What is the benefit or value you're creating for your business?
Sustainable fuels are an essential part of our Change is in the Air (CIITA) sustainability programme and align closely with our company values, which are also of significant appeal to our customers. In addition, they make good business sense in that they offer the opportunity to: provide affordable low-carbon fuels; take some of the volatility out of escalating and significant fuel costs; provide fuel security; and lower our exposure to carbon taxes and other penalties, therefore improving Virgin Atlantic’s competitive position.
How are you leveraging internal resources (funds, time, knowledge, etc.) to support this initiative?
I spend about 50% of my time on our sustainable fuels programme, as it’s by far our biggest priority. I also work very closely with our Sustainability Strategy Group, which provides high-level governance to our wider Change is in the Air Sustainability Programme, and is led by our Chief Commercial Officer (second in command in the business) and includes most of our Directors and other key senior managers. This gives us much of the support we need to make the fuels’ programme work. For that, I collaborate with all our key departments, e.g. we have invaluable input from our Heads of Fuel Management and Procurement, and from our Engineering Director – all of whom are essential to this programme. Many people across the business are very excited by, and supportive of, the possibilities.
Expand on your answer, explaining the long-term funding and support plan.
The aviation sector is very lean financially, and fuel represents a high proportion of operating costs. This means airlines alone cannot fund the development of a new fuels market. Also, any new fuels need to be affordable. We can leverage our role as a leading brand and buyer of sustainable fuels, to demonstrate that a market exists and stimulate investment (as we’ve done with LanzaTech). To go bigger, we’re working with CWR to identify other suppliers (those that are truly sustainable and scaleable), and with other airlines to demonstrate wider demand (e.g. SAFUG members). Getting a new market started also needs investors, policy makers and scientists among others. Crucially, we need to encourage financers to inject money into the right places, so that we can make this happen.
Tell us about your partnerships across your company and externally that are key to your project's success.
From our Chairman Sir Richard Branson who describes LanzaTech as “one of the most exciting developments of our lifetime and a major breakthrough in the war on carbon”, to the CWR (see accompanying videos), to our Executive team and senior managers, Virgin Group, airline members of SAFUG, scientists (we collaborate with Imperial College London), NGOs (the Carbon War Room, RSB), policy makers in the UK, EU and beyond, and essentially, the finance community.
What internal support have you gotten for your project? What kind of push-back have you received?
Internal support for the programme is described above. The biggest challenges we have are that fuels need to be affordable (at least on a par with kerosene costs) and that airlines are not in a position to fund a new supplier market themselves. Instead, we must go where the money is, using our brand and access to expertise and leverage support. In short, any initiatives must make business sense – they must be developed in the real and challenging world of aviation.