Today, Ross and Christophe are joined by Sophia Mendelsohn, Head of Sustainability at JetBlue to discuss the incentive to offset carbon emissions at the personal, company, and global levels. They speak to how the industry is addressing climate change via the CORSIA deal and why limiting carbon exposure and liability makes good business sense from a financial perspective.
Full Transcript
Alexsandra Guerra: You’re listening to the Reversing Climate Change podcast by Nori, the world’s first carbon removal marketplace. Here are your hosts, Ross Kenyon and Christophe Jospe.
Ross Kenyon: Hello, welcome to the Reversing Climate Change podcast with Nori. I’m Ross Kenyon. I’m here with Christophe. I almost said, well, it’s Christophe Jospe. Don’t you wish you were him now?
Christophe Jospe: That’s me. Thanks, Ross.
Ross Kenyon: And producer Paul, Paul Gamble, CEO of Nori. Nori is our new name. We were Giagra. We were in stealth mode there, but we have now committed to Nori. I thought it was a cute name that is positive, reflects what we’re up to. We love C. We’re in New York right now. We’re actually in Long Island City at JetBlue headquarters. We’re actually here in town because we won the blockchain first. Social Impact Hackathon with ConsenSys, which is a huge deal. I’m pretty excited about this, aren’t you, Christophe?
Christophe Jospe: I’m really excited about it. Yeah, thanks, Ross. And without any further ado, really happy to be sitting across from JetBlue’s head of sustainability, Sophia Mendelsohn. And Sophia, can you introduce yourself and tell us a little bit about what you do here at JetBlue?
Sophia Mendelsohn: Well, and congratulations on the huge win.
Christophe Jospe: Thank you. Thank you.
Sophia Mendelsohn: So I don’t win hackathons, but I do run sustainability for JetBlue Airways, which means it is my job to think about our natural resource consumption and extradalities here and going forward.
Ross Kenyon: How’s that been going? I know you have a reputation of being an industry leader in this, but I should probably preface this by saying I really am pretty new to this entire space. So I’m stepping in here for the average person who has no idea. So why don’t you treat me like I’m a very young child and explain to me what you’re up to?
Sophia Mendelsohn: Sure. Having had a very young child recently, I’ll do exactly what I do with him, which is explain that we all like to go places. We all like to fly. And that doesn’t happen on unicorn tears and rainbows. It takes carbon, which we currently all use in the form of fossil fuel. And when that fuel is put into the engine, it’s burned and it leaves a trail of pollutants. And those pollutants are invisible and you can’t smell them and you can’t see them. But what they do is they trap heat and moisture in the atmosphere and that changes everything.
Ross Kenyon: And what can you do on your end? I know corporate social responsibility is a big, big platform here, a pretty big program.
Sophia Mendelsohn: So as an individual consumer, like you’re just you going to see grandma reluctantly or happily. You’re going to Japan for your honeymoon and you want to feel good about it. The most simple and basic thing you can do is offset your carbon. It’s like eating a cookie and then going to the gym. You intake calories and you exercise to burn off the calories. You fly, you put out the greenhouse gas pollution and You get on the internet, you pay for a carbon offset, and you absorb or suck out that carbon pollution out of the atmosphere.
Ross Kenyon: And if I’m flying JetBlue, which I do, I like JetBlue, are you doing that for me? Do I need to do something extra or are you just doing it as part of the company’s mission?
Sophia Mendelsohn: No, we’re not doing that for you yet. I think there is a future where that will happen for the consumer. But before that happens, we need the individual consumer to do this for themselves to show there’s interest and understanding and demand for it.
Ross Kenyon: Okay. First off, what do you got over there? What are you thinking? You look deep in thought.
Christophe Jospe: Yeah, well, I’m kind of taking in what I’m reading on the board here. I haven’t seen this yet. So just for all our listeners, I’m seeing one, two, and three, Climate Leadership, Sustainable Operations, and Sustainable Tourism. We’re talking about aviation, which we know makes up 2% of the world’s global carbon emissions, which seems like not that much. But why is it a big deal for the aviation industry to try to decarbonize and try to make that 2% turn into 0%?
Sophia Mendelsohn: And when you’re talking about greenhouse gas emissions and climate change, any percent is a lot. So if I take a drive and that’s 0. 000000 billion more zeros, 2% of greenhouse gas emissions for the world, it doesn’t matter because those are mine. That’s my gig. That’s my deal. That’s my responsibility. That’s what I want to think about for myself. So don’t think about it as a percentage game. I think about it as a responsibility game. And the three things we work on for our responsibility are climate leadership, sustainable operations, and sustainable tourism.
Climate leadership is obvious. We’re an airline. We need to burn jet fuel to be in business to get you where you want to go. As we discussed, that means greenhouse gas emissions, and that means both risk and opportunity for JetBlue. On the risk side, we know things are going to change. We know sea levels are rising. We know temperatures are fluctuating. We know warm air holds more moisture, and that changes everything. So we have to think about our operational risk, our regulatory risk. How is Congress going to react to this?
How is the rest of the world’s governments going to react to this? And what are the opportunities? I mean, is the Caribbean going to change? Is ski season going to change? Is Minnesota going to become the next hot spring break destination? Because that’s like a place with a comfortable temperature. There are lots of business angles we can look at climate change from. And the other issue of sustainable operations is just good, lean, frugal operations. When you’re talking about aviation, it’s easy because the less fuel we burn, the more money we save, the less greenhouse gas emissions go into the air.
It’s so simple. It’s just good business. It’s not like some other industries are like, well. So if you invest and then 10 years later and you sell the board on it and they do the right thing and then business case doesn’t work out, but 15 years later you feel like a good person. No, this is just simple business needs. And the third thing we think about is sustainable tourism. So we make a lot of money flying people to the Caribbean. Why do they want to go to the Caribbean? They’re not going for museums.
They’re not going for shopping. They’re going for the beach. Going for the atmosphere, the environment, the physical environment. So even if you go to an all-inclusive resort and you just kick it with a drink and an umbrella over you and a little one for the drink, you are still an eco-tourist. You still went for environmental reasons because you are motivated to go to Jamaica or St. Thomas because the environment there is beautiful. That means you care about the environment and that means climate change is going to affect your life.
Ross Kenyon: I mean, they could just be big Jimmy Buffett fans, too. Only to environmental amenities like that. But yeah, it’s probably mostly that.
Sophia Mendelsohn: You could then just like save yourself the flight or take a shorter flight and like go to Virginia or something.
Ross Kenyon: That’s definitely true. What might I owe? So if I was to offset how much carbon that I emitted flying from, I flew from Burbank.
Sophia Mendelsohn: Right.
Ross Kenyon: How much might I have to pay?
Sophia Mendelsohn: Well, carbon offsets are a market. So like anything, it depends on where and when you get it. You can get the same shirt at H&M for $30 one day and see it on sale for $3 the next day. But in general, I’d say if you’re flying from the West Coast to the East Coast, bank on like $10 to $15.
Ross Kenyon: That’s like not that much money. I kind of expect it to be a little more than that. There’s not like a good universal price for this yet, is there?
Sophia Mendelsohn: There’s not. And I’m not sure there ever will be one universal price because it’s going to work like a market. So if you look at the stock market, there’s no one set price for a stock. We just trust in the invisible hand and capitalism for better or worse that a good stock is going to be valued at more than a bad stock.
Ross Kenyon: I know I can just feel it in Paul’s soul. He wants to talk about the universal price of carbon. Is that true? Do you or do you not?
Paul Gambill: I do, whether it will. Part of our model is that we’re using a cryptocurrency, a token that will be worth one ton of CO2 removed.
Sophia Mendelsohn: Right.
Paul Gambill: So if you’re going to be purchasing a carbon removal credit, whatever that token is trading for in the exchange markets is sort of a universal carbon removal price. Yeah. But I mean, it would fluctuate.
Sophia Mendelsohn: The price fluctuates.
Ross Kenyon: Yes. Yeah.
Sophia Mendelsohn: I think regardless of how you pay for greenhouse gas emissions and what price you’re paying for greenhouse gas emissions, the major breakthrough we all need to make globally is that if we don’t pay for them, we don’t have incentive to reduce them. And if we don’t reduce them, our lives are going to get measurably worse.
Ross Kenyon: My biggest problem here is that I’m concerned with like the game theory, the economic incentives of it, because if I individually pay to offset my carbon voluntarily, no one else does. Right. You’re just a sucker. I’m just a sucker. I’m just more poor. Right. So I don’t know how to how do you do that first move? And then if you go to like international relations level, it’s like, well, China is probably not going to do it because aren’t they better off if they don’t?
Sophia Mendelsohn: So let’s take it at three levels. The micro personal level, the middle kind of brand corporate company level, and the macro global level. So on a personal level, we all do lots of things to be okay with ourselves that other people don’t do. I don’t throw my trash on the streets of New York, even though the dude in front of me totally did that on my way here.
Ross Kenyon: Just walking? He just threw it?
Sophia Mendelsohn: Yeah, man.
Ross Kenyon: That’s the Louis C. K. joke. I guess he’s kind of out now. Yeah. New York is just one big piece of garbage anyways. Might as well.
Sophia Mendelsohn: Even if someone else doesn’t offset their greenhouse gas emissions, you’re really thinking about what you are personally responsible for. And when you offset your greenhouse gas emissions through a carbon credit, you’re not just like throwing money into the air until it floats around and sticks to some carbon. You’re actively paying to do something that’s good universally regardless of the greenhouse gas emissions consumption. So we can all agree that leaving trees in place, whether it’s in the Amazon or Canada, is good.
Unknown speaker: I’m not going to agree to that, though.
Sophia Mendelsohn: No, okay. There’s this chain, if you will, this knockoff effect of good things that happen when you consider the impact of what you do.
Ross Kenyon: So if people thought about it like littering, we’d probably be in a better spot where no one sees me do it. I would feel guilty if I just like threw stuff out of my car window on the highway or something. But I guess I don’t feel that about burning carbon as I’m driving the car. But I should.
Sophia Mendelsohn: Well, we don’t want you to feel bad because feeling bad doesn’t help change the system. We need to feel good about ourselves and we need energy to make those changes happen.
Ross Kenyon: And like the positive reinforcement, you know, scold people. I feel like scolding isn’t very good. It causes people to react against it.
Sophia Mendelsohn: No, no. Scolding is totally out with yuppie parentdom. So think of it like all the well done studies we’ve seen, which the biggest indicator of whether or not you’re going to get a solar panel is if someone else in your neighborhood also gets a solar panel on their roof. Same with electric car. Same with littering. The more trash you see on the street. The more likely you’re going to throw trash on the street. Proven over and over again. So you go first. You think about the impacts of your actions. You offset those.
You tell your friends. You put it on social media. You tell a company like JetBlue. And it becomes a normal part of being a good citizen.
Ross Kenyon: Just like peer pressure, but if your friends weren’t taking drugs or doing bad things.
Sophia Mendelsohn: Positive peer pressure.
Ross Kenyon: Positive peer pressure. Is that what you think about it, Kristoff?
Christophe Jospe: Yeah, totally. I just wanted, for our listeners’ sake, we’re throwing the word offset around. And actually, we did our homework for this interview, and I read some of the annual reports. There were some numbers that I came across, which I thought were awesome. So I saw that since 2008, JetBlue has offset 1. 7 billion tonnes of carbon dioxide.
Sophia Mendelsohn: Yeah, we’re coming up on 2 billion pounds, actually. If it were tonnes.
Christophe Jospe: Okay, that makes a lot more sense.
Sophia Mendelsohn: Yeah, if it were tonnes, I’d be like kicking it with Lisa Jackson over in Silicon Valley.
Christophe Jospe: Yeah, thanks for correcting that. So we talked about the different ways to offset where you’ve got replacing the emissions with installing solar power panels, you’ve got reducing the emissions, and then you’ve got removing the emissions. Right. It all gets bundled up into one, which seems kind of confusing to me.
Sophia Mendelsohn: That’s true. We’re here at JetBlue’s headquarters. We’re getting technical. We’re talking to people who really want to know how the game is played. The average person who gets on a JetBlue airplane wants to get there safely and on time, feeling good about themselves. And that kind of brings us to that medium level I talked about in between individual and macro. And that’s the role of the compass. That’s the role of the brand. We are living in a branded time where we are expressing ourselves through what we buy, where we buy it, what we expect from the people selling us goods and services.
When you spend your hard-earned money on a vacation, which you might have saved up for one or two years for, You want to feel good about the company you just handed your cash over to. You want to know that they’re going to take you to a beautiful place and you don’t have to worry about, you know, smog coming out of the engines. Just the way when you get in a car, you don’t want to see, you know, lead pumping out. Of the back of your car as you drive by an elementary school.
And it’s important that as consumers, you communicate that to the people you’re giving your money to. So you have so much power as a consumer and you’re Power is being amplified through the microphone of social media. It’s not just social media. It’s also what you say to someone who represents the brand. So if you’re at a grocery store and you’re purchasing something and you say, oh, I brought my own bag, that happens millions of times throughout the country. Eventually, the person behind the register who could work for a Walgreens or a Walmart will We’ll filter that information up to their manager and say, hey, it’s okay if we don’t presume customers want a plastic bag.
And likewise, if someone sitting in headquarters says, we’re all going to save money and fossil fuels and pollution by not giving customers plastic bags anymore, and they announce it and they roll it out through the stores, it’s important that the associates who work in the store don’t freak out about that and revolt. Because that can undo everything. Positive consumer environmental changes. But if they’ve been hearing for years, hey, I’ve got this, I’ve got my own bag, that’s going to cushion the impact of change. And we know change is hard and it’s important for consumers to lubricate the wheels of that change.
Ross Kenyon: I’d like to get a little more technical. So 1. 7 billion pounds of CO2 offset. What’s the process that you go through as a corporation trying to find these projects and purchasing them?
Sophia Mendelsohn: Right. So the process is that the corporation, powers that be, look out in the world and they’re like, whoa, this climate change thing is not going to go away. We really have to figure out how we’re going to address it. No one here has time to do that because everyone here is already doing a job. So we’re going to hire someone to think about it. They hire that someone, in this case me, and I say, okay, what are risks, responsibilities, and opportunities with climate change? Well, the first thing we need to do is get our head around our greenhouse gas footprint because that’s our biggest environmental impact.
And the easiest way to think about that is to reduce it. Okay, well, we’re already trying to reduce it. Those are the low-hanging fruits. We’ve got those. What can we do next? We’re going to have to offset it back to that eating a cookie and going to the gym analogy. So I basically said, for our greenhouse gases, we want to do the equivalent of going to the gym. So I got on the internet. I googled carbon offset, like the sophisticated professional I am.
Christophe Jospe: Internet research.
Sophia Mendelsohn: Internet research. Thank God I got a master’s in this. I Googled things. Might have even had some interns Google things until we had a database of folks who sold carbon offsets. We then went out to all of them and said, this is what we want to do. This is about how much we’re going to buy. We want a certain level of quality. We don’t want to buy bull. We don’t want a reporter coming and telling us that our money actually went down the drain and no children... We’re helped and no forests were preserved.
So don’t sell me crap. What’s your price? Compared all those details across the database and chose a supplier.
Ross Kenyon: You mentioned children and being affected in addition to just planting a forest. Can you talk about that aspect of?
Sophia Mendelsohn: I mean, I think I was using the theoretical children of like the good in the world.
Ross Kenyon: Paul, I think you’re a little, you don’t like the bundling, right? Like you wish it weren’t bundled. I’m curious what you think about it. These, you hear them called co-benefits, these urban offset projects. So I’m curious what you think of them and what JetBlue’s stance on that is.
Sophia Mendelsohn: Well, as an individual, co-benefits sound good. Okay. Benefit, that’s a positive word. So I’m good with that. As a representative of a business with shareholders and fiduciary responsibility, I’m in it to limit our carbon exposure and liability. And I want to do that in a robust way that will hold up through international agreements, that will not create more reputational risk, and that will not create other environmental or social problems that are just as bad or even worse. And because I work for a company, I want to do that for the lowest price possible.
Ross Kenyon: That’s a pretty good answer. You like that, right?
Unknown speaker: Yes.
Ross Kenyon: That’s what I hope to hear. That’s called fishing.
Sophia Mendelsohn: Oh, well, I didn’t feel fished because that’s what I say and think every day. This isn’t a charity and I’m not trying to do the right thing here. I’m trying to protect my business for the long run.
Christophe Jospe: Right. And one of the things that gets me about flying is we’re never going to fly airplanes on batteries, which means that, okay, you shake your head. Really? Is that coming?
Unknown speaker: I made a talking sound.
Christophe Jospe: You know, the physicists that I’ve worked for and the science nerd in me thinks about the energy density of a liquid hydrocarbon fuel packs about 100 times the punch per weight of a battery. So it’s just easier to burn fuel.
Sophia Mendelsohn: Yeah.
Christophe Jospe: Another word I’m seeing up there is Corsia, which I know is an industry alliance that’s looking at how to make more efficient fuels and some of the things that the airline industry can do. Can you talk a little bit about how you see that affecting the industry and how is JetBlue really leading that charge?
Sophia Mendelsohn: Yeah, and that brings us perfectly to the third level, which is the international macro level and how we make sure that Ross isn’t going to feel like a sucker if he offsets his carbon.
Ross Kenyon: I really appreciate that. Thank you.
Sophia Mendelsohn: I think most folks listening to this will know what the Paris Agreement is. And if you don’t, basically all you need to know about it is that it’s the first time every country in the world agreed on one thing. And that one thing was that climate change is going to be very bad for our citizens because governments and businesses and individuals like predictability and climate change is unpredictable. And so we all got together and for a short time, we all agreed that we were going to address climate change. And because it’s still math and it’s still physics and it’s still science, we through the Paris Agreement, we’re all collectively going to do the same thing that I’m trying to do at JetBlue, which is burn less fossil fuel to produce less greenhouse gas pollution.
And then what you can’t avoid, we’re going to offset. But there’s this little trick. As there always is, because you can’t regulate international travel through the Paris Agreement because each country is coming to the table representing just themselves. So the Paris Agreement can’t cover what countries kind of exchange over their international air and water. So the airline industry said, all right, we get it. This is not a problem we can ignore, nor when we necessarily want to. We’re going to make our own Paris Agreement. And we’re going to have an industry-supported Paris Agreement.
So everyone came to the table, literally, you know, long, big UN tables. And the nonprofits came and the NGOs came and the environmentalists came and the governments came and the airline industries came. And over years, we hashed out a deal. And part of that deal is that from 2020, international flying is going to be carbon neutral. From 2020... All new international flights are going to be offset so that we’re holding our international emissions levels steady from 2020 on. And there are a lot of details involved in that to make sure no one’s cheating.
And so like any good compromise in negotiation, you want everyone to be just mildly satisfied enough to keep the deal going. So it has to work for the environmentalists and it has to work for industry because at the end of the day, we all want to address this issue and we all believe the longer we put it off, the more expensive it’s going to be. And that whole deal comes together under the acronym CORSEA.
Christophe Jospe: Awesome. It sounds a little bit like what you’re describing is something to address the tragedy of the commons.
Sophia Mendelsohn: Yes, exactly.
Ross Kenyon: The tragedy of the commons. What’s that?
Sophia Mendelsohn: Oh, I have to explain that? I don’t know.
Ross Kenyon: I know this pretty well, but I feel like whenever you drop a big concept, it’s probably good to let people know what it is in case they don’t.
Sophia Mendelsohn: The tragedy of the commons is that when it’s everyone’s responsibility, it’s no one’s responsibility. And that’s why people throw trash on the streets of New York.
Ross Kenyon: No one owns it. They don’t really feel bad about doing so. It’s overused.
Sophia Mendelsohn: That’s what’s so tricky about climate change. I mean, we’re all part of the impact and we’re all part of the solution and no one wants to feel like they caused this big problem. No one was born into the industrial era thinking, I know I’m really going to screw the polar bears by just living my life and being raised how I’m going to be raised.
Ross Kenyon: Those things are mean. I don’t really know why people get so sentimental about them. They kill people. Let’s get them first. No, I’m just kidding. No, we’ll have to cut that out.
Christophe Jospe: Nor anti-polar bears. Yeah, we’re... I’m not sure if I’m willing to take the anti-polar bear stance. That was a train wreck, yeah. No, but I just... I’m getting this image in my head of this really long table where everyone’s agreeing to, hey, we’re all in this together. Yeah. Which, for an industry-wide, what that means is everyone is going to address this carbon dioxide, which is being emitted in the atmosphere.
Sophia Mendelsohn: Right.
Christophe Jospe: Which... We know stays there for centuries warming the planet. And that’s kind of what it comes down to is we’ve emitted it. We need to pull it back.
Sophia Mendelsohn: And what’s special, literally special about climate change is that industry is interested in working with governments and environmentalists because we know it’s going to cost us more if we don’t.
Ross Kenyon: Yeah, our approach, I got really excited about carbon removal just because the tension has always seemed between economic growth and being a good steward of the planet and the environment. But if you’re able to still emit quite a lot of carbon and still have industry, but we’re just paying to remove the carbon, isn’t that the best of both worlds? Isn’t that like something that we should be aiming at?
Sophia Mendelsohn: Yeah. I mean, we’re going to keep flying because our modern world depends on it. And if the planes stopped flying for any significant period of time, you would very quickly realize that you couldn’t get your food or clothing because physics is the way it is. A liquid fuel will always be easier to take up into the air for a big airplane than a battery. So for the foreseeable future, if we’d like to keep living comfy international lives, We’re going to keep flying. We’re going to keep doing it on fossil fuels for the foreseeable future for the majority of the time.
Ross Kenyon: Would it be cheaper to just burn it and then remove it as we’re doing now? Or is it better to just have a battery that’s 100 times less efficient? Is that less efficient? Like where’s the empirical evidence?
Sophia Mendelsohn: So all flying is not created equal. Short haul flying might make sense for an electric future.
Ross Kenyon: Long haul flying, maybe not, because the longer you fly, the bigger battery will And just the weight goes up just sort of like geometrically or some sort of math term.
Sophia Mendelsohn: I don’t know. Yeah. There’s some guys sitting 15 feet away from us who could tell us if geometrically is the right adjective for that term.
Ross Kenyon: I’m already bored.
Sophia Mendelsohn: It’s okay. The other option is biofuels.
Ross Kenyon: Yeah, I saw that you work on that and I don’t really know too much about it. The only thing I really know is I kind of have a negative impression just because I’ve heard ethanol is a pretty bad deal. It costs way more energy to make it than anything else. But I assume you’re doing something that’s different. I don’t really know much about it.
Sophia Mendelsohn: So I don’t know if ethanol is inherently bad. I think anytime we look for a silver bullet and you get people really, really winning financially from that silver bullet.
Ross Kenyon: Like Big Ag likes it a lot, I’m sure.
Sophia Mendelsohn: You need to look for a suite of solutions. So I think biofuel and ethanol got a bad rap because it felt like the only path forward was corn. And that doesn’t have to be the case because the brilliant thing about hydrocarbon is the important part is the carbon. And just like we all learned back in elementary school, that’s the building block of life. So it’s in a lot of things. It’s in lots of different oils and lots of different types of plants produce those oils. And some of those plants can grow in the winter when a farmer isn’t growing anything else.
And that’s the type of solution we want to start to look for.
Ross Kenyon: What crops are these?
Sophia Mendelsohn: They’re called fatty acids. So they’re plants like an olive oil plant or a canola plant. That produces an oil in the seed that has a lot of fat, that has a lot of carbon, that has a lot of energy in it. And in some cases you can eat that. And in some cases they’re non-edible. You can’t eat them and you can turn them into fuel.
Ross Kenyon: You blend these all together. I’m not just flying on olive oil when I’m going home.
Sophia Mendelsohn: No, no, no. There are some pretty strict rules around that.
Ross Kenyon: Around the olive oil?
Sophia Mendelsohn: Around biofuels and what you can and can put into an airplane.
Ross Kenyon: Okay, that’s interesting. I don’t really know much about it, but that sounds pretty cool. I’m sure there’s ways to make it work. I’ve just heard that before, but people get all angry about politics. I’m not surprised I only heard that one side of it.
Sophia Mendelsohn: Yeah, there are ways to make it work, but just like any... Physical material, it’s always going to be harder to create something new from scratch like a biofuel than leave something where it is already. So if we can offset carbon where trees are already planted and protect them from being cut down when they would otherwise be cut down, that’s much simpler. Nature has already created and paid for that solution.
Ross Kenyon: Yeah, it’s like the, what’s the rule for sales? It’s like retaining a client is 10 times cheaper than getting anyone. So trees is just that, right? Just keeping trees is better. I haven’t thought about it that way.
Christophe Jospe: You know, I kind of like that. It’s kind of a tortured analogy.
Ross Kenyon: Well, thank you. And I’m glad you like it.
Christophe Jospe: It works.
Ross Kenyon: It works? Cool.
Christophe Jospe: Sometimes in the sustainability world, these words called scope one, scope two, scope three emissions are thrown around. No idea what that is now. Please explain for Ross and everyone else. How does JetBlue think about that and address their scope one, two emissions?
Sophia Mendelsohn: So scope one is like what’s closest to you. So our scope one emissions are literally the emissions from the jet fuel that we buy and put in the airplane. Scope two is like kind of what happens from the emissions from the airport where we land and you walk through. Scope three are the emissions from the taxi that pulls up to the airport. Kind of think of it like scope one is what you do when you cheat on a math test. That’s your scope one. You know, your scope two is when like you see someone else cheat on a math test and you kind of enable it and you don’t, you know, you don’t do it.
And scope three is like when you heard a rumor.
Christophe Jospe: So scope two is like, well, I’m sitting next to the cheater in the math class and he looked over and saw me. But if I wasn’t there, you know, he would have cheated on someone else and flown Delta.
Sophia Mendelsohn: Exactly. Well, yeah.
Christophe Jospe: Maybe not the second choice, but you know where I’m going with that. So your scope one emissions were about 7. 4 million tonnes of carbon dioxide. Yeah. Is that a lot or a little?
Ross Kenyon: Give me some sense of what the scale of this is.
Sophia Mendelsohn: It’s a lot because we’re an airline, but it’s not as much as the United States or a whole country. But it’s going to be a lot more than the town where your aunt lives. I mean, there’s got to be a statistic for like the average American.
Christophe Jospe: Yeah, we can do some math on the spot. I mean, the average American emits between 16 and 20 tonnes of carbon dioxide a year. So doing some fast division.
Ross Kenyon: Producer Paul over here, he’s ready to go.
Christophe Jospe: That makes up, hmm, how many people would that be? That’d be 370,000 people of their average emissions.
Sophia Mendelsohn: Yeah. So something, you know, like a town, it’s not like looking at the emissions for China or something.
Ross Kenyon: Oh, okay. And why don’t you continue? You were gone on a thing and I interrupted you there.
Christophe Jospe: Well, I was just trying to think, okay, we’ve got this 7. 4 million ton and then we’ve got some volunteers, unlike Ross, who don’t feel like chumps. I might put myself in that category. I get it. I’m a total chump. And I want other people to be chumps with me and pay for their carbon footprint. But what percent of passengers do you think would actually want that? At the end of checkout, they say, yeah, I want to pay to remove all this carbon dioxide or offset it.
Sophia Mendelsohn: Well, I think if you ask what percent of passengers want to feel good about their flight, want to be a good person, pay it forward, and know that the next generations are going to be safe, 100%.
Unknown speaker: While you’re optimistic.
Sophia Mendelsohn: 100%. If you ask what percent of customers understand the connection between their flight, their choice to offset, and their quality of life in the future and future generations’ quality of life, You’d get probably less than 50%. And then from there, you have a trust issue. I’m not getting anything I can directly see for this money. And that’s a challenge that charities have dealt with since the beginning of time. Usually when we handle our money, we want to get something physical back in return or some service back in return.
Ross Kenyon: Yeah, I’m always very cautious about giving to charities just because I feel like I have to investigate and make sure it’s actually effective or at least not corrupt. And I think the same thing with the administrative costs of auditing conventional offsets, like 40 to 60 percent, something like that. Is that right? I don’t want to pay for that, though. I want it to be like as slim as possible. I feel like it’s a huge amount. I could double how much I’m offsetting if it wasn’t for that.
Sophia Mendelsohn: It’s kind of like sometimes the insurance you buy is as expensive as the product. You want to make sure that what you’re paying for to offset your carbon is permanent. They’re not going to take the same tree and sell it to the next guy.
Ross Kenyon: I wonder if blockchain could help that at all. This is Paul’s life mission.
Paul Gambill: Yes. I’m obsessed with this. The double counting problem with offsets.
Sophia Mendelsohn: Yeah, the double accounting problem is like any accounting thing. You don’t want sketchy people moving money from one place to another.
Ross Kenyon: Would you call them used carbon salesmen?
Unknown speaker: That’s what we call Christophe.
Christophe Jospe: That’s me by the end.
Unknown speaker: It’s a good term though, right?
Christophe Jospe: Yeah, it’s a great term. I should have put it on my business cards.
Sophia Mendelsohn: And that’s why these long, drawn-out discussions at long UN-like tables take so much time because- Non-industry stakeholders want to make sure that industry isn’t going to cheat. And likewise, we don’t want to cheat because we don’t want watchdogs in the media pointing to us and saying, you spent all this money and it’s bull anyway.
Ross Kenyon: Yeah, liberal hypocrisy or left-wing hypocrisy, people love that. And it looks bad when environmentalists are like Harrison Ford flying his private jet to the conferences. Like, I know Fox News loves it whenever that happens. It doesn’t help the climate change cause when they get a chance to.
Sophia Mendelsohn: I think it’s important to remember what type of scale we’re talking about. And it’s always difficult to think everything I do is relevant. This is my personal responsibility on this really small scale. On the other hand, this is a global problem. So you should still get on your flight. Harrison Ford can still get on his flight. And we’re going to have these really big, high-level discussions like the Paris Agreement. And while all that stuff is going on, we still have to care about our own actions, too.
Ross Kenyon: Sure. I mean, yeah, his defense, too. I’m sure he probably could have been offsetting his own use, too. Like they didn’t report on that. But yeah, that’s just how it goes.
Christophe Jospe: Yeah. So you’ve been bringing up the Paris Agreement. There’s another city that’s coming out in the news, which is Bonn. And how does what has recently been happening there affect your work? And can you explain to our listeners what’s going on or just finished right now?
Sophia Mendelsohn: Yeah, I think what’s important is that businesses will always act logically in fiduciary responsibility. So... I feel lucky to work for a business on this issue because I’m just going to keep going by the numbers. JetBlue began focusing on climate leadership and sustainability because numerically it made business sense. Numbers don’t change. So no matter what’s going on in the political environment, we are going to continue to support Corsia, the international deal to make sure that businesses and other social stakeholders are working together in aviation to get our carbon under control and take care of our climate risk.
Christophe Jospe: Awesome. So I’m curious if we were to put a crystal ball in your hand and you could speak for JetBlue of where you see it going in maybe five years or 10 years as it relates to sustainability. Yeah.
Sophia Mendelsohn: Well, I’ll put the crystal ball in my hand and I’ll speak for myself so I can say things without liability. Where do I see JetBlue going in five to 10 years? I see us going to definitely going to new destinations that’s been dropped a couple of times in the press. So right now we fly to the Caribbean. Fly to Latin America. We fly all over North America. But folks have mentioned Canada. They’ve mentioned Europe. Some exciting expansion there. I see us doing some cool things with electric planes. I see us keep going with biofuels.
Most of all, I see customers demanding more and more from companies and wanting to know that the company they’re spending money with represents their values.
Ross Kenyon: Yeah, I guess that makes sense. People do go that direction. I don’t know. I don’t really have much to say about that.
Sophia Mendelsohn: Okay. Let’s say you’re walking around and you’re thirsty. So you want to buy a drink and there’s some kids selling lemonade. So you go up and you’re going to get lemonade from their lemonade stand. And they begin to explain to you like, yeah, we started this idea on our own. Our parents said no one would buy lemonade, but we really wanted to do it. And we went to the store and we even spent the money on organics. Because we heard that’s better for the farmers when they harvest them. And we kept the sugar on the side because, you know, my grandma told me sugar isn’t too good for you.
So you can control how much sugar you want to put in it. You can use this reusable cup and my sister’s going to wash it by herself afterwards and all the money you give us from this lemonade we’re going to put straight into our college fund. That is a very different feeling than like rolling up to a gas station being like, oh, they only have Coke. So I’ll get the Coke instead of my usual Diet Coke. And, you know, oh, my God, it’s like three dollars because they can charge whatever they want.
I don’t find I’ll buy that.
Ross Kenyon: One of those examples is way cuter than the other one.
Sophia Mendelsohn: Right. And feeling good about yourself is way cuter than the other.
Ross Kenyon: Supporting the old guy at the gas station gives me a lot of joy. And I’m going to buy lemonade from that lemonade stand every day.
Sophia Mendelsohn: Yeah. Whether you’re thirsty or not, because we all want to connect with our values and we all want to feel good about where we’re exerting our power. And as a consumer, where you spend your money is power.
Ross Kenyon: Yeah. I’m not too motivated by that. I’m trying to think of examples where I might be like when I’m choosing an air carrier, I’m looking at personal comfort. I almost never look at that sort of thing. But do you have numbers? Do people like to do that?
Sophia Mendelsohn: Yeah. And people are always going to look at price and schedule because you got to pay for it. You got to be able to afford it and you got to be able to get there on time and get to where you’re going by the time you need to be there. Beyond that, though, people look at how a company behaves. And there are famous examples of this that can help illustrate it for the airline industry, like Warby Parker, Tom’s Shoes, Whole Foods. The list goes on and on.
Ross Kenyon: I guess seeing the United had a bunch of customer service faux pas, I guess you could say, the last while probably made me less likely to want to fly on United, I suppose. Southwest is like really warm and cuddly. I like flying Southwest for that. I guess I feel like they take care of people and therefore like they’re happier working there. It’s unconscious. Is this kind of what I’m getting at? Yeah, it’s under there.
Sophia Mendelsohn: I mean... Good branding and good advertising doesn’t hit you over the head. It slowly communicates with you until you trust the brand you’re giving your money to.
Ross Kenyon: It’s just culture. Yeah. Just sort of like below the surface. Yeah.
Sophia Mendelsohn: Okay. You can’t hide.
Ross Kenyon: I’m trying to figure that out. I guess I haven’t flown JetBlue nearly enough. I think I’ve had flown probably a dozen flights, but I got to work more into your network and see if I can see what you’re subliminally teaching me capitalism.
Sophia Mendelsohn: We have a good loyalty program. We have a great loyalty program. Oh, loyalty program.
Christophe Jospe: Oh, yeah. Certainly use my true blue points.
Sophia Mendelsohn: Yeah, you can share with your life.
Ross Kenyon: I’m building a little true blue war chest right now.
Sophia Mendelsohn: They don’t expire.
Ross Kenyon: Yeah, they’re good. Is there anything else you think we should cover? Are we feeling pretty good?
Christophe Jospe: Yeah, I think we’re about ready to wrap it up. But Sophia, do you have any final words you want to throw in there?
Sophia Mendelsohn: I would say there’s a lot of focus around artificial intelligence and big data. And you could almost say we’re at peak hype curve on some of that stuff. And once the noise goes away, what we’re going to need to do is apply that math, those skill sets that people are building in those areas to the issue of climate change. Because Nothing could be more important for more people around the world.
Ross Kenyon: That sounds pretty good. Well, thank you, Sophia, for being with us. It was very fun to chat with you. Thanks for letting me prod you a little bit and ask you a couple of medium tough questions. Nothing out of your ballpark.
Unknown speaker: Yeah. Thank you, Sophia. I thought we threw softballs. Yeah.
Sophia Mendelsohn: Yeah.
Christophe Jospe: We didn’t have any gotchas.
Ross Kenyon: No, no. They made me take all the gotchas out earlier.
Sophia Mendelsohn: Oh, that’s okay.
Christophe Jospe: We’re saving those for United.
