Virgin Atlantic - Change is in the Air! - Steve Ridgway, Chief Executive, Virgin Atlantic Green Aviation 28th June 2012
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Virgin Atlantic – Change is in the Air! Steve Ridgway, Chief Executive, Virgin Atlantic Green Aviation 28th June 2012
Agenda
― Aviation and the sustainability challenge
― Virgin Atlantic’s Sustainability Programme
‘Change is in the Air!’
― Good governance
― Fuel efficiency and the role of technology
― Sustainable aviation fuels
― Sustainability on the ground
― Supporting communities in the UK and abroad
― The role of stakeholders
― Industry, governments, consumers and NGOs
― Q&A
The sustainability challenge… ― No escaping the facts… ― Aviation is energy intensive ― Small, but growing % of global CO2 is cause for concern ― Rightly at the heart of global climate change debate ― >99% of Virgin Atlantic’s Scope 1 and 2 emissions from our aircraft operations
There is a flip side…
― Part of modern life: connects Aviation
business, families, communities Land use
2% Shipping
4%
change Other
― UK aviation contributes £49.6 24% transport
12%
billion (3.6%) to UK GDP alone*
― Virgin Atlantic Group
― UK’s 12th largest private company
Industry
― 10,800 jobs in UK + overseas 16%
― 2010/11 revenue was £2.8 billion Other fuel
10%
― 1/3 ticket sales overseas
= £1 billion exports for the UK
economy Electricity &
heating
― 5.3 million passengers in 2010 32%
paid £149.5 million in APD to UK
Treasury
*Oxford Economics, Economic benefits from air transport in the UK, 2011, p.4
Worldwide contribution
Images reproduced from ATAG Aviation Benefits Beyond Borders 2012 Report
Industry position is to take action
― Responding actively to carbon
challenge
― Committed to reducing carbon
― Worldwide focus
― IATA June 2009 targets agreed
― Industry pursuing range of
options…
2009 IATA targets. (Image reproduced from ATAG
Aviation Benefits Beyond Borders 2012 Report)
How will we get there?
Image reproduced from UK’s Sustainable Aviation Roadmap 2012
Reductions to be achieved by…
1. Technology improvements
2. ATM & operational improvements
3. Commercialisation of sustainable
aviation fuels
4. Global market based measures
Technology: Aircraft efficiencies (Boeing)
MORE FUEL HIGHER
Early jet airplanes
DECIBELS
90% Reduction in noise footprint
Relative fuel use
70% Fuel improvement and reduced CO2
Noise dB
LOWER
LESS FUEL DECIBELS
New generation jet airplanes EVEN
EVEN LESS LOWER
1950s 1990s
Noise footprint based on 85 dBa.
Copyright © Boeing. All rights reserved.
Aircraft efficiencies (Airbus)
Relative fuel burn per seat
100%
80%
-70%
60%
40%
20%
0%
1950 1960 1970 1980 1990 2000 2010 2020
Fuel burn reduced by 70% since the birth of the jet airliner
21 mpg for a 1908 Model T Ford …. and the average US car in 2008
Data sources: Ford website U.S. EPA figures
Copyright © Airbus S.A.S. All rights reserved. Confidential and proprietary document50 years of engine improvements
Flight Safety Thrust to Weight
90% 350%
improvement increase
1940 1960 1980 2000 1940 1960 1980 2000
Fuel Efficiency Engine Noise
45% 35 db
improvement decrease
1940 1960 1980 2000 1940 1960 1980 2000
Copyright © GE. All rights reserved. Confidential and proprietary documentAir Traffic Management (ATM)
― Work with NATS to test
ATM system changes.
― Better flying practices, e.g.
‘Perfect Flight’ trials with
Sustainable Aviation.
― Driving governments and
EC to implement Single
European Sky (SES)
― Potential for 15-20%
savings in fuel/CO2
― NextGen in US to deliver
similar benefitsFly like a bird
Fly like a bird
Global Market Based Measures (MBMs)
― Virgin Atlantic long supported of EU ETS
― Short term solution on way to global scheme
― But governments and EC must address
serious threat of retaliatory action from other
countries & competitive distortion
― Virgin founding member of AGD
― Supports global carbon cap and trade system
for aviation
― Most carbon- and cost-effective solution
― ICAO currently reviewing global schemes
― With support from IATABut unilateral measures…
― UK aviation facing increasing financial
burdens
― Highest taxes in Europe (APD)
― UK 134/138 on taxes & airport
charges worldwide
― Taxation is a blunt instrument
― Less environmentally- and cost-effective
― Affects UK competitiveness and leads to carbon
leakage as people opt for cheaper routeswww.virgin-atlantic.com/changeisintheair
Change is in the Air!
― Chairman’s values & drive
― Chief Executive leadership
― Sustainability Strategy Group (SSG)
― Chaired by CCO, all Directors + some
“We want our passengers to feel
Senior Managers, quarterly meetingssure that we are making every
― Ownership: planning, delivering, effort to become the most
embedding sustainable airline in the world,
― Sustainability team and to reduce the impacts of
― Strategy, guidance and advice to SSG
aviation on our environment.
― Reviewing, planning, monitoring,
While we know we still have lots to
reporting, engaging. do, we’re working hard on a range
of changes across the business.”
― Development of focused new projects
Steve Ridgway, Chief Executive,
― Employee engagement Virgin AtlanticChange is in the Air!
― Change is in the Air: 2 main
workstreams
― Environment
― Communities
― Also suppliers and Sustainable
Design and Buying Programme
(business-wide)Why ‘Change is in the Air’? Business wide, about changing… ― the way we engage with customers, communities, suppliers ― how we get our staff involved ― how we work with our industry partners ― above all, how we fly our planes in a low carbon world
Inside the business ― In 2011, our carbon footprint was 4.6 million tonnes. ― >99% came from our aircraft emissions. ― In 2007, set target to reduce carbon by 30% for every passenger and cargo kilometre flown between 2007-2020. ― Here’s how ...
Major focus – new aircraft
― 2011 onwards
― New A330s up to 15%
more efficient per seat
than aircraft they are
replacing
― 3 flying
― 7 more to come
― 2014 onwards
― 787s up to 27% more
efficient per seat
― Further efficient fleet
planned beyond 2017Operational and maintenance
― Cross-departmental Fuel
Efficiency Governance
Group and Fuel Efficiency
Performance Group
― Maximising load factors
― Removing excess weight
― Aerodynamic maintenance
― Cleaning to reduce drag
― APU reduction
― New FMS to pinpoint next
fuel-saving opportunities20.0%
40.0%
60.0%
80.0%
0.0%
100.0%
FY02/03
84%
FY03/04
80%
FY04/05
81%
FY05/04
77%
FY06/07
76%
FY07/08
76%
FY08/09
77%
FY09/10
80%
FY10/11
82%
FY11/12
78%
FY12/13
78%
FY13/14
79%
FY14/15
80%
FY15/16
81%
FY16/17
82%
FY17/18
82%
FY18/19
83%
So how are we doing? Load factors
FY19/20
84%
FY20/21
84%
FY21/22
84%
FY22/23
84%
FY23/24
84%How are we doing? CO2 per RTKs
1.000
0.946 0.953 Baseline
0.921
0.890
0.860
0.844
0.800 0.840
0.826
0.812
0.766
0.721 Target
0.676
0.600 0.630 0.627 0.624 0.620 0.617
0.400
0.200
-
FY16/17
FY07/08
FY08/09
FY09/10
FY10/11
FY11/12
FY12/13
FY13/14
FY14/15
FY15/16
FY17/18
FY18/19
FY19/20
FY20/21
FY21/22
FY22/23
FY23/24Sustainable aviation fuels ― Key Virgin focus ― Finding alternative ways to power aircraft ― First industry biofuel flight Feb 2008 ― Founding member of SAFUG (Sustainable Aviation Fuel Users Group) ― Supporter of RSB ― Oct 2011 LanzaTech low carbon fuel announcement
Sustainable aviation fuels ― Press announcement video
Sustainable aviation fuels challenge
― Liquid drop-in fuels needed for aircraft
― Committee on Climate Change supports
reserving drop-in fuels for sectors like ours
― Sustainable fuels to avoid earlier
mistakes (food, water, land competition)
― RSB: robust, international, multi-stakeholder
standard
― Commercialisation challenge
― New market, many early-stage suppliers
― Currently competing with ground transport
― Partnering with Carbon War Room (CWR) to
encourage commercial solutionsIt’s not just about flying – on the ground…
Ground transport
― 2007 carbon footprint of
UK ops (Carbon Trust)
― 42% of our ground ops
emissions came from staff
travel to and from work.
― Range of staff travel
incentives
― New car & commercial
fleet, 2009-11
― 27% carbon savings
― 40% increase in fuel
efficiency VW up!Waste ― Reduced ground waste by 29% between 2008-2011. ― Recycled 68% ― Many initiatives ― Stationery and furniture re-used ― Dry mixed recyclables (DMR) ― Waste food to energy ―Aircraft waste is bigger challenge (most not directly managed by us), but recycle ― Amenity kits and blankets ― Crew uniforms (inc buttons!)
Community Investment Programme
― Fundraising
― Staff volunteering and fundraising
― Change for Children onboard collections
― 2010+ ongoing partnership with inspirational
Canadian charity Free the Children (FTC)
― UK School Programme
― International development programme
― Other, e.g.
― Emergency relief (flights, cargo)
― Dealing with lots of requests – prioritise children’s
charities
― New human trafficking initiative – first UK airlineFundraising
Free The Children (FTC) 2010 -
UK School Programme
― Educate and empower
young people to take action
on key social and
environmental issues – local
to global
― Provide skills, training &
support to become social
entrepreneurs and
campaignersFTC UK School Programme
― 71 schools Yr 1, 94 Yr 2
― 26+ counties
― Up to 16,000 students p.a.
‘whole school’ motivational speech
― Up to 2,800 leadership training p.a.
― 28 visit Kenya project Yrs 1 and 2
― Highly rated
― 94% students rate 8+/10
Ian (Deputy head teacher of a high school in South West London):
“ I have worked in youth enterprise for fifteen years, but have never seen it
facilitated this well, with such tangible results in such a short time.”FTC International Programme
― Developing countries
already experiencing climate
change effects
Reduced access to water
Extreme climatic events
― ‘Adopt a Village’ in India,
China, Ghana and Kenya to
support 4 pillars:
Water and sanitation
Education
Healthcare & wellbeing
Alternative income projects
― Towards self-sufficiency
• Approx 5 yearsAnd finally… role of other stakeholders
― Governments to
― Push for global carbon cap and trade system as much more
environmentally- and financially-effective tool than taxation
― Provide policy and financial incentives to scale affordable,
sustainable fuel solutions
― from lab, to pilot, to demo, to commercial
― Academics to
― Develop sustainable, commercially-viable technologies
― Finance community to
― Provide investments to viable suppliers, to scale up
― NGOs to
― support robust sustainability principles for aviation fuels and
encourage the right kinds of developmentSummary
― Aviation industry actively involved in
addressing carbon challenge
― Virgin Atlantic
― At forefront of industry initiatives
― Aviation Global Deal (AGD)
― UK’s Sustainable Aviation (SA)
― Sustainable Aviation Fuel Users’ Group
(SAFUG)
― Carbon War Room
― Effective internal programme
― Need other stakeholders to actively
participate in finding solutionsFor more information
― www.virgin-atlantic.com/changeisintheair
― Download our latest Sustainability Report
― environment@fly.virgin.com
― community.investment@fly.virgin.com
― THANK YOU
― Q&AYou can also read
