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JetBlue Signs Mega Renewable Fuel Deal with SG Preston (Revised)
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In order to reduce carbon emissions, JetBlue AirwaysCorp. (JBLU - Free Report) recently signed a deal with bio-energy company, SG Preston to buy hydro-processed esters and fatty acids (HEFA)-based renewable jet fuel from the latter.
Under this agreement, JetBlue is expected to purchase over 33 million gallons of blended fuel per year from SG Preston over a period of 10 years. This deal is by far the largest, binding commitment for HEFA-based renewable fuel purchase over a long term by an airline company.
Notably, the use of this renewable fuel has been deemed safe by the Federal Aviation Administration (“FAA”). JetBlue’s business partners had assessed this type of renewable fuel in 2011 and found it to be usable through tests coordinated by members of ASTM International, which develops standards for fuels used in the aviation industry.
Deal and Renewable Fuel Details
The global airline industry is committed to curbing greenhouse gas emissions from 2020 onward and the use of renewable energy is one of the best measures to be adopted by airline companies in this regard. To date, over 2,200 commercial flights by 22 airlines use various types of renewable jet fuel, including the HEFA-SPK type produced by SG Preston.
The aforesaid renewable fuel is created from rapidly renewable, bio-based feedstocks that do not compete with food production. Notably, this fuel has the capacity to reduce carbon emissions up to 50%. The blended fuel to be used by JetBlue will comprise 30% renewable jet fuel in addition to 70% usual Jet-A fuel. Importantly, the fuel is expected to meet the standards of both Environmental Protection Agency’s (“EPA”) requirements for renewable fuel standards and Roundtable on Sustainable Biomaterials certification standard for sustainable production of biofuels.
JetBlue will provide the blended fuel for New York-metropolitan area airports. The total renewable fuel to be purchased by JetBlue would equal almost 20% of the annual fuel consumption by the company at New York’s John F. Kennedy International Airport. The company believes that the use of renewable fuels will eventually benefit its bottom line and contribute to the reduction of carbon emissions while maintaining safety standards.
Investors might also take a look at other well-placed stocks in the airline space like ANA Holdings (ALNPY - Free Report) and SkyWest Inc. (SKYW - Free Report) . Both these stocks carry a Zacks Rank #2 (Buy).
(We are reissuing this article to correct a mistake. The original article, issued on Sep 20, 2016, should no longer be relied upon.)
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JetBlue Signs Mega Renewable Fuel Deal with SG Preston (Revised)
In order to reduce carbon emissions, JetBlue Airways Corp. (JBLU - Free Report) recently signed a deal with bio-energy company, SG Preston to buy hydro-processed esters and fatty acids (HEFA)-based renewable jet fuel from the latter.
Under this agreement, JetBlue is expected to purchase over 33 million gallons of blended fuel per year from SG Preston over a period of 10 years. This deal is by far the largest, binding commitment for HEFA-based renewable fuel purchase over a long term by an airline company.
Notably, the use of this renewable fuel has been deemed safe by the Federal Aviation Administration (“FAA”). JetBlue’s business partners had assessed this type of renewable fuel in 2011 and found it to be usable through tests coordinated by members of ASTM International, which develops standards for fuels used in the aviation industry.
Deal and Renewable Fuel Details
The global airline industry is committed to curbing greenhouse gas emissions from 2020 onward and the use of renewable energy is one of the best measures to be adopted by airline companies in this regard. To date, over 2,200 commercial flights by 22 airlines use various types of renewable jet fuel, including the HEFA-SPK type produced by SG Preston.
The aforesaid renewable fuel is created from rapidly renewable, bio-based feedstocks that do not compete with food production. Notably, this fuel has the capacity to reduce carbon emissions up to 50%. The blended fuel to be used by JetBlue will comprise 30% renewable jet fuel in addition to 70% usual Jet-A fuel. Importantly, the fuel is expected to meet the standards of both Environmental Protection Agency’s (“EPA”) requirements for renewable fuel standards and Roundtable on Sustainable Biomaterials certification standard for sustainable production of biofuels.
JetBlue will provide the blended fuel for New York-metropolitan area airports. The total renewable fuel to be purchased by JetBlue would equal almost 20% of the annual fuel consumption by the company at New York’s John F. Kennedy International Airport. The company believes that the use of renewable fuels will eventually benefit its bottom line and contribute to the reduction of carbon emissions while maintaining safety standards.
Zacks Rank and Stocks to Consider
JetBlue currently carries a Zacks Rank #3 (Hold). A stock in this industry with Zacks Rank #1 (Strong Buy) is Copa Holdings SA (CPA - Free Report) . You can see the complete list of today’s Zacks #1 Rank stocks here.
Investors might also take a look at other well-placed stocks in the airline space like ANA Holdings (ALNPY - Free Report) and SkyWest Inc. (SKYW - Free Report) . Both these stocks carry a Zacks Rank #2 (Buy).
(We are reissuing this article to correct a mistake. The original article, issued on Sep 20, 2016, should no longer be relied upon.)