United Sustainable Flight Fund Invests in Heirloom to Scale Direct Air Capture

Rhea-AI Summary

United Airlines (UAL) announced that its UAV Sustainable Flight Fund has invested in Heirloom, a direct air capture (DAC) company. The investment includes rights to purchase up to 500,000 tons of carbon dioxide removal for sustainable aviation fuel production or underground storage.

Heirloom's technology leverages limestone to capture CO2 directly from the air, representing a potentially cost-effective carbon reduction solution. This marks United's third carbon capture investment but first in DAC technology, supporting the airline's commitment to achieve net zero emissions by 2050.

The UAV Sustainable Flight Fund, with over $200 million in commitments from United and partners including Air Canada, Boeing, Google, and others, aims to support startups focused on aviation decarbonization.

Positive

• Secured rights to purchase 500,000 tons of carbon dioxide removal
• Third carbon capture investment, expanding decarbonization portfolio
• $200M+ committed to Sustainable Flight Fund with major corporate partners
• Investment in potentially low-cost carbon reduction technology

Negative

• Significant capital expenditure required for carbon capture initiatives
• Long-term timeline (2050) for achieving net zero emissions

Insights

Financial Analyst

United Airlines' investment in Heirloom's direct air capture (DAC) technology through its Sustainable Flight Fund represents a strategic carbon hedging move with both immediate and long-term financial implications for investors.

The secured rights to purchase up to 500,000 tons of carbon dioxide removal capacity provides United with a significant competitive advantage in a tightening regulatory environment. With voluntary carbon removal credits currently trading between $200-600 per ton for high-quality DAC solutions, this agreement potentially secures access to $100-300 million worth of future carbon removal capacity - a valuable asset as carbon prices are projected to rise substantially through 2030.

This dual-investment approach - taking an equity position in Heirloom while simultaneously securing offtake rights - creates two distinct value streams for United:

• Potential appreciation of their ownership stake in a growing DAC technology company
• Below-market access to carbon removal capacity that will likely increase in value as regulations tighten

The investment aligns with United's capital allocation strategy toward decarbonization technologies that offer both environmental and economic returns. As Andrew Chang stated, UAV focuses on "solutions for decarbonization that are profitable" - signaling to investors that these aren't purely ESG investments but calculated financial decisions.

For shareholders, this positions United ahead of competitors in addressing Scope 1 emissions compliance costs. With the aviation industry facing increasing pressure from regulations like the EU's Emissions Trading System expansion and the CORSIA global carbon offsetting scheme, securing early access to cost-effective carbon removal technology could translate to lower compliance costs relative to competitors in the 2030-2050 timeframe.

The investment also diversifies United's decarbonization portfolio beyond sustainable aviation fuel (SAF), recognizing that carbon removal will likely be necessary to address residual emissions even with SAF adoption. This portfolio approach reduces technology risk while maintaining United's leadership position in aviation sustainability.

Investors should note that while immediate financial returns may be , this strategic positioning could yield significant competitive advantages as carbon pricing mechanisms mature and regulatory requirements intensify across global markets.

Sustainable Flight Fund also gets the right to purchase up to 500,000 tons of carbon dioxide removal

Heirloom's proven technology uses limestone to absorb CO₂

CHICAGO, Feb. 25, 2025 /PRNewswire/ -- United today announced that the UAV Sustainable Flight Fund has made an investment in direct air capture (DAC) company Heirloom, adding Heirloom's measurable, quantifiable carbon reduction technology to its already robust portfolio of decarbonization strategies. The Fund also entered into an agreement for the right to purchase up to 500,000 tons of carbon dioxide removal (CDR) to be delivered for the production of sustainable aviation fuel or permanently stored underground.

Heirloom's already-proven and scalable technology accelerates the natural power of limestone to capture CO2 directly from the air – making it potentially one of the lowest cost pathways for removing carbon dioxide.

"Carbon capture is one of our country's fastest growing, energy enabling pathways," said Andrew Chang, head of United Airlines Ventures. "At UAV, our primary focus is finding solutions for decarbonization that are profitable. Heirloom's technology aligns directly with this objective, offering a scalable and commercially viable approach and complements United's commitment to net zero by 2050."

"We are incredibly proud to welcome the United Sustainable Flight Fund as an investor and to work with them to scale our DAC technology," said Shashank Samala, CEO of Heirloom. "By utilizing DAC as a dual-pronged tool that can both greatly reduce CO2 emission from aviation fuel and remove residual emissions, we are charting a true path to Net Zero aviation."

Heirloom marks United's third carbon capture investment but the first in a company commercializing direct air capture technology. DAC is one of two main forms of carbon capture utilization and storage, along with point source capture. Unlike point source capture which captures CO₂ from a specific emitting source, like a power plant, DAC removes atmospheric CO₂.

UAV Sustainable Flight Fund

The UAV Sustainable Flight Fund^SM is a first-of-its-kind investment vehicle designed to leverage support from cross-industry businesses in order to support start-ups focused on decarbonizing air travel. The fund is comprised of more than $200 million in investment commitments from United and corporate partners including: Air Canada, Air New Zealand, Aircastle (a Marubeni & Mizuho Leasing Company), American Express Global Business Travel, Aviation Capital Group, Boeing, Boston Consulting Group, Embraer, GE Aerospace, Google, Groupe ADP, Hawaiian Airlines, HIS, Honeywell, JetBlue Ventures, Natixis Corporate & Investment Banking, Safran Corporate Ventures, and Technip Energies, among others. For more information about the fund, please visit the United Airlines Ventures website.

About Heirloom

Since its founding in 2020, Heirloom has become one of the world's leading DAC companies. In 2023, Heirloom began operating North America's first commercial DAC facility in Tracy, California. Heirloom is part of the team building Project Cypress — a Department of Energy supported DAC Hub, which is eligible for up to $600 million in government funding, and which will bring large-scale carbon removal to Louisiana and create nearly 1,000 new jobs.

About United

At United, Good Leads The Way. With U.S. hubs in Chicago, Denver, Houston, Los Angeles, New York/Newark, San Francisco and Washington, D.C., United operates the most comprehensive global route network among North American carriers and is now the largest airline in the world as measured by available seat miles. For more about how to join the United team, please visit www.united.com/careers and more information about the company is at www.united.com. United Airlines Holdings, Inc., the parent company of United Airlines, Inc., is traded on the Nasdaq under the symbol "UAL".

United Forward-Looking Statements and Other Important Information

This press release contains certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 relating to, among other things, plans and projections regarding the company's environmental, social or governance (ESG) goals, targets, commitments, strategies and initiatives and related business and stakeholder impacts. All statements that are not statements of historical facts are, or may be deemed to be, forward-looking statements. Such forward-looking statements are based on historical performance and current expectations, estimates, forecasts and projections about our future financial results, plans, objectives, goals, targets, commitments, strategies and initiatives and involve inherent risks, assumptions and uncertainties, known or unknown, including internal or external factors that could delay, divert or change any of them, that are difficult to predict, may be beyond our control and could cause our future financial results, plans, objectives, goals, targets, commitments, strategies and initiatives to differ materially from those expressed in, or implied by, the statements. These risks, assumptions, uncertainties and other factors include, among others, any failure to meet stated ESG goals, targets, commitments, strategies and initiatives in the time frame expected or at all as a result of many factors, including changing societal, market, competitive, regulatory or stakeholder expectations; any delay or inability of United Airlines to realize the expected benefits of the investment; and any delay or failure of any technology to be fully developed or become functional or marketable or to serve the purpose for which it was designed. No forward-looking statement can be guaranteed. Forward-looking statements in this press release should be evaluated together with the many risks and uncertainties that affect United's business and market, particularly those identified in the "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Risk Factors" sections in United's Annual Report on Form 10-K for the year ended December 31, 2023, as updated by our subsequent Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other filings with the Securities and Exchange Commission. Risks and uncertainties related to United's environmental compliance, climate commitments and climate strategy are further described in Part I, Item 1A. Risk Factors of United's Annual Report on Form 10-K for the fiscal year ended December 31, 2023— "We are subject to many forms of environmental regulation and liability as well as risks associated with climate change and may incur substantial costs as a result. In addition, failure to achieve or demonstrate progress towards our climate goals may expose us to liability and reputational harm."

The statements included in this press release are made only as of the date of this press release and except as otherwise required by applicable law or regulation, United Airlines undertakes no obligation to publicly update or revise any statement, whether as a result of new information, future events, changed circumstances or otherwise. In particular, United Airlines reserves the right to change, amend, supplement, or abandon some or all of the statements regarding goals, targets, commitments, strategies, initiatives, intentions and other statements from time to time without notice.

In addition, some of our disclosures in this press release are estimates or based on assumptions due to inherent measurement uncertainties.

 

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SOURCE United Airlines

FAQ

How much carbon dioxide removal can United Airlines (UAL) purchase through the Heirloom deal?

United secured rights to purchase up to 500,000 tons of carbon dioxide removal through the Heirloom investment deal.

What is the total investment size of UAL's Sustainable Flight Fund in 2025?

The UAV Sustainable Flight Fund comprises over $200 million in investment commitments from United Airlines and its corporate partners.

How does Heirloom's direct air capture technology work for UAL's carbon reduction?

Heirloom's technology accelerates limestone's natural ability to capture CO2 directly from the air, offering a scalable and potentially low-cost carbon reduction solution.

What is United Airlines' (UAL) carbon emission target timeline?

United Airlines has committed to achieving net zero emissions by 2050.