Alaska Airlines launches investment arm to support goal of net-zero carbon emissions by 2040

An electric-powered aircraft from Beta Technologies, a startup backed by UP.Partners, a new partner with Alaska Star Ventures (Beta Technologies Photo)

Alaska Airlines on Monday announced the launch of Alaska Star Ventures to invest in new aviation technologies as part of the airline’s goal to reach net zero carbon emissions by 2040.

For its first partnership, the new Alaska subsidiary will invest $15 million with venture capital firm UP.Partners. Alaska’s investment is part of a new $230 million UP.Partners venture fund backing early-stage transportation and mobility technology companies, also announced Monday.

Alaska Star Ventures is exploring additional future investments in other sector focused funds and individual companies, said Diana Birkett Rakow, Alaska’s vice president of public affairs and sustainability, in an interview with GeekWire.

“Our filter is how do we get our operation to net zero and what are technologies that can help us along that path,” said Rakow. She added: “Part of our partnership with UP is to gain the benefit of what they’re seeing in their deal flow and with their expertise, and then also sort of watch how they do that work as we also talk with a variety of other technology companies.”

Diana Birkett Rakow, Alaska’s vice president of public affairs and sustainability (PRNewsfoto/Alaska Airlines)

This April, Seattle-based Alaska set its net zero emissions goal and joined The Climate Pledge, an Amazon-led initiative to limit emissions that includes more than 100 companies.

Alaska’s plan has five segments: Renewing its fleet with more efficient airplanes like Boeing’s 737-9 MAX; increasing operational efficiency; using sustainable aviation fuel; increasing the use of electric or alternative power; and harnessing carbon offset technology.

“We really want sector focused either funds in energy or aviation or mobility, or individual discrete companies that can help us in one of those five segments,” said Rakow.

Net zero carbon emissions is tall order for the airline industry, admitted Rakow. “Climate change is one of our biggest global problems, aviation is one of the most challenging sectors to decarbonize,” she said. However, “the fact that technology is actually actively developing solutions for that problem right now, I think is a really cool confluence.”

Rakow points to existing Alaska programs, such as its use of “Flyways” software from startup Airspace Intelligence to efficiently map out routes.

In April, Alaska signed a “memorandum of understanding” to increase investment in sustainable aviation fuel with SkyNRG Americas, which is developing production facilities to generate fuel from municipal waste and other waste products. The two companies also have a partnership with Microsoft, which aims to offset employee flights with SkyNRG fuel credits for trips between Seattle and California.

Ultimately, electric-powered options may have the potential to take over some routes, particularly shorter, regional hops, said Rakow. UP.Partners’ portfolio includes Amazon-backed Beta Technologies, which is developing an electric-powered aircraft that takes off and lands vertically.

Santa Monica, Calif.-based UP.Partners was founded in 2019 by Ben Marcus and Cyrus Sigari, who earlier co-founded business aircraft seller jetAVIVA and Airmap, a traffic management platform for drones and flying cars. Other companies backed by UP.Partners include drone and flight autonomy company Skydio and UnitX, which generates software inspection systems for automated manufacturing.

The United Nations estimates that airplane emissions of carbon dioxide will triple by 2050, adding urgency to Alaska’s efforts and similar programs at some other airlines.

United Airlines has a goal of obtaining net zero emissions by 2050 and this June launched a new venture capital arm. JetBlue also has a net zero target for 2040 and a venture arm, JetBlue Technology Ventures, that invests in “improving travel and hospitality.”

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Transportation Alaska airlines Ben marcus Cyrus sigari Diana burkitt rakow Up.partners