The Year the Climate Crisis Arrived
This blog explores the current state of the climate crisis and how it is affecting the travel industry.
The travel and investment communities, as well as all of society, must no longer ponder questions of “what if?” or “when?”; 2024 will be the year for reckoning with the question “now what?”
JetBlue Ventures in the past has not classified Tomorrow.io, one of our first portfolio companies, as an ESG investment. While Tomorrow.io is undeniably a global leader in climate tech, it felt like a stretch to call a suite of software products that provides hyper-local, hyper-real time weather forecasting a technology working to solve the climate challenges the travel industry confronts.
Whereas climate change felt like a long-term risk, even as recently as just a few years ago, there is now no denying that the increase in frequency and intensity of extreme weather events has created new operating challenges that travel providers must face.
I recall distinctly a discovery conversation between Tomorrow.io, JetBlue’s ESG team, and JetBlue Ventures only two years ago exploring JetBlue’s possible needs for adaptability and resilience scenario planning. Specifically, we explored coastal flooding and the impact of rising sea levels on airports, a relevant concern for JetBlue which flies nearly half of its schedule out of airports that hug the low-lying shorelines of Boston, JFK, LaGuardia, San Francisco, and elsewhere.
While such analyses remain critical elements of climate planning, operators’ sights have become more squarely focused on the near-term. In 2023, extreme weather impacted airlines and other travel companies in ways never previously imagined. This summer, amidst a Heat Dome covering wide swaths of the United States, flights at Las Vegas’s Harry Reid International Airport were grounded due to overheated aircraft, with some reaching temperatures in excess of 110 degrees Fahrenheit (around 45° Celsius). Meanwhile, wildfires in Northern Canada drove hazardous air quality levels as far south as the mid-Atlantic, leading the FAA to ground flights throughout the Northeast.
For those already bought in on the science and urgency of the climate crisis, it is informative to engage others who may have previously been skeptical. According to a Pew Research poll in April 2021, only 57% of Baby Boomers and older agreed that “climate should be the top priority to ensure [a] sustainable planet for future generations,” compared to 71% of Millennials.
Yet given the increased risk of property damage from extreme weather events, there is ample reason to believe that Boomers are feeling the impact of climate change where it hurts most, their pocketbooks. According to the National Association of Realtors, Boomers made up 39% of homebuyers in 2022. These buyers must now confront the sticker shock of skyrocketing homeowner insurance prices (up 68% in Florida from 2021 to 2023) and underwriters leaving their states altogether, as California’s largest home insurance provider State Farm announced in May that it would no longer issue new policies.
Where does this leave us headed into 2024? Like the general public, the travel and investment communities must continue their evolution from “what if?” to “now what?” and employ both reactive adaptations and proactive avoidance through decarbonization.
Beyond Tomorrow.io, we are betting on adaptability in Rubicon Carbon. Rubicon is resolving many of the inefficiencies that the first wave of carbon credits left unaddressed. Founded by a leadership team that restored structure, transparency, and trust to equity derivatives at Bank of America after 2008, Rubicon is reimagining carbon offsets as diversified, tranched securities, applying a level of rigor previously unseen in carbon markets.
We have had a big year of decarbonization investments too. Last week, we announced our investment in Aether Fuels which is pioneering a novel technological approach to producing Sustainable Aviation Fuel. We are also excited to see our investment in Pulsora, a B2B SaaS for managing the compilation and publishing of corporate sustainability disclosures, flourish as regulators from around the world begin to converge on the standards by which corporations will report on their environmental impact.
Wearing the hat of both a travel industry insider and venture capital investor, it is abundantly clear that there is a robust market for climate technology that will only grow over the next decade as the impacts of the crisis become real. Although the travel industry faces a dire, existential challenge, we can both surmount these challenges and grow by acting now.
