The lower carbon aviation fuel puzzle

By KAYLA GUO and ALEX DAUGHERTY

05/15/2023 10:00 AM EDT

Presented by

With help from Tanya Snyder

— Hydrogen aviation companies are pushing for a share of federal investments in lower-carbon aviation fuel — to a mixed reception.

— It's Infrastructure Week, and Biden administration officials are traveling the country to beat the drum on progress made since the infrastructure law was signed.

— The four biggest electric bike- and scooter-share companies in North America have a proposed plan for managing micromobility across cities.

IT’S MONDAY: You’re reading Morning Transportation, your Washington policy guide to everything that moves. I’m your host, Kayla Guo. Send tips, thoughts, song lyrics and recipes you like to [email protected]. Find us on Twitter @kaylaguo_, @alextdaugherty and @TSnyderDC.

"Celebrate good times, come on / Let's celebrate / There's a party going on right here / A celebration to last throughout the years."

A message from Regional Airline Association:

When it comes to aviation safety, how you train and what you train on matters. More pilots fail new-hire training than a decade ago because the 1,500-hour requirement does not ensure relevant experience. Pilots spend months away from training flying small, slow, single-engine aircraft in clear weather, and skills deteriorate. Academic flight training and simulation have advanced, but FAA's structured training pathways have been static since 2013. Safety means following the data. Learn more here.

HYDROGEN VS. SAF: The FAA bill presents an opportunity for Congress to spend millions (and possibly billions) on the development of lower-carbon aviation fuel. But sustainable aviation fuel, the solution that can get off the ground today (pun intended), comes with drawbacks. Hydrogen aviation companies want federal investments to be based on carbon outputs, where they perform better than SAF, which reduces emissions but doesn't eliminate them. And they also want the FAA's regulatory capacity expanded so the industry can innovate faster. Alex has more.

"We want a level playing field for novel technologies," said Val Miftakhov, CEO of ZeroAvia, which is developing hydrogen-powered commercial aircraft.

— But others in the aviation industry are skeptical about the viability of hydrogen, electric or other kinds of alternative fuels beyond SAF, which is sourced from cooking oil, solid waste, animal fats and other forms of waste. Critics argue that sources like hydrogen may never be scalable for larger commercial aircraft, and would require airplane engines to be redesigned even if they could. SAF, on the other hand, can be fed right into existing gasoline-powered engines, making it the airline industry's preferred option. In addition, many companies that produce sustainable aviation fuel sources, notably farms, have lawmakers’ ears.

— Ryanair Chief Financial Officer Neil Sorahan dismissed the commercial viability of hydrogen- and electric-powered commercial planes, telling reporters in Washington last week at an event unveiling a major purchase order between Ryanair and Boeing, "I’m not sure they will get there in my lifetime."

— SAF, however, is still a relative drop in the bucket. While production tripled last year to 15 million gallons, that accounts for just .08 percent of the 17.5 billion gallons of aviation fuel used in the last year by airlines. Airlines for America is aiming for airlines to use 3 billion gallons of SAF by 2030, a total that would represent 17 percent of all jet fuel used in 2022.

ONE YEAR LATER: It's Infrastructure Week, and the Biden administration is fanning out across the country to tout the progress it's made since President Joe Biden signed the bipartisan infrastructure law one year ago. Some highlights:

— The White House senior advisor and infrastructure coordinator, Mitch Landrieu, has a packed Tuesday: He’ll participate in the United for Infrastructure Steering Committee National Event, lead a gathering of the State Infrastructure Coordinators at the White House and speak at the Edison Congress 2023 Conference focused on North America's electric industry.

— USDA Secretary Tom Vilsack, White House Deputy Chief of Staff John Podesta and White House National Climate Adviser Ali Zaidi will host an event announcing the IRA's investment in rural electrification on Tuesday, too, and on Wednesday first lady Jill Biden will go to Bethel, Alaska, to plug infrastructure law investments in broadband connectivity in Indigenous communities, including Alaska Native communities. And closing out the week, FTA Administrator Nuria Fernandez will go to the groundbreaking for the new Potomac Yard Metro station on Friday. Here's the full calendar of events, which are hosted by nonprofit Accelerator for America Action.

A message from Regional Airline Association:

SCOOTERS, A HOW-TO GUIDE: The four biggest electric bike- and scooter-share companies in North America have come up with a proposed framework for cities looking to effectively manage micromobility. For example, they recommend setting a 15-mph speed limit and starting with one vehicle per 500 people in the city. They also have thoughts about when dockless parking works — lower-density areas, and with clear rules about no-parking zones in highly pedestrianized areas — and where parking corrals are better, like downtown areas.

GHOST OF DEBT CRISES PAST: Railroad workers saw their sick and unemployment benefits slashed by 5.7 percent last week in cuts that were put on pause for two years during the pandemic, and which were negotiated as part of the agreement to resolve the 2011 debt ceiling crisis, The Washington Post reports. The reductions come against the current backdrop of gridlock between the White House and House Republicans on raising the debt ceiling, and after labor groups were already frustrated with the Biden administration, if you’ll recall, for imposing a labor contract without paid sick leave in the fall.

BUYBACK TUSSLE: The U.S. Chamber of Commerce sued the SEC on Friday in a bid to block the Wall Street regulator's new stock buyback disclosure rule, which will force public companies to provide investors with more details about when they are buying back stock, how much and why, Declan Harty reports. The rule's finalization came on the heels of a surge in corporate buybacks, which have long been a point of concern for investor advocates and Democratic lawmakers who question whether it is the best use of a company's excess cash.

— If you remember, one of the restrictions for airlines receiving federal pandemic relief money is that they not engage in stock buybacks. So far, zero major airlines have announced plans to resume buybacks, though Southwest Airlines was the first major airline to bring back dividends late last year (just before its holiday meltdown). Democratic lawmakers also urged airlines not to resume buybacks after the restrictions tied to pandemic relief were lifted in October of last year.

AIR TRAVEL ON THE UP: U.S. airlines exceeded pre-pandemic international travel levels in February, setting a new all-time high of almost 10 million passengers — 1.7 percent over the previous record set in January 2020, according to new BTS data. U.S. airline traffic more generally, both domestic and international, is well on its way back to pre-pandemic levels, with February seeing system-wide traffic just 2.3 percent below January 2020's all-time-high and domestic traffic down just 2.8 percent from January 2020. The FAA and aviation industry, meanwhile, are gearing up for a summer travel season that's expected to resemble or exceed pre-pandemic levels.

PROGRAMMING ALERT: Don't miss POLITICO's first-ever energy summit on Thursday, which will feature speakers including Energy Secretary Jennifer Granholm, White House Infrastructure Coordinator Mitch Landrieu, Sen. Ed Markey (D-Mass.), Council of Economic Advisers member and Chief Economist of the Invest in America Cabinet Heather Boushey, and others. The summit will dig into the critical questions of how the U.S. is positioning itself in a complicated energy future, what policy and regulatory solutions are viable in Washington to advance the clean energy agenda, and more. Register here.

— "What congestion pricing in NYC will mean." Bloomberg.

— "Google's A.I. bonanza and driverless car talk with Cruise CEO Kyle Vogt." The New York Times.

— "Tesla shouldn't call driving system Autopilot because humans are still in control, Buttigieg says." The Associated Press.

— "Pilots at United picket for higher pay as pressure builds before summer travel season." The Associated Press.

— "Jet orders boom as airlines fear shortage." Reuters.

— "Will EVs dent the auto repair business?" The Wall Street Journal.

A message from Regional Airline Association:

Special interests are on the Hill denying a pilot shortage that has devastated rural communities, seeking to block critical safety evolution with misleading charts and statistics, while pushing the most experienced pilots out of the flight deck through an unscientific retirement mandate. Why? Some hope a large moat around the career will drive wages – in a profession where first year pay averages $100,000 and top earners make $590,000 per year – even higher. Let's be clear: airlines propose to strengthen—never erode—pilot training. When it comes to the value of flight time, the FAA said this when it wrote the rule: "The FAA was unable to find a quantifiable relationship between the 1,500-hour requirement and airplane accidents and hence no benefit from the requirement." Academic flight training courses, flight training devices, and simulation technology have seen tremendous advancements, and should complement flight time for a higher level of safety.