Southwest Airlines Secures Illinois’ Largest Sustainable Aviation Fuel Deal for Chicago Midway Operations

Supply from Valero is expected to deliver the highest volume of SAF announced to date in Illinois

(IN SHORT) Southwest Airlines has signed a significant sustainable aviation fuel (SAF) agreement with Valero Marketing and Supply Company to bring SAF to Chicago Midway International Airport. The deal, the largest of its kind in Illinois, includes an initial purchase of at least 3.6 million gallons of neat SAF, with the option to buy up to 25 million gallons over two years. The SAF, derived from waste-based feedstocks, will help reduce greenhouse gas emissions by up to 84% compared to conventional jet fuel. This partnership aligns with Southwest’s goal of achieving net zero carbon emissions by 2050 and benefits from Illinois’ SAF tax credit program.

(PRESS RELEASE) Dallas, TX, 2024-Oct-18 — /Travel PR News/ — Southwest Airlines Co. (NYSE: LUV) has announced a landmark sustainable aviation fuel (SAF) agreement with Valero Marketing and Supply Company, a subsidiary of Valero Energy Corporation (NYSE: VLO). This partnership brings SAF to Chicago Midway International Airport (MDW) in what is the largest SAF supply agreement announced in Illinois to date.

Under the two-year agreement, Southwest will initially purchase at least 3.6 million gallons of neat SAF, with the potential to acquire up to 25 million gallons over the term, potentially blending to about 84 million gallons of fuel. This would account for as much as 35% of the carrier’s jet fuel usage at Midway based on the previous year’s consumption. The SAF is derived from waste-based feedstocks such as used cooking oil, animal fats, and corn oil, offering a reduction in lifecycle greenhouse gas emissions of 74% to 84% compared to conventional jet fuel.

Governor JB Pritzker expressed his support for the agreement, emphasizing Illinois’ leadership in sustainability and clean energy initiatives. He highlighted the state’s SAF tax credit, which has helped drive adoption of sustainable fuels in aviation. U.S. Senator Tammy Duckworth also praised the deal, underscoring the importance of increasing SAF supply to support domestic agriculture and reduce the aviation industry’s carbon footprint.

Produced by Diamond Green Diesel, a joint venture between Valero and Darling Ingredients, the SAF will be blended with conventional jet fuel and distributed through existing pipelines. Southwest’s Corporate Customers will have the opportunity to support SAF use as part of the airline’s long-term sustainability initiatives, including its goal to reach net zero carbon emissions by 2050.

Michael AuBuchon, Managing Director of Fuel Strategy at Southwest, noted the agreement as a significant milestone in the airline’s sustainability journey, thanking Illinois for making the SAF Purchase Credit available and praising the collaboration with corporate partners to scale SAF use.

For more on Southwest’s sustainability efforts and the path to net zero emissions, visit southwest.com/planet.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Specific forward-looking statements include, without limitation, statements related to (i) the Company’s plans and expectations associated with the purchases of sustainable aviation fuel (SAF); (ii) the Company’s plans and expectations with respect to the usage of SAF in operations and associated timing of usage; (iii) the Company’s expectations with respect to jet fuel usage at Chicago Midway; (iv) the Company’s expectations with respect to the production of SAF; (v) estimates of greenhouse gas emission reductions; (vi) expectations related to certification of the SAF; (vii) expectations regarding supply, blending, and delivery of SAF; and (viii) the Company’s expectations with respect to scaling SAF and meeting long-term sustainability goals. Forward-looking statements involve risks, uncertainties, assumptions, and other factors that are difficult to predict and that could cause actual results to vary materially from those expressed in or indicated by them. Factors include, among others, (i) any negative developments in any phase of business development, including limitations on the availability of feedstock, transportation, and refinery availability; (ii) the continuation of government support for Valero’s and Diamond Green Diesel objectives and renewable fuels generally, including SAF; (iii) the Company’s dependence on third parties, in particular with respect to fuel supply, technology licensing, environmental sustainability, and the production, transport, storage, blending, and distribution of SAF, and the impact on the Company’s goals and plans of any third party delays or non-performance; (iv) the Company’s ability to timely and effectively prioritize its focus areas and initiatives and related expenditures, including its ability to implement and maintain the necessary processes to support the utilization of sustainable aviation fuel; (v) the consequences of competition with other existing and new sources of aviation fuel, whether or not sustainable; (vi) the ability to obtain and protect intellectual property rights relating to the development and commercialization of technology, including with respect to converting feedstocks to SAF; (vii) the impact of governmental regulations and other governmental actions on the Company’s business plans and operations, including with respect to carbon emissions, SAF, SAF tax credits, environmental compliance requirements, and other sustainability matters; (viii) the impact of fears or actual outbreaks of diseases, extreme or severe weather and natural disasters, actions of competitors, consumer perception, economic conditions, fuel prices, socio-demographic trends, and other factors beyond the Company’s control, on the Company’s business plans, expectations, and goals; (ix) the impact of fuel price changes, fuel price volatility, volatility of commodities used by the Company for hedging jet fuel, and any changes to the Company’s fuel hedging strategies and positions, on the Company’s business plans and results of operations; and (x) other factors, as described in the Company’s filings with the Securities and Exchange Commission, including the detailed factors discussed under the heading “Risk Factors” in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, and in the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2024. Caution should be taken not to place undue reliance on the Company’s forward-looking statements, which represent the Company’s views only as of the date this release. The Company undertakes no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.

ABOUT SOUTHWEST AIRLINES CO.   
Southwest Airlines Co. operates one of the world’s most admired and awarded airlines, offering its one-of-a-kind value and Hospitality at 117 airports across 11 countries. Southwest took flight in 1971 to democratize the sky through friendly, reliable, and low-cost air travel and now carries more air travelers flying nonstop within the United States than any other airline1. Based in Dallas and famous for an Employee-first corporate Culture, Southwest maintains an unprecedented record of no involuntary furloughs or layoffs in its history. By empowering its more than 74,0002 People to deliver unparalleled Hospitality, the maverick airline cherishes a passionate loyalty among more than 137 million Customers carried in 2023. That formula for success brought industry-leading prosperity and 47 consecutive years3 of profitability for Southwest Shareholders (NYSE: LUV). Southwest leverages a unique legacy and mission to serve communities around the world including harnessing the power of its People and Purpose to put communities at the Heart of its success. Learn more by visiting Southwest.com/citizenship. As the airline with Heart, Southwest has set a goal to work toward achieving net zero carbon emissions by 20504. Southwest has also set near-term targets and a three-pillar strategy to achieve its environmental goals. Learn more by visiting Southwest.com/planet.

1. Based on U.S. Dept. of Transportation quarterly Airline Origin & Destination Survey since Q1 2021
2. Fulltime-equivalent active Employees
3. 1973-2019 annual profitability
4. Our net zero by 2050 goal includes Scope 1, Scope 2, and Scope 3 Category 3 emissions only and excludes any emissions associated with non-fuel products and services, such as inflight service items.

Media Contact:

Visit the Southwest Newsroom at swamedia.com for multimedia assets and other Company news.

Media Relations Team: 214-792-4847, option 1

Source: Southwest Airlines

###

Subscribe to Notifications