OR I GUESS THE KEY INFORMATION TO TAKE AWAY FROM THIS IS THAT THESE ARE GRAPHS OF THE PRICE OF THE SUSTAINABLE AVIATION FUEL WITH INCREASING AMOUNTS OF FEEDSTOCK AND WHAT YOU SEE IS THAT AS YOU INCREASE THE FEEDSTOCK, THE PRICE GOES DOWN AND THE BANDS OF THE PRICE ARE RELATED TO REALLY LARGELY THE CAPITAL COST AND WHETHER IT'S A PIONEER FACILITY, WHICH IS THE HIGH END OF THE BAND, OR IF IT'S AN ESTABLISHED IT'S THE THIRD OR FOURTH OF ITS KIND TECHNOLOGY, AND THAT'S SORT OF THE LOWER END OF THE BAND
AND WHAT YOU SEE, THE TOP IS LIPIDS, THE CENTER IS FORCED RESIDUALS, AND THE BOTTOM IS MUNICIPAL SOLID WASTE
BUT WHAT YOU SEE IS THAT MUNICIPAL SOLID WASTE STARTS TO GET INTO A PRICING CATEGORY THAT LOOKS PRETTY COMPETITIVE WITH LIPIDS AND ALSO EVEN COMPETITIVE WITH CONVENTIONAL JET FUEL IF YOU CAN MAKE IT TO SCALE NEXT SLIDE
SO THIS IS SORT OF THE BOTTOM LINE
IT'S A LOT OF INFORMATION
THIS IS A SUMMARY OF THE DIFFERENT TYPES OF TECHNOLOGIES, CONVERSION TECHNOLOGIES, AND THE TYPES OF FEEDSTOCKS THAT YOU COULD COMBINE USING ALL OF THE WASTE IN THE PACIFIC NORTHWEST OR WASTE SOURCES
AND THEN WHAT THE TOTAL INVESTMENT COST WOULD BE TO UTILIZE ALL OF THAT FEED STOCK AND WHAT THE MULTIPLIER TO PETROLEUM JET IS
AND WHAT WE MEAN BY THAT IS HOW MANY TIMES MORE EXPENSIVE IS THIS FINISHED COST OF FUEL COMPARED TO CONVENTIONAL? AND WHAT REALLY STOOD OUT TO US IN THE CONCLUSION OF THIS IS THAT WHEN YOU LOOK AT OVER ON THE RIGHT HAND SIDE FOR MUNICIPAL SOLID WASTE, THE MULTIPLIER WAS 1.5 TO 3
AND AGAIN, THAT DEPENDS ON THE SCALE AND THE TECHNOLOGY USE
BUT THAT PUTS IT AS COMPETITIVE AS SOME OF THE LIPIDS AND EVEN GETS CLOSE TO THE KIND OF PRICING WE'RE LOOKING AT THAT ONCE YOU LAYER IN THE FEDERAL AND STATE INCENTIVES, YOU CAN START GETTING A PRICE THAT LOOKS PRETTY DARN COMPETITIVE WITH CONVENTIONAL FUEL
SO THAT REALLY HAD US AT THE PORT REALLY INTRIGUED FOR OPPORTUNITIES THAT WE COULD LOOK FOR, EXPAND ON THAT
SO LET'S DIG INTO THAT SOME MORE
THIS WAS MY FINAL SLIDE
SO AN OPPORTUNITY AROSE WITH KING COUNTY, WHO ARE REACHING THE LIMITS OF THE CEDAR HILL LANDFILL, AND THEY'RE LOOKING FOR SOLUTIONS FOR THE FUTURE WASTE IN THIS REGION
AND THEY HAVE LOOKED AT EXPORT BY RAIL AND WASTE TO ENERGY FACILITIES IN THE PAST
BUT THEY NEVER EXPLORED A WASTE TO LIQUID FUELS FACILITIES USING THE TYPES OF TECHNOLOGIES THAT WERE EXPLORED IN THE WSU STUDY
AND SO THANKS TO COMMISSIONER FELLEMAN'S PARTNERSHIP DEVELOPMENT WITH THE KING COUNTY COUNCIL, WE HAVE AGREED TO COFUND AND WORK COLLABORATIVELY TO EVALUATE THE OPPORTUNITY TO CONVERT THE REGION'S WASTE TO LIQUID FUELS
AND WE EXPECT WE MAY BRING OTHER PARTNERS IN, LIKE THE CITY OF SEATTLE, INTO THAT FEASIBILITY STUDY BECAUSE OF THE LARGE AMOUNTS OF WASTE THAT THEY PRODUCE IN THAT JURISDICTION
AND WHILE, THE SCOPE OF THE STUDY IS STILL IN DEVELOPMENT WITH OUR KING COUNTY PARTNERS
I WANTED TO GIVE THE COMMISSIONERS A BETTER SENSE OF THE TYPES OF THINGS WE EXPECT TO COVER IN THE STUDY AND WHAT KINDS OF QUESTIONS WE HOPE TO ANSWER
THIS IS REALLY MEANT TO BE BOTH A TECHNICAL AND AN ECONOMIC AND A FEASIBILITY STUDY THAT COVERS A LOT OF THE ASPECTS
SO WE WANT TO UNDERSTAND HOW WE MAINTAIN OR TWEAK THE ECONOMICS OF WASTE COLLECTION AND DISPOSAL TO INCENTIVIZE FUEL PRODUCTION AS AN END USE FOR THAT
WE ALSO ARE VERY AWARE WE KNOW WHAT HAPPENED IN THE IN THE RECYCLING INDUSTRY THAT KIND OF UPENDED THINGS COMPLETELY FOR THE COUNTRY
AND SO WE REALLY WANT TO UNDERSTAND WHICH SPECIFIC WASTE STREAMS CAN BE USED FOR DIFFERENT FUEL CONVERSION TECHNOLOGIES
AND WHAT IS THE FORECAST FOR THOSE TYPES OF WASTE STREAMS IN THE FUTURE? AND IMPORTANTLY, HOW DO YOU AVOID PERVERSE INCENTIVES TO CREATE MORE WASTE? BECAUSE WE HAVE VERY IMPORTANT GOALS FOR WASTE REDUCTION
AND SO WE WANT TO UNDERSTAND THAT BETTER
AND WE NOW HAVE SEEN ON THE HORIZON OTHER TECHNOLOGIES TO CONVERT EVEN WET ORGANICS TO LIQUID FUELS
AND THAT'S A REALLY EXCITING THING BECAUSE THERE'LL BE NO SHORTAGE OF YARD WASTE IN SEATTLE FUTURE FOR THE LONG RUN
SO WE ALSO JUST WANT TO MAKE SURE THAT WE UNDERSTAND WHAT OTHER ISSUES MIGHT ARISE WITH COMPETING INTERESTS FOR WASTE RECYCLING AND COMPOSTING, BECAUSE WE'VE ALSO SEEN THE LIPIDS OF BEING A PRIMARY EXAMPLE THAT IT IS NOW SO COMPETITIVE TO USE WASTE COOKING OIL THAT THOSE PRICES HAVE REALLY RISEN
SO YOU HAVE TO REALLY UNDERSTAND THE LANDSCAPE BEFORE SAYING, OKAY, IT MAKES SENSE TO INVEST IN THAT IN THIS REGION
SO THE STUDY WILL KICK OFF THIS YEAR, AND WE EXPECTED TO BE CONCLUDED IN THE FIRST HALF OF 2022
AND IN FACT, THE PROVISO FROM KING COUNTY REQUIRES IT TO BE DONE BY JUNE 2022
BUT WE HOPE TO HAVE THAT DONE BEFORE THEN
AND WITH THAT, I'D BE HAPPY TO TAKE ANY QUESTIONS FROM COMMISSIONERS
WELL, THANKS AGAIN, STEPHANIE
AND IT SHOULD BE OBVIOUS TO ALL IN ATTENDANCE HOW VERY LUCKY WE ARE TO HAVE YOU AT THE PORT
THEN AGAIN, WE DO HAVE YOU AT THE PORT
SO I'M GOING TO NOW TURN TO DIRECTOR OF GOVERNMENTAL AFFAIRS FOR EXTERNAL RELATIONS NATE CCAMINOS, WHO CAN GIVE US A BRIEF UPDATE ON WHAT THE STATE LEGISLATION, HOW WE MOVE FORWARD FROM THE SUCCESS OF THAT REALLY MONUMENTAL SESSION
AND WE'RE GOING TO RUN 5, 10 MINUTES LATE, HOPEFULLY, THAT YOU FOLKS CAN HANG IN THERE WITH US
BUT I THOUGHT IT'S REALLY IMPORTANT THAT WE SEE HOW THERE'S STILL A PROCESS IN FRONT OF US BEFORE WE CAN REALLY CLAIM TO A LOW CARBON FUEL STANDARD
TAKE IT AWAY NATE
THANK YOU, COMMISSIONER FELEMAN, AND GOOD MORNING, COMMISSIONERS
MY NAME IS NATE CAMINOS AND I'M THE DIRECTOR OF GOVERNMENT RELATIONS HERE AT THE PORT OF SEATTLE
ALSO JOINING ME AS DENNIS MCCLARE IN OUR ENVIRONMENTAL POLICY CONSULTANT, BUILDING OFF THE WORK WE'RE DOING LOCALLY WITH KING COUNTY, I'M MUNICIPAL SOLID WASTE THAT STEPHANIE JUST SPOKE TO
WE'RE HERE TODAY TO GIVE YOU A RECAP ON THE LOW CARBON FUEL STANDARD BILL THAT JUST PASSED OLYMPIA THIS WEEKEND
AND A BRIEF OVERVIEW OF OUR EFFORTS ON THE FEDERAL LEVEL IN WASHINGTON, DC
JUST TWO DAYS AGO, ON FINAL DAY OF SESSION THIS PAST SUNDAY, THE STATE HOUSE AND SENATE AGREED TO THE CONFERENCE REPORT ON REPRESENTATIVE AT KEVIN'S LOW CARBON FUEL STANDARD HOUSE BILL 1091
THIS WAS THE FIFTH SESSION THAT REPRESENTED FITZGIBBON HAD ATTEMPTED TO MOVE THE BILL, WHICH WAS ALSO A SIGNATURE PRIORITY FOR GOVERNOR INSLEE AND THE HOUSE AND SENATE DEMOCRATIC CAUCUSES
THE PORT ADOPTED THIS AS OUR TOP LEGISLATIVE PRIORITIES SINCE 2018 LEGISLATIVE SESSION, BASED PRIMARILY ON THE ADVICE FROM OUR ENVIRONMENTAL TEAM THAT WAS SEEKING TO IMPLEMENT THE COMMISSION'S VISION ON SUSTAINABLE AVIATION FUELS, THE POLICY PUT IN PLACE BY HOUSE BILL 1091 IS RELATIVELY SIMPLE
IT REQUIRES PRODUCERS OF TRANSPORTATION FUELS TO MEET A CARBON INTENSITY THRESHOLD SENT BY THE DEPARTMENT OF ECOLOGY
PRODUCERS WHO DON'T MEET THAT THRESHOLD GENERATE OBLIGATIONS, AND PRODUCERS THAT BLEND IN BIOFUELS TO REDUCE THE CARBON INTENSITY BELOW THE THRESHOLD GENERATE CREDITS
THOSE HAVE VALUE ON THE OPEN MARKET, SINCE PRODUCERS THAT GENERATE OBLIGATIONS WILL NEED TO PURCHASE THEM TO COMPLY WITH THE PROGRAM
FOR US AT THE PORT, THE BILL WILL HAVE A SIGNIFICANT IMPACT ON OUR WORK TO REDUCE THE EMISSIONS FROM OUR OPERATIONS
IT WILL MEAN MORE BIOFUELS IN THE MARKET IN WASHINGTON, AND IT WILL DRIVE THEM TO PRICE PARITY WITH CONVENTIONAL FOSSIL FUELS
AND IT WILL MEAN THAT BIOFUELS FACILITIES CURRENTLY PRODUCING THESE FUELS IN OUR STATE, LIKE RENEWABLE ENERGY GROUP IN HOQUIAM WILL SELL THEIR PRODUCTS TO WASHINGTON CONSUMERS RATHER THAN SHIPPING THEM TO CALIFORNIA
SOME OF OUR AIRLINE PARTNERS HERE TODAY HAVE BEEN SIGNALED, AND IT HAD EVEN SIGNALED IT COULD DRIVE THEM PURSUE SUSTAINABLE AVIATION FUELS, INCLUDING DELTA AND THE ADVANCED BIOFUELS, ANNOUNCING A 16,000,000 GALLON OFFTAKE AGREEMENT IN THE MIDDLE OF THE LATEST OF SESSION
THAT ANNOUNCEMENT AND AIRLINE INTEREST IN SUSTAINABLE AVIATION FUELS GENERALLY WAS BIG IN MAKING THE CASE TO THE LEGISLATURE THAT A CLEAN FUEL STANDARD WILL CREATE JOBS FROM WASHINGTON IN THE NEAR TERM
SO THE PASSAGE OF LCFS WAS A HISTORIC STEP FROM WASHINGTON STATE, BUT WE AREN'T QUITE THERE YET
INCLUDING IN THE LEGISLATION WAS LANGUAGE THAT TIES IT TO ADVANCEMENT OF A TRANSPORTATION PACKAGE
SPECIFICALLY, IT REQUIRES A LEGISLATURE TO PASS A FIVE CENT GAS TAX IN ORDER FOR THE DEPARTMENT OF ECOLOGY TO BEGIN ISSUING COMPLIANCE OBLIGATIONS UNDER THE PROGRAM
FUNCTIONALLY, HOWEVER, THE DEPARTMENT OF ECOLOGY CAN BEGIN RULEMAKING AND THE BASSANT BEHIND THE SCENES WORK THAT IS REQUIRED TO GET THE PROGRAM PLACE
THERE ARE THREE MAIN TAKEAWAYS FROM OTHER AMENDMENTS MADE TO THE BILL AS IT WORKED ITS WAY TO THE FINAL CONFERENCE AGREEMENT, THE FIRST WHILE REPRESENTATIVE THAT'S GIVEN'S PREVIOUS BILL PHASE THE PROGRAM BY DIRECTING ECOLOGY TO REQUIRE A 10% CARBON INTENSITY REDUCTION BY 2028 AND A 20% REDUCTION BY 2035
THE CONFERENCE AGREEMENT INSTEAD CAUSE FOR 10% BY 2030 AND 20% BY 2038
IN ADDITION, FOR ECOLOGY TO GO BEYOND A 10% THRESHOLD NOW IN 2031 2033, THE JOINT LEGISLATIVE AUDIT REVIEW COMMITTEE MUST CONDUCT A REVIEW OF THE PROGRAM IMPACTS AND FORWARD THAT TO THE LEGISLATURE FOR FURTHERMORE, THE 10% THRESHOLD COULD NOT BE INCREASED UNTIL AFTER THE 2033 LEGISLATIVE SESSION
LASTLY, IN ADDITION TO THE REQUIREMENT FOR A LEGISLATIVE REVIEW WHEN THE CARBON INTENSITY REACHES 10% TO GO ABOVE THE REDUCTION AMOUNT, THE STATE MUST HAVE DEMONSTRATED A 10% INCREASE IN THE BIOFUEL PRODUCTION CAPACITY OF THE STATE AND IN THIS USE IN THE INSTATE AGRICULTURAL FEEDSTOCKS
FURTHER, TO GO BEYOND THE 10%, THERE WOULD HAVE TO BE AT LEAST ONE 10,000,000 GALLON CAPACITY BIOFUEL FACILITY CITED, AND THE STATE WOULD NEED TO DEMONSTRATE AN ADDITIONAL 60,000,000 GALLON CAPACITY FOR BIOFUEL PRODUCTION AS WELL
THAT MEANS, AS ALWAYS, THERE IS MORE WORK TO BE DONE, BUT HAVING THE PROGRAM IN PLACE AND ECOLOGY BEGINS ITS WORK IS CRITICAL TO ENSURING WE HAVE THE FOUNDATION ON WHICH WE CAN BUILD BEFORE I MOVE ON ON THE FEDERAL UPDATE
WE'VE HAD SO MANY KUDOS TO SHARE EARLIER IN THE STUDY SESSION, BUT I DO WANT TO GIVE A CREDIT TO ERIC FISH, OR STATE GOVERNMENT RELATIONS MANAGER WHO SPEARHEADED THIS EFFORT FOR US THESE PAST FIVE YEARS
TO GET US HERE, ERIC WILL COME BACK TO PRESENT A FULL RECAP OF THE PORT PRIORITIES COMING OUT OF THE 2021 LEGISLATIVE SESSION AT THE MAY 25 TH COMMISSION MEETING NEXT MONTH
COMMISSIONERS CHO AND CALKINS BOTH HAD QUESTIONS ON OUR FEDERAL EFFORTS HERE, AND CRAIG MYERS FROM ALASKA, TOM MICHAELS FROM UNITED REFERENCES BRIEFLY, BUT AT THE FEDERAL LEVEL, THE PORT IS PART OF A DIVERSE COALITION OF AIRLINES, AIRPORTS, PRODUCERS, REFINERS AND LARGE EMPLOYERS LIKE AMAZON AND SUPPORT A TWO DOLLAR PER GALLON SUSTAINABLE AVIATION FUELS BLENDERS TAX CREDIT
THERE IS BROAD AGREEMENT THAT THIS IS AN ACHIEVABLE IMPACTFUL POLICY CHANGE THAT WOULD SIGNIFICANTLY HELP SPEED THEN BROADER IMPLEMENTATION AND UPTAKE OF SUSTAINABLE AVIATION FUELS BY AIRLINES
WE ARE WORKING WITH THE COALITION ON TWO FRONTS, BOTH TO SUPPORT THE INTRODUCTION OF A STANDALONE BILL, WHICH WE EXPECT SHORTLY, AND TO SUPPORT THE BLENDERS TAX CREDITS INCLUSION IN PRESIDENT BIDEN'S AMERICAN JOBS PLAN
ALTHOUGH IT WASN'T CALLED OUT IN THE PRESIDENT SUMMARY DOCUMENT, A RECENT US TREASURY ANALYSIS OF THE AMERICAN JOBS PLAN INDICATED THAT THE BLENDED TAX CREDITS ARE PART OF THE PROPOSAL LED BY OUR SENIOR MANAGER OF FEDERAL AND INTERNATIONAL GOVERNMENT RELATIONS, ERIC SEINFIELD
WE THE PORT OF SEATTLE, ALASKA AIRLINES, AMAZON AND WASHINGTON STATE UNIVERSITY, ARE JOINTLY MEETING WITH KEY MEMBERS OF OUR CONGRESSIONAL DELEGATION TO ADVOCATE FOR THIS POLICY
THAT CONCLUDES MY UPDATE THIS TIME, AND WE THANK YOU WELL, THANK YOU SO MUCH, NATE, FOR THAT QUICK UPDATE AND IS CLEARLY WORK FOR US TO DO AHEAD
I FAIL TO MENTION THAT WE OWE A DEBT OF GRATITUDE ALSO TO KING COUNTY COUNCIL MEMBERS GENIE COLE WELLS AND MRS BOWSKI, WHO OUR PARTNERS IN LEADERSHIP ON THIS MS STUDY
THE ENTIRE COMMISSION IS VERY EXCITED ABOUT IT, BUT THE ENERGY AND SUSTAINABILITY COMMITTEE, LED BY COMMISSIONER BOWMAN AND STEINBREUCK, WHO HAD TO JUST LEAVE, ARE GOING TO BE FOLLOWING THIS IN THEIR STATUS ON AS COMMITTEE CO-CHAIRS
LET'S GO THROUGH THE THE ROLL HERE, AND WE STILL JUST HAVE SOME CONCLUDING COMMENTS FROM OUR EXECUTIVE
SO CLERK HART, PLEASE CALL THE ROLL
YES
BEGINNING WITH COMMISSIONER BOWMAN, NO QUESTIONS
I TO NATE
AND TO THE TEAM, THANK YOU SO MUCH FOR ALL OF THE WORK THAT YOU'VE DONE
ERIC FITCH, I HOPE HE'S ON VACATION TODAY, GIVEN THE LONG HOURS THAT HE'S BEEN ON SESSION
GOOD
BUT MAYBE HE'LL WATCH US LATER AND KNOW HOW GRATEFUL WE ARE FOR ALL THEIR WORK
AND ACTUALLY, I WANT TO AS WELL
CAN I CALL OUT COMMISSIONER? FELLEMAN, THANK YOU FOR YOUR LEADERSHIP
THE MSW STUDY
YOU BROUGHT THIS UP A COUPLE OF YEARS AGO
YOU CANDIDLY KIND OF SPRUNG IT ON US, AND IT WAS BRILLIANT THINKING AS USUAL
AND SO I REALLY APPRECIATE YOU PUSHING THIS FORWARD IN GREAT PARTNERSHIP WITH KING COUNTY OR JUST REALLY EXCITED TO MOVE FORWARD ON THIS AT THE END OF THE DAY
MY NUMBER ONE GOAL IS PRODUCTION IN WASHINGTON STATE FOR ALL OF THIS
IT'S A GREAT OPPORTUNITY FOR NEW INDUSTRIES AND NEW JOBS, AND THAT'S WHERE WE NEED TO GO
SO WHETHER IT'S MUNICIPAL SOLID WASTE OR KELP, SAF, LET'S GET IT DONE
SO THANK YOU TO NATE AND THE REST OF THE TEAM
THANK YOU
COMMISSIONER BOWMAN
MOVING TO COMMISSIONER CALKINS, I WANT TO ACKNOWLEDGE ONE AREA THAT, AS FRED AND I HAVE BEEN WORKING ON THIS QUESTION, WHEN WE WERE SERVING ON THE ENERGY AND SUSTAINABILITY COMMITTEE, WE DID GET VERY THOUGHTFUL PEOPLE FROM THE ZERO WASTE MOVEMENT, CAUTIONING US THAT WE DON'T WANT TO CREATE A NEW INCENTIVE FOR PRODUCING ADDITIONAL MUNICIPAL SOLID WASTE
BUT I THINK WE'VE DONE PRETTY GOOD DUE DILIGENCE TO DETERMINE THAT BOTH THE FUTURE EXPECTED FLOWS, THE MUNICIPAL SOLID WASTE, THE EXISTING AMOUNTS OF MUNICIPAL SOLID WASTE ARE SUCH THAT EVEN A SIGNIFICANT REDUCTION IN MUNICIPAL SOLID WASTE OVER TIME PER CAPITA IN A GROWING REGION WOULD LIKELY MEAN WE STILL HAVE A BIG PROBLEM AND WHAT WE'RE GOING TO DO WITH ALL THAT GARBAGE
SO I THINK THIS IS A VERY CREATIVE RESPONSE THAT CAN ESSENTIALLY SERVE TWO PURPOSES IN ONE MECHANISM
SO I'M REALLY EXCITED FOR THIS STUDY, AND I'M GLAD THAT WE'RE BRINGING IT FORWARD
THANK YOU, COMMISSIONER CALKINS
COMMISSIONER CHO, YEAH
I DON'T HAVE ANY QUESTIONS
I JUST WANTED TO TAKE A SECOND TO REALLY COMMEND THE WORK OF ALL OUR RELATIONS TEAM
THIS IS NOT AN EASY LIFT
ALL THAT WE ACCOMPLISHED IN OLYMPIA, THIS SESSION HAPPENED IN THE MIDST OF A REMOTE SESSION WHERE WE DIDN'T GET ANY REAL FACE TIME WITH LEGISLATORS IN PERSON
SO I REALLY WANT TO COMMEND YOUR TEAM NATE, ERIC FITCH AND EVERYONE ELSE WHO WORKED REALLY HARD TO MAKE ALL THIS REALITY
SO KUDOS TO YOU ALL AND I LOOK FORWARD TO NEXT SESSION
WORK NEVER STOPS
THANK YOU, COMMISSIONER CHO COMMISSIONER STEINBRUECK HAS LEFT THE MEETING
COMMISSIONER FELLEMAN, WELL, THANKS AGAIN
AND WE'D LOVE TO LOOK AT THAT CO-BENEFIT ANALYSIS, MAKE SURE THAT WE LOOK AT THE BENEFITS IN THE FORESTRY REGION AS WELL AS DIVERTING WASTE FROM THE LANDFILL
I HOPE WE CAN LOOK AT DIFFERENT CREDITS FROM THAT
BUT THIS CONCLUDES OUR PRESENTATION OF THE SAF STUDY SESSION, AND THERE'S OBVIOUSLY MUCH MORE WE CAN DISCUSS
AND I LOOK FORWARD TO CONTINUING THIS CONVERSATION TO REDUCE OUR IMPACT ON THE CLIMATE AND AIRPORT COMMUNITIES IN THE NEAR FUTURE
MANY THANKS AGAIN TO THE STAFF FOR PUTTING THE SESSION TOGETHER INTO OUR FANTASTIC PRESENTERS FOR JOINING US TODAY AND UPDATING US ON THE STATUS OF SUSTAINABLE AVIATION FUELS
THE PORT IS COMMITTED TO ATTACKING THE HARDEST CHALLENGES ASSOCIATED WITH GREENHOUSE GAS REDUCTION IN HEAVY ENGINES OF AIRPLANES AND TRUCKS
THESE FUELS ARE THE WAY TO MAKE THE FASTEST IMPROVEMENT ON THAT
AND SO I'D LIKE TO IN CLOSING TODAY, GIVES AN EXECUTIVE SESSION SOME OPPORTUNITY FOR PROVIDING SOME FINAL REMARKS
THANKS, PRESIDENT FELLEMAN
COMMISSIONERS, THANK YOU FOR SETTING ASIDE TIME TODAY FOR THIS TIMELY AND IMPORTANT SUBJECT
I WANT TO THANK ALL THE FANTASTIC PRESENTERS TODAY, ESPECIALLY STEPHANIE MEYN
THE PORT STAFF HAS PROVIDED INVALUABLE TECHNICAL AND STRATEGIC ADVICE TO US AS WE MOVE FORWARD MORE THAN EVER BEFORE
WE HAVE REASON TO BE FOR OPTIMISM ABOUT THE DEVELOPMENT OF SUSTAINABLE AVIATION FUELS
WE'VE HEARD FROM THE INDUSTRY LEADERS ABOUT THEIR GOALS FOR PURCHASING MORE SAF IN THE FUTURE AND THE POTENTIAL FOR CORPORATE PARTNERSHIPS TO INCREASE DEMAND FOR SAF PRODUCTION, AS WELL AS THE CHALLENGES AHEAD OF US
OF COURSE, THIS PAST WEEKEND ACTION BY WASHINGTON LEGISLATURE TO PASS THE LOW CARBON FUEL STANDARD WAS A CRITICAL STEP TO PUTTING IN PLACE THE INCENTIVES NEEDED TO SUPPORT SAF PRODUCTION HERE IN WASHINGTON, WHICH IS A KEY OBJECTIVE
AND WE DEEPLY APPRECIATE THE COMMISSION'S LEADERSHIP ON THIS IMPORTANT LEGISLATION, BUT IMPORTANT LEADERSHIP ON THIS ENTIRE TOPIC
I'M ALSO ENCOURAGED BY THE LEADERSHIP OF THE BIDEN ADMINISTRATION TO COMBAT CLIMATE CHANGE AND TO ACHIEVE A FUTURE WHERE WE NO LONGER ARE DEPENDENT ON FOSSIL FUELS
AND OF COURSE, AS WE'VE HEARD, WE CAN STEP UP OUR EFFORTS AT THE FEDERAL LEVEL TO SUPPORT THOSE ACTIONS
WE CAN ALL BE PROUD OF THE PORT OF SEATTLE LEADERSHIP ON REDUCING HARMFUL EMISSIONS, PROTECTING THE ENVIRONMENT, AND CREATING CLEAN ENERGY JOBS IN OUR REGION
OF COURSE, WE ALSO HAVE HEARD THERE'S A LOT OF WORK AHEAD OF US, AND WE LOOK FORWARD TO WORKING WITH YOU AND ALL THE STAKEHOLDERS ON ADVANCING THIS IMPORTANT WORK
SO, COMMISSIONERS, THANK YOU VERY MUCH FOR YOUR LEADERSHIP ON THIS IMPORTANT ISSUE
AND I WOULD LIKE TO CONCUR WITH EXECUTIVE METRICS COMMENTS AND REALIZE THE REASON WHY OUR STAFF HAVE THE ABILITY TO DO THIS IS BECAUSE HE'S GIVING THEM THE LEADERSHIP TO ALLOW THEM TO PURSUE THESE THINGS FULL THROATED LY AND SO, KNOWING THAT WE HAVE AN EXECUTIVE SESSION STARTING IN 25 OR IN 20 MINUTES, FOLLOWED BY A FULL DAY OF COMMISSION MEETING, I WOULD ASSUME THAT MY COLLEAGUES WOULD LIKE TO TAKE A MOMENT BREAK
BUT IF THERE ARE ANY CONCLUDING COMMENTS I WILL BE HAPPY TO ENTERTAIN THEM BRIEFLY A CARD, PLEASE
AND CHECK IF THAT'S THE CASE
CERTAINLY
I DON'T SEE ANY HANDS RAISED
COMMISSIONER BOOM AND CLOSING COMMENTS
NO, THANK YOU
THANK YOU
TO MR CALKINS
NO, THANK YOU, MISTER TO POSITION OF ELEMENTS
I THINK IT'S BACK TO YOU, OKAY
HAVING NO FURTHER BUSINESS
THE TIME IS CURRENTLY 11:08
THANK YOU, EVERYONE
AND WE ARE NOW ADJOURNED
WELL DONE
THANK YOU
WELL DONE
THANK YOU.

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