American Airlines invests $100mn in clean energy catalyst

American Airlines (AA, Dallas/Fort Worth) is investing USD100 million to become one of seven anchoring partners in Bill Gates’ non-profit group Breakthrough Energy Catalyst (BEC) initiative dubbed a “groundbreaking” collaborative effort to accelerate the clean energy technologies necessary for achieving a net-zero economy by 2050.

BEC so far has raised USD1 billion and also includes investments by the Bank of America, BlackRock, Boston Consulting Group, Microsoft, ArcelorMittal, and General Motors. Other companies are expected to join the initiative. Launched in June, BEC has already forged partnerships with the European Commission, the European Investment Bank, and the US Department of Energy.

The idea is to support the development of new energy solutions to combat climate change by bringing together the public and private sectors to fund, produce, and buy new solutions that will underpin a zero-carbon economy but are currently more expensive than their existing fossil-fuel emitting counterparts. The difference between these costs is what is referred to as the “Green Premium.”

By becoming an anchoring investor, American in a statement said it was backing up its climate commitments with concrete action to accelerate the development of pivotal emissions-reduction solutions like sustainable aviation fuel (SAF).

“We see immense promise in the mission of Breakthrough Energy Catalyst, and our investment is a vote of confidence in the difference-making potential of this unique and collaborative approach,” said chairman and chief executive officer Doug Parker. “We have an ambitious vision of a low-carbon future for our airline and a plan to match, but we know our own efforts can only get us so far. By working in partnership with BEC, we’re helping accelerate and scale our industry’s nascent solutions, like sustainable aviation fuel, along with other technologies that will be necessary to reduce emissions from aviation and across the economy,” he added.

“Avoiding a climate disaster will require a new industrial revolution. We need to make the technologies and products that don’t cause emissions as cheap as those that do, so the whole world can afford to put them to use,” commented Gates, who founded Breakthrough Energy. “BEC will focus on supporting technologies that are vital to the world reaching net-zero emissions but are currently too expensive to be adopted at scale. By coordinating investments and directing them toward these critical technologies, we can reduce their Green Premiums and help them get to market faster, so we can all reach our climate goals.”

BEC will start by funding projects across four technologies: sustainable aviation fuel, green hydrogen, direct air capture, and long-duration energy storage.

The airline said its partnership with BEC would augment its ongoing efforts to advance SAF and bring the market to scale. Its plan to reduce its emissions relies in large part on using SAF in increasing volumes over time. The airline has taken delivery of SAF from Neste for more than a year and has committed to using 34 million litres in total by 2023. Additionally, American has agreed to terms to purchase up to 37 million litres of carbon-neutral SAF produced by Prometheus Fuels.

American is also investing USD24 billion in modernising its fleet with 600 new and more fuel-efficient aircraft while retiring a similar number of less-efficient aircraft.