Fly the (climate) friendly skies? Delta is having second thoughts

Delta Air Lines has quietly backed away from its pledge to use 10 percent sustainable aviation fuels (SAFs) by 2030, citing the lack of available supplies of this supposedly climate-friendlier alternative to conventional jet fuel. Prices that are 2 to 5 times higher may have also been a factor. This move represents another step

Like fuels mandated for cars and trucks under the Renewable Fuel Standard, SAFs are agricultural or other non-petroleum derived alternatives to conventional fuel refined from oil. Though not mandated like corn ethanol and other renewable fuels under the Renewable Fuel Standard, SAFs enjoyed generous tax credits, now expired, of $1.25 to $1.75 per gallon, based on calculations of their climate friendliness relative to conventional aviation fuel. SAF production facilities have also received federal and state subsidies. Many are owned by the same companies benefiting from the Renewable Fuel Standard, and they enjoy the same political support from Midwestern members of Congress.  

Although air travel accounts for only 2.5 percent of global carbon dioxide emissions, the industry has not escaped the attention of the climate activist community. Green organizations have pressured both aircraft manufacturers and airlines to take action. The major airlines have embraced SAFs as a relatively painless way of appeasing them, at least compared to more draconian options such as tough cap and trade-style limits on flying. Delta was more bullish on SAFs than most other airlines, pledging to use fully 10 percent SAFs by 2030.

As with electric vehicles, wind energy, and other subsidy-dependent alternatives, reality is beginning to intrude on SAFs. Despite years of taxpayer-funded support, SAFs are still very difficult and expensive to produce. Even with the Iran war causing a jump in conventional jet fuel costs, SAFs are still uneconomic at scale. Numerous SAF production facilities are struggling to stay solvent. And Delta, for its part, only used a reported 0.5 percent SAFs last year, and was highly unlikely to boost that number to 10 percent by 2030.

In any event, the SAF strategy from Delta and other airlines never made much sense.  There never was any real constituency favoring SAFs. Most passengers just want a good flight at a good price – not climate crusading – and SAFs only add to costs. And many in the climate activist community have already moved back the goalposts and now assert that SAFs alone are not a sufficient substitute for harsher measures on air travel.  Some also question the environmental benefits of SAFs.

What Delta did is part of a welcome trend. Rationality is making a comeback on climate policy. We see other segments of the economy moving away from climate advocacy and refocusing on customers and shareholders. The airline industry should do the same, and perhaps Delta’s policy change is a bellwether.