Microsoft, working with Alaska Airlines, will begin purchasing sustainable aviation fuel (SAF) for employee travel between its Seattle-area headquarters and Los Angeles, San Francisco and San Jose, Calif. The routes are the three that are most commonly flown by employees of the tech giant.
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Under the arrangement, Microsoft will purchase SAF credits from Amsterdam-based SAF distributor SkyNRG, which will then deliver the fuel to the Alaska Airlines airport fueling system. The fuel, which derives from waste oil, is produced in Southern California by Los Angeles-based World Energy. SAF delivers a carbon reduction of approximately 75% compared to traditional kerosene-based jet fuel.
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The SAF agreement is the first of its kind between a U.S. corporation and a commercial airline, the companies said.
"We hope this sustainable aviation fuel model will be used by other companies as way to reduce the environmental impact of their business travel," Judson Althoff, executive vice president of Microsoft's Worldwide Commercial Business, said in a statement.
The airline industry has pledged to reduce emissions 50% from 2005 levels by 2050. IATA estimates that annual production of SAF is currently 13 million gallons, a tiny fraction of the approximately 80 billion gallons per year of fuel that airlines were using prior to the Covid-19 pandemic.
IATA would like to see production increase to 1.8 billion gallons by 2025, the quantity it says would be a tipping point at which prices drop and purchases snowball.