Delta Air Lines Inc.: 10-K Risk Factor Changes

Many aspects of our operations are subject to evolving and increasingly stringent federal, state, local and international laws governing environmental protection. Compliance with existing and future environmental laws and regulations could require capital investment and increase operational costs, and violations can lead to significant fines and penalties and reputational harm. For example, in 2024, the EPA finalized regulations defining certain PFAS as "hazardous substances" under CERCLA, and the EPA also finalized standards for regulating certain PFAS under the Safe Drinking Water Act. PFAS are man-made chemicals that have been used in a wide variety of consumer and industrial products, including the firefighting foams used to extinguish fuel-based fires at airports and refineries. Numerous states have also adopted regulations governing PFAS. The EPA’s final rule under CERCLA, and analogous state laws, could subject airports, airlines, and refineries, among others, to potential liability for cleanup of historical PFAS contamination associated with use of PFAS-containing firefighting foam. In addition, some states have adopted legislation prohibiting the manufacture, sale, distribution and/or use of firefighting foam containing intentionally added PFAS, which may require the transition to alternative fire suppression systems. Delta has developed and is implementing plans to transition the fire suppression systems in affected aircraft maintenance hangars to systems that do not contain intentionally added PFAS. The ultimate impact and associated cost to Delta of these legislative and regulatory developments related to PFAS, including firefighting foam, cannot be predicted at this time. Delta Air Lines, Inc. | 2025 Form 10-K24 Delta Air Lines, Inc. | 2025 Form 10-K24 Delta Air Lines, Inc. | 2025 Form 10-K24 Delta Air Lines, Inc. | 2025 Form 10-K 24 Delta Air Lines, Inc. | 2025 Form 10-K24 Delta Air Lines, Inc. | 2025 Form 10-K24 Delta Air Lines, Inc. | 2025 Form 10-K 24 Delta Air Lines, Inc. | 2025 Form 10-K24 Delta Air Lines, Inc. | 2025 Form 10-K 24 Delta Air Lines, Inc. | 2025 Form 10-K 24 Item 1A. Risk Factors Item 1A. Risk Factors Item 1A. Risk Factors Future regulatory action concerning climate change, aircraft emissions and noise could have a significant effect on the airline industry. In order to address aircraft carbon dioxide emissions, the International Civil Aviation Organization ("ICAO"), a United Nations specialized agency, formally adopted a global, market-based emissions offset program known as CORSIA. This program established a goal for the aviation industry to achieve carbon-neutral growth in international aviation beginning in 2021. Any growth above the baseline would need to be addressed using eligible carbon offsets and/or lower carbon fuel. ICAO set the baseline for establishing airlines’ obligations under CORSIA for 2021 to 2023 based on 2019 travel, and in 2022 set a new, more stringent CORSIA baseline of 85% of 2019, which will apply from 2024 through 2035. Because CORSIA has not yet been implemented in the United States and could potentially be affected by political developments in participating countries or the results of the initial phases of the program, the impact of CORSIA cannot be predicted at this time. However, compliance with CORSIA is expected to increase operating costs for airlines subject to the program that operate internationally. In addition to CORSIA, we may face a patchwork of regulation of aircraft emissions in the U.S. and abroad and could become subject to further taxes, charges or additional requirements to obtain permits or purchase allowances or emission credits for greenhouse gas emissions in various jurisdictions. For example, in 2023, the EU adopted updated legislation on the EU Emissions Trading System (“ETS”). That legislation continues in effect the so-called “stop-the-clock” provision whereby EU ETS does not apply to flights to or from locations outside the EEA, Switzerland or the UK until 2027. The legislation also provides for a review of the effectiveness of CORSIA in 2026 that could, if CORSIA is not deemed sufficiently effective, lead to the application of EU ETS to all flights departing the EU and EEA, which would increase costs. Also in 2023, the EU adopted legislation that established a SAF mandate on fuel supplied at EU airports. Beginning in 2025, the mandate required 2% of the jet fuel supplied in the EU to be SAF, and the percentage increases incrementally over time to 70% in 2050. This mandate has increased SAF prices in the EU for the airline industry. In 2024, the UK also adopted SAF mandate legislation, and other countries are also considering mandates. Additional regulation could result in taxation, regulatory or permitting requirements from multiple jurisdictions for the same operations and significant costs for the airline industry, including Delta. In addition to direct costs, such regulation could result in increased fuel costs passed through from fuel suppliers affected by any such regulations. While the specific nature of future actions is hard to predict, new laws or regulations related to environmental matters adopted in the U.S. or other countries could impose significant additional costs on or otherwise adversely affect our operations. Certain airports have also adopted, and others could in the future adopt, greenhouse gas emission or climate-related goals and requirements that could impact our operations or require us to make changes or investments in our infrastructure. We are monitoring and evaluating the potential impact of such developments. In addition to risks from potential changes to environmental regulation and policy, the transition to lower-carbon technologies, such as SAF, or changes in consumer preferences resulting from a negative perception of the environmental impact of air travel could materially adversely affect our business and financial results. For example, lower-carbon technologies such as SAF and direct air capture technologies are currently not available at scale and may take decades to develop, and the cost to transition to them could be prohibitively expensive without appropriate government policies and incentives in place.

Many aspects of our operations are subject to evolving and increasingly stringent federal, state, local and international laws governing environmental protection. Compliance with existing and future environmental laws and regulations could require capital investment and increase operational costs, and violations can lead to significant fines and penalties and reputational harm. For example, in 2024, the EPA finalized regulations defining certain per- and polyfluoroalkyl substances ("PFAS") as "hazardous substances" under the Comprehensive Environmental Response Compensation and Liability Act ("CERCLA"), and the EPA also finalized regulations establishing drinking water standards for certain PFAS under the Safe Drinking Water Act. PFAS are man-made chemicals that have been used in a wide variety of consumer and industrial products, including the firefighting foams used to extinguish fuel-based fires at airports and refineries. Numerous states have adopted regulations governing PFAS as well. The EPA’s final rule under CERCLA, and analogous state laws, could subject airports, airlines, and refineries, among others, to potential liability for cleanup of historical PFAS contamination associated with use of PFAS-containing firefighting foam. In addition, some states have adopted legislation prohibiting the manufacture, sale, distribution and/or use of firefighting foam containing intentionally added PFAS, which may require the transition to alternative fire suppression systems. The ultimate impact and associated cost to Delta of these legislative and regulatory developments related to PFAS, including firefighting foam, cannot be predicted at this time. Delta Air Lines, Inc. | 2024 Form 10-K25 Delta Air Lines, Inc. | 2024 Form 10-K25 Delta Air Lines, Inc. | 2024 Form 10-K25 Delta Air Lines, Inc. | 2024 Form 10-K 25 Delta Air Lines, Inc. | 2024 Form 10-K25 Delta Air Lines, Inc. | 2024 Form 10-K25 Delta Air Lines, Inc. | 2024 Form 10-K 25 Delta Air Lines, Inc. | 2024 Form 10-K25 Delta Air Lines, Inc. | 2024 Form 10-K 25 Delta Air Lines, Inc. | 2024 Form 10-K 25 Item 1A. Risk Factors Item 1A. Risk Factors Item 1A. Risk Factors Future regulatory action concerning climate change, aircraft emissions and noise could have a significant effect on the airline industry. In order to address aircraft carbon dioxide emissions, the International Civil Aviation Organization (ICAO), a United Nations specialized agency, formally adopted a global, market-based emission offset program known as CORSIA. This program establishes a goal for the aviation industry to achieve carbon-neutral growth in international aviation beginning in 2021 through the use of carbon offsets and/or lower carbon aviation fuel. ICAO set the baseline for establishing airlines’ obligations under CORSIA for 2021 to 2023 based on 2019 travel, and in 2022 set a new, more stringent CORSIA baseline of 85% of 2019, which will apply from 2024 through 2035. Because certain CORSIA program details remain to be developed and could potentially be affected by political developments in participating countries or the results of the initial phases of the program, the impact of CORSIA cannot be predicted at this time. However, compliance with CORSIA is expected to increase operating costs for airlines that operate internationally. In addition to CORSIA, we may face a patchwork of regulation of aircraft emissions in the U.S. and abroad and could become subject to further taxes, charges or additional requirements to obtain permits or purchase allowances or emission credits for greenhouse gas emissions in various jurisdictions. For example, in 2023, the EU adopted updated legislation on the EU Emissions Trading System (“ETS”). That legislation continues in effect the so-called “stop-the-clock” provision whereby EU ETS does not apply to flights to or from locations outside the EEA, Switzerland or the UK until 2027. The legislation also provides for a review of the effectiveness of CORSIA in 2026 that could, if CORSIA is not deemed sufficiently effective, lead to the application of EU ETS to all flights departing the EU and EEA. Also in 2023, the EU adopted legislation that will impose a SAF mandate on fuel supplied at EU airports. The mandate initially requires that, of the jet fuel supplied in the EU, 2% must be SAF beginning in 2025, and the percentage increases incrementally over time to 70% in 2050. This mandate is expected to increase the cost of SAF in the EU. In 2024, the UK also adopted SAF mandate legislation, and other countries are considering mandates. Additional regulation could result in taxation, regulatory or permitting requirements from multiple jurisdictions for the same operations and significant costs for the airline industry, including Delta. In addition to direct costs, such regulation could result in increased fuel costs passed through from fuel suppliers affected by any such regulations. While the specific nature of future actions is hard to predict, new laws or regulations related to environmental matters adopted in the U.S. or other countries could impose significant additional costs on or otherwise adversely affect our operations. Certain airports have also adopted, and others could in the future adopt, greenhouse gas emission or climate-related goals and requirements that could impact our operations or require us to make changes or investments in our infrastructure. In addition to risks from potential changes to environmental regulation and policy, the transition to lower-carbon technologies, such as SAF, or changes in consumer preferences resulting from a negative perception of the environmental impact of air travel could materially adversely affect our business and financial results. For example, lower-carbon technologies such as SAF and direct air capture technologies are currently not available at scale and may take decades to develop, and the cost to transition to them could be prohibitively expensive without appropriate government policies and incentives in place.