Turbulence Ahead for United Airlines as the Globe Warms
Evidence is building that climate change will have a dramatic effect on the airline industry in the coming years. Is United Airlines changing rapidly enough to avoid a bumpy ride?
The airline industry is an important contributor to CO2 emissions worldwide, and until recently it has avoided some of the most serious repercussions of emissions-driven climate change. Yet evidence is mounting that the industry writ large will likely suffer significant physical and regulatory consequences in the coming years. (1) Airlines are beginning to take strides to address the root causes of climate change as well as stave-off some of the potential impacts, and one company in particular, United Airlines, has adopted a multifaceted approach. However, it is unclear if United is doing enough to avoid more difficult times ahead.
Recent studies indicate that the physical manifestations of climate change will have a significant impact on airlines such as United in the coming decades. A study published in 2016 found that doubling the total amount of CO2 in the atmosphere (which will occur by 2050 at current rates) could result in an acceleration of the jet stream by up to 15%, thus increasing flight times as a result of stronger headwinds and more frequent turbulence. This could potentially cost in millions of dollars in aircraft maintenance and greater fuel consumption. (2) Climate change is also likely to negatively impact the amount of cargo and passengers that can travel on a given aircraft. As average airfield temperatures increase, the maximum allowable takeoff weight of an aircraft decreases due to reductions in air density. A Columbia University study found that for a Boeing 737-800 aircraft, the most common in United’s fleet (3), the number of weight restriction days between May and September may triple by 2050-70. (4)
United Airlines will also face increased environmental regulations in the coming years. In 2015, the Environmental Protection Agency (EPA) laid the foundation for emission regulations on the airline industry through an official statement linking air travel to climate change. (5) It is still unclear what form these measures will take, but the finding that jet exhaust posed a public threat removed a key roadblock to increased regulation. (6)
United Airlines is taking steps in several areas in order to mitigate the negative consequences of warming temperatures on the company. The first area can be categorized as operational improvements and consists of incremental changes to existing systems. One example is weight optimization on aircraft, where lighter-weight alternatives are implemented wherever possible across United’s fleet. United has also implemented streamlined crew checklists to reduce taxi times and routine engine washes to reduce drag. (7) The second area of focus is on technological improvements, particularly with respect to aircraft design and new engine procurement. New aircraft winglets have boosted fuel efficiency by 3-5%, and the company is acquiring advanced aircraft with greater fuel efficiency such as the Boeing 787 and Airbus A350. (8) Overall, United’s goals include a 1.5 percent per year increase in average fuel efficiency until 2020, and a stabilization of emissions thereafter.
While these initiatives have shown incremental improvement, they are likely to be insufficient to address the challenges United Faces as a result of climate change in the coming decades. First, the company’s yearly fuel savings as a result of operational improvements are still more than offset by the growth in air travel each year. In 2015, operational improvements saved 12.4 million gallons of fuel (approximately 1.6 percent of the total), yet total fuel consumption reported in the company’s financials still rose by 15 million gallons. Second, while United’s goals comply with industry standards concerning emissions, EPA regulations are likely to be more stringent and will require more aggressive targets in coming years. Finally, while the company is acquiring advanced airframes, the bulk of its purchases are still older models such as the Boeing 737.(9) These aircraft have a long lifespan (averaging approximately 20 years) and will not be easily replaced by new variants. Furthermore, a 2005 study from the National Aerospace Laboratory in the Netherlands concluded that technological improvements in jet engines will result in limited overall improvements in efficiency in coming years (see chart). New aircraft are therefore only a small piece of a much more complex puzzle in boosting efficiency.
(10)
There are no easy solutions to the problems United is likely to face as a result of climate change, and the way forward will need to include a blend of current programs and new initiatives. United should continue operational improvements to boost efficiency but also needs to partner with governments and international agencies to smooth industry-wide inefficiencies. One area in clear need of improvement is the antiquated Air Traffic Control system. Relying heavily on ground-based stations and voice communication, this system increases flight times and exacerbates delays. (11) United should also continue to support the internationalization of environmental regulation by working with agencies such as the International Civil Aviation Organization to ensure that regulations are applied evenly across industry competitors. (799 Words)
References:
- “Climate Change; Air Transport Association Welcomes International Civil Aviation Organization Broadened Framework for International Aviation and Climate Change.” Energy Business Journal, 29 October 2010. Accessed via ProQuest 30 October 2016.
- “Climate Change will delay Transatlantic Flights.” Journal of Transportation, 27 February, 2016. Accessed via ProQuest 30 October, 2016. See also Williams, Paul, and Manoj Joshi. “Intensification of winter transatlantic aviation turbulence in response to climate change.” http://www.met.reading.ac.uk/~williams/publications/nclimate1866.pdf. Accessed 30 October, 2016.
- http://www.airfleets.net/flottecie/United%20Airlines.htm, Accessed 30 October 2016.
- Coffel, E., and Horton, R. “Climate Change and the Impact of Extreme Temperatures on Aviation.” American Meteorological Society Journals. 28 October 2014, http://dx.doi.org/10.1175/WCAS-D-14-00026.1, Accessed 30 October 2016.
- Ostrower, Jon. “EPA Takes aim at Airline Emissions; Finding concludes aircraft carbon emissions contribute to climate change.” Wall Street Journal (Online), 10 June 2015. Accessed via ProQuest 30 October, 2016.
- “EPA ruling on aircraft emissions paves way for new regulations.” Guardian (Online), 26 July 2016. Accessed 30 October, 2016.
- United Website: Fuel efficiency and carbon footprint management. https://www.united.com/web/en-US/content/company/globalcitizenship/environment/fuel-efficiency-and-carbon-footprint.aspx. Accessed 30 October 2016.
- “United fourth-quarter and full-year 2015 financial results.” http://newsroom.united.com/2016-01-21-United-Airlines-Announces-Full-Year-2015-Profit?printable. Accessed 30 October 2016
- Ibid.
- Peeters, PM., Middel, J., Hoolhorst, A., “Fuel Efficiency of Commercial Aircraft, an Overview of Historical and Future Trends.” National Aerospace Laboratory. November 2005. http://www.transportenvironment.org/sites/te/files/media/2005-12_nlr_aviation_fuel_efficiency.pdf. Accessed 30 October, 2016.
- For more on this, see: Mills, Gordon. The Airline Revolution: Economic Analysis of Airline Performance and Public Policy. Routledge, 15 July 2016.
I very much like your post about airlines, as I had never thought about the potential impacts you mentioned.
I would just like to share that my perception is slightly different regarding where United should focus.
Clearly, operational improvements and internal initiatives could help – as well as the conversation with governments and international agencies. However, I think the greatest potential lies on integrating the entire airline industry value-chain in a coordinated effort to counter climate change. United could spearhead the creation of an association of airlines, airplane manufacturers, service providers and even other players to propose more disruptive solutions to the problem. For instance, such an alliance could help manufacturers move even faster towards the design of more efficient airplanes, or even partner with academia to find innovative mechanisms to reduce airplane emissions. In my opinion, these associations have much more power than one single company – and thus are able to move the climate change agenda much more effectively. To illustrate, here is the link for the website (http://www.ceres.org/bicep) of an organization that Starbucks helped co-found, to congregate several different companies concerned about climate change and environmental impact. Maybe it could inspire United…
Another key area of focus for United that could help move the needle on sustainability and ultimately help lower costs (United spent $11.6 billion on 3.9 billion gallons of gas in 2014) is replacing conventional jet fuels with biofuels, which can lower CO2 emissions by 80%. In June 2015, United invested $30 million in biofuel producer Fulcrum Bioenergies and later that summer became the first US airline to fly a plane using fuel from animal fats and farm waste. The key challenge with biofuels is producing sufficient quantities at scale and reducing the costs of production. (Source: http://www.nytimes.com/2015/06/30/business/energy-environment/farm-waste-and-animal-fats-will-help-power-a-united-jet.html?_r=0) Several other airlines are also pursuing biofuels and those that most successfully replace conventional fuels with biofuels will have a competitive advantage, both from a carbon footprint standpoint and because they will be more insulated from fluctuations in oil prices.
I also wrote about aviation, but from the perspective of an aerospace design firm. The airlines can’t reduce the number of flights without sacrificing their core business, and they can’t better utilize capacity on those flights (most flights are full), so the only thing left is to try to design more fuel-efficient aircraft. I think your article points to this in a number of ways (lighter airframes, etc). At the end of the day, United’s only lever is to demand more efficient airplanes from their suppliers, and the greater their engagement is with companies like Boeing and Airbus, the better they will be able to meet regulations eventually passed by the EPA and reduce their climate impact.
Fascinating article MattM – while I would have intuited that airlines will face challenges in the future if a cost of carbon is imposed, I did not know about the potential physical impacts you discussed. A couple thoughts:
1) From my research on Maersk and the maritime shipping industry, I learned that the airlines contribute around 1% of total global CO2 emissions. This is significant and will grow as passenger-miles increase in emerging economies. I would contend that the size of this carbon reduction “prize” will make them a target for early regulatory action (for parallel, see incrase in fuel economy standards in passenger vehicles in the US).
2) I agree with airline’s incremental approach to the emissions reductions. In addition to the items you mention, some airlines taxi under the power of only one engine to reduce fuel consumption and therefore emissions. The “winglets” you see on newer airplanes are also a fuel savings tactic. While each of these incremental improvements may seem to make an insignificant reduction in emissions, their collective impact is significant.
3) Unlike some of climate change’s more intractable challenges, in this case the airline’s economic incentives are aligned with emissions reductions. With fuel being airlines most significant operating expense, much of their continuous operational improvement focus in on reducing this cost and therefore emissions.