Reference no: EM132896287
An audit of the impact of your airline on the environment found that you are in compliance with existing environmental laws and regulations. However, the report expressed concern about future changes in requirements and recommended being proactive about the CO2 emissions generated by your aircraft. There were two specific recommendations included in the report.
The first recommendation is to make modifications to the engines in your fleet that will reduce emissions while improving performance slightly. The work is expected to cost $50,000 per plane, allocated over 10 quarters, but the modifications should reduce fuel consumption by 2%.
The second option is the use of alternative jet fuel. Sustainable jet fuels are available which can be mixed with conventional fuel without modification of existing engines. The alternative fuel reduces life-cycle carbon emissions by up to 80% over regular jet fuel. Costs are estimated to be 2% higher for the alternative fuel if it is used in unmodified engines.
If you choose both options, there would be no net effect on your fuel costs. That is, your overall fuel expense would be the same whether you burn alternative fuel in modified engines or standard fuel in unmodified engines because the greater expense of the alternative fuel is balanced by the greater efficiency of the modified engines.
Both changes could be implemented in the next quarter. They would have no measurable impact on reliability or quality measures, though they might enhance the airline's reputation as environmentally friendly.
You can select either, both, or none of the options. What would you like to do?
1. Modify engines for cleaner performance. (Cost: $50,000 per plane)
2. Use alternative jet fuel. (Cost: 2% higher fuel cost)
Answer the below questions: Thx
A. What obligations do airlines have to the environment?
B. What benefits might investment in sustainable operations have on your firm?
C. Are there any risks if airlines do not initiate measures to reduce environmental impact on their own?
D. What choice did you make? Why?
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