Southwest Cares: Doing the Right Thing

Our Planet

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nvironmental Stewardship is a responsibility Southwest takes seriously, and efficient operations are the hallmark of our Company and the foundation of our environmental commitment.

Efficiency means effective use of resources (energy, people, and materials), and we strive to be as productive as possible while minimizing waste and protecting the Earth. We were founded on a commitment to efficiency, and, as such, Southwest is one of the world’s most efficient airlines. Over the decades, Southwest has been at the forefront of such efficiencies as paperless tickets, quick aircraft turnarounds, installation of winglets, and, more recently, the installation of fleet-wide advanced avionics. This focus on efficiency not only makes good business sense, it is the right thing to do.

Stewardship of the environment also means operating our business in compliance with the environmental regulations of the U.S. Environmental Protection Agency and all the governing agencies in the Cities and States in which we operate. Southwest is firmly committed to compliance and received no monetary penalties for environmental violations in 2008.

Last year, we published our first Environmental Stewardship Report, which was created to communicate to our Customers, Employees, Shareholders, and other Stakeholders what Environmental Stewardship means to Southwest. For 2008, we are publishing this more comprehensive “Southwest Cares” report to show how Southwest does the right thing by Our Planet, Our Communities, Our People, and Our Suppliers. Efficiency and respect for the environment have been an inherent part of our Culture and business approach since Southwest was launched in 1971. It is what has made us who we are today.

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Vision for our Environmental Future As we look to the future, we know climate change remains of vital importance to our industry and our Company. Southwest Airlines has committed $175 million over a six-year period to retrofit our fleet with advanced avionics to support Required Navigational Performance (RNP), the cornerstone of the Federal Aviation Administration’s Next Generation Air Traffic Control System. This dollar investment to retrofit our aircraft and train our Pilots is the most significant investment in RNP by an airline. Efficient flight paths are crucial to the airline industry in our efforts to reduce Greenhouse Gas Emissions (GHG). We estimate based on test flights that RNP will result in a minimum of six percent fuel savings. Based on our 2008 fuel burn, this would result in a savings of 90 million gallons of jet fuel per year for Southwest Airlines, thus eliminating aircraft emissions in excess of 876,000 metric tons of carbon dioxide equivalent on an annual basis.

Southwest is committed to the U.S. airline industry goal of at least a 30 percent improvement in fuel efficiency from 2005 levels by 2025. To meet this goal, the industry will need the support of Congress to draft legislation that provides incentives and funding for safe solutions to climate change, including alternative jet fuels and engine, airframe, and related infrastructure development.

As a Company, Southwest is implementing a more robust, systemwide recycling program at our Headquarters, airport operations, and on our aircraft. This systemwide co-mingled recycling program will take our current recycling efforts of paper, aluminum, cardboard, and plastic to the next level and let us fully maximize the potential we have to reduce, reuse, and recycle. Southwest is targeting year end 2009 for full implementation of new equipment and procedures.

As part of our sustainability strategy, Southwest is also committing resources to perform environmental audits of our waste and recycling vendors to ensure the environmental compliance of their operations and reduce our longterm environmental liability.

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Recycling and Waste Reduction Efficiency extends to every part of our business. Efficiency means elimination of unnecessary waste, and we take that meaning to heart. By identifying opportunities to reduce, eliminate, or recover energy from our waste streams, we improved our waste management efficiencies and diverted a substantial amount of material from landfills.

Minimizing and eliminating waste is not something Southwest has undertaken alone. By working with the airports we serve, informing our Customers, and carefully selecting our suppliers, we achieve efficiency in waste minimization and elimination. We work with suppliers that have the same environmental values we have. Together, we have implemented active programs to recycle the materials we use both on and off the aircraft to eliminate inefficiencies and excess waste where possible.

In 2008, our recycling program diverted more than 450 metric tons of waste from landfills. Our energy recovery program generated more than 4.8 billion British Thermal Units (BTUs) from used oil, filters, and liquid and solid paint waste, which were sent to industries where the BTU value can be recovered, diverting waste from incinerators and providing an alternative energy source. Here are some of the results of our waste minimization and recycling programs:

Recycling & Energy Recovery*

Recycled Materials	Recycled Solid Waste (Metric Tons)	Energy Recovery (BTUs)
Cardboard, paper, plastic, aluminum	217.8
Lamps	0.6
Batteries	118.3
Electronics	106.6
Used Oil	—	4,541,545,000
Filters, liquid & solid paint waste	11.8	285,240,000
	455.1	4,826,785,000

*Note: Energy recovery is based on recycling through fuel blending for energy intensive industries such as cement manufacturing. Energy contents are as follows: Used oil - 145,000 Btu/gallon (19,754 Btu/lb.); Paints/organic compound blends - 10,000 Btu/lb.; Paper components of used filters - 7,000 Btu/lb.

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Fuel & Emissions SavingsSouthwest is committed to continuing to lead the industry in emissions reductions through fuel efficiency. Efficiency in fuel consumption benefits our Company, as well as the environment, and this has been part of our business model since the beginning. Southwest has maintained our position as an industry leader in fuel efficiency and GHG reductions through comprehensive programs of reinvestment in equipment and technological innovation and partnerships with industry and government. Southwest supports the Air Transport Association of America’s commitment to voluntarily reduce GHG emissions. Through our partnership with the Environmental Protection Agency’s Blue Skyways Collaborative, we work with other members to voluntarily reduce emissions by sharing technology and professional expertise. To further demonstrate our commitment to improving fuel efficiencies and reducing emissions, our strenuous focus on conservation leads us to explore new and better ways to be efficient in our operations. Some of our initiatives are:

In the Air

Efficient Flight: Southwest adjusted flight profile speeds and flight altitudes in March 2008 in order to create additional efficiencies and to conserve fuel. From March 2008 through December 2008, the flight profile adjustments saved approximately 13.1 million gallons of fuel without affecting ontime performance and reduced emissions by 127,000 metric tons of carbon dioxide equivalent.

Aircraft Specific Performance Monitoring (APM): By establishing a specific fuel burn factor for each aircraft through APM, Southwest was able to more accurately gauge fuel needs for each flight. The result of APM is a small but measurable reduction in takeoff weight, which saved 4.4 million gallons of fuel in 2008, which equates to a reduction of 43,000 metric tons of carbon dioxide equivalent.

Winglets on -300 FLEET: Southwest operates one of the most efficient fleets in the world, comprised of Next Generation Boeing aircraft (737-700) and the Boeing Classic fleet (737-300 and -500). Southwest has winglets installed on all of our Next Generation aircraft and began the installation of winglets on our -300 fleet, identifying 90 aircraft for installation. By the end of 2008, Southwest installed winglets on 69 of the 90 aircraft, saving approximately 3.5 million gallons of fuel in 2008 alone.

On the Ground

Engine Washing: Using Pratt & Whitney’s EcoPower^® Engine Wash, Southwest washes four of our Boeing 737-700 engines each night. This has increased engine efficiency, and, from April 2008 through December 2008, saved 1.6 million gallons of fuel and reduced emission by 15,000 metric tons of carbon dioxide equivalent.

Ground idle speeds: The engines on our Classic fleet (CFM56-3) have a ground idle speed range adjustment, which allowed us to adjust the idle speed to minimize the amount of fuel consumed in ground taxi operations. From this one change alone, we estimate a savings of 3.1 gallons per hour while our aircraft are idling on the ground.

Gate Services: Since 2005 Southwest has been investing heavily in “gate services” electrification and, to date, we have converted to this process in 62 of the 64 cities we served at year end 2008. By providing electric power to our aircraft at the gates, we reduced aircraft auxiliary power unit (APU) fuel consumption and reduced emissions generated on the ground.

Our initiatives have steadily increased the efficiency of our operations, leading to a savings in fuel burn and a reduction of emissions. In 2008 alone, Southwest increased the fuel efficiency of our GSE fleet by 2.1 percent, and by a total of 6.7 percent since 2004, and we continue to improve.

Carbon Footprint: There is no denying that airlines burn fossil fuels—it is a fact of air transportation. But, how much we do to reduce our impact is important. That is why Southwest is committed to flying as efficiently as possible, thus eliminating wasteful fuel consumption and the associated emissions. Assessing our fleet of 537 Boeing 737s (at year end 2008), we calculated our fuel burn as 1.51 billion gallons of fuel for the full year, which equates to 14.6 million metric tons of carbon dioxide equivalent. Our fuel saving initiatives in 2008 yielded a savings of 33 million gallons and reduced emissions by 319,000 metric tons of carbon dioxide equivalent.

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Water Savings/Water Pollution Reductions Water is one of our most valuable resources and reducing our consumption is important to Southwest Airlines. There are several efforts underway to implement water savings, including:

• Low flow water saving plumbing for replacement and in new facilities
• Auto shutoff water faucets for replacement and in new facilities
• Meeting LEEDTM standards for efficient water use at many of our new facilities
• Landscaping with native and drought-tolerant plants
• Recycling the water used in our engine wash program

Along with reducing our water use, it is important that we keep water sources pure and support pollution prevention by reducing the chance of contamination. One of the significant changes we made in 2008 was using a new, more environmentally friendly Type-IV propylene glycol for aircraft anti-icing. When compared to earlier anti-icing formulations, the new fluid minimizes environmental impacts by 40 percent. Southwest also continuously works with the airports we serve to mitgate the environmental impact of deicing fluid by minimizing the amount of deicing fluid in our stormwater run-off through better design and construction of mannagement systems and annual training of our Employees on fluid application and management.

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Energy Use and Conservation Our position as an industry leader in fuel efficiency and reduction of carbon dioxide emissions is something we are very proud of and will continue to pursue. We recognize, however, that reduction of Greenhouse Gas emissions from our operations is only one part of an overall emissions reduction strategy. We are committed to pursuing Leadership in Energy and Environmental Design (LEED^®) standards in new construction. By taking steps to reduce the amount of energy we consume, and to purchase our energy from renewable resources, we can make a significant difference in our impact on climate change. We have initiated a number of programs and projects to reduce the amount of energy we consume, such as:

• Installation of lighting control systems that automatically shut-off office and facility lighting systems when not in use
• Meeting LEED^® standards at many new facilities
• Forming a LEED^® focus group for the Love Field Airport Modernization Plan in Dallas
• Where feasible, purchasing our power from renewable energy sources
• Participating in the Environmental Protection Agency’s Green Power Partnership Program by entering into a 60-month agreement with Reliant Energy to purchase 30 percent green e-certified renewable energy credits for our Dallas and Houston operations.

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Noise Southwest strives to be a good neighbor in every community we serve. Aircraft noise is something that can affect the quality of life of the communities located near our operations. As with other environmental issues, we have taken steps to mitigate this occurence by ensuring our entire fleet meets current aircraft noise standards. The addition of our winglets and engine modifications have yielded a quieter aircraft that creates less noise when taking off and landing, plus our Pilots typically use noise abatement procedures that enable us to minimize noise impact in communities near the airports we serve. At some of our Stations, we have partnered with the local airports to construct sound barriers and other noise mitigation features. Southwest will continue to seek innovative ways through investment in technologies to reduce the noise from our aircraft.

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Employee Involvement

The Green Team Southwest has a Team of Employee volunteers from across the organization dedicated to furthering our environmental efforts. The Green Team is comprised of Employees from all our business functions united under one common goal of enhancing the level of our Environmental Stewardship through daily action.

Green Team projects and participation include:

• Implementation of a robust, Companywide co-mingled recycling program
• Participating on committees to help identify areas of our operations where emissions can be reduced
• Development of Employee outreach programs on environmental issues so individual Southwest Employees can reduce their personal environmental footprints
• Development of external outreach programs to support Employee volunteerism addressing environmental issues
• Encouraging alternative transportation options where Southwest operates, including the investigation of Employee commuter programs
• Implementing “Green Tuesdays,” which provide tips each week to Employees on how to live and work green
• Development of a Green Ambassador program in each individual city Southwest serves to foster Environmental Stewardship

Green Team Goals include:

• Identify environmentally responsible efforts already in place
• Search for areas for improvement
• Make recommendations for environmentally responsible business practices
• Put a “green” filter on future business decisions

Each and every Southwest Employee remains committed to making our Company and our world a great place to be. All Employees are encouraged to actively participate in our recycling programs and provide outreach to our Customers on these programs. In addition, our Employees work hard to support our Environmental Stewardship commitment with volunteer projects and support of community initiatives across the country.

2007 Environmental Report (PDF Format)

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