Did you know that Delta Airlines owns its own fuel refinery? Yeah, neither did I, and now, according to a report published Friday by Reuters, that refinery could be getting ready to start making biofuels. That’s cool, but don’t expect your next 737 flight’s jet exhaust to smell like french fries.
It would seem that Delta’s move to start blending biofuels into its existing jet fuel blends is more of a play to get out of paying for emissions compliance credits than changing how it fuels its planes. The U.S. Renewable Fuel Standard mandates that refiners blend ever-increasing amounts of biofuels into their products or else buy credits from refiners that do. These credits, as you might have guessed, aren’t cheap.
Delta’s refinery (aka Monroe Energy) — which it bought around a decade ago to save a little cash on fuel — will now be able to start selling credits to other refiners, which, if it’s anything like Tesla and its carbon offset credit sales, could prove to be a pretty lucrative sideline for the airline.
Monroe Energy has historically struggled to turn a profit under Delta’s ownership, and the company has attempted to sell it off on multiple occasions. That changed this year as Russia’s military action against Ukraine caused prices to soar, leading the refinery to make $323 million between January and June.
The decision to retrofit the refinery to make it capable of blending biofuels is a big one, necessitating the construction of two large tanks, with one of those tanks already built as of publication and the next one scheduled to be completed in October.
We attempted to reach Delta for comment but didn’t hear back in time for publication.