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12 The Carbon Market: A Primer for Airports
1.4.1 Use of Airport Revenue and Revenue Diversion
There does not appear to be a likely violation of airport revenue use restrictions resulting from
the on-airport installation of alternative energy systems or offset-eligible projects, provided that
either (1) those facilities would be used directly by the airport or (2) the airport were compen-
sated appropriately for the use of airport land. For example, an airport generating renewable
power would likely have to retain any revenue accruing from the sale of excess power or RECs
to a utility company or to a third party for its own use. As such, one interpretation could be that
a municipal airport sponsor might be violating revenue use restrictions if it were to take the REC
revenues "downtown," i.e., to use them for municipal purposes not related to airport operations
without fair market value compensation to the airport. An analogous activity is that of revenue
generated from mineral extraction as set forth in the 1999 Policy and Procedures Concerning the
Use of Airport Revenue (FAA 2009).
In a power-purchase agreement (PPA)--a contract between an entity that generates power
and an entity that purchases and consumes electricity where a third party owns and operates
an alternative energy or offset-eligible project on airport property--the airport would need
to be compensated for the fair market value of the property. In some circumstances, where
a PPA project is conducted on property purchased with AIP noise grants, the FAA may
demand repayment of the grants. The FAA is starting to look at the release of this land for
non-aviation use.
1.4.2 Airport Layout Plan and Compatible Land Use
Before an airport sponsor can "sell, lease, encumber, or otherwise transfer or dispose of any
part of its title or other interests" in the airport, the FAA needs to approve the action, as part of
its grant assurances. Airport sponsors should coordinate with their Airport District Office before
entering into long-term leases for renewable energy and offset-eligible projects that result in
either a release of airport land or a change in the airport's land use. The FAA must approve all
land uses on airport property. Should the land uses interfere with the safety and efficiency of the
airport operation or other critical evaluation factors, they may not be approved. Wind farms and
solar farms alike could have safety implications at the airport. While solar farms are an increas-
ingly common site at airports, wind farms are not typically observed due to a number of factors,
such as their size and potential interference with radar technology.
Over 15 airports around the country are operating solar facilities and airport interest in solar
energy is growing rapidly. The FAA has published "Technical Guidance for Evaluating Selected
Solar Technologies on Airports" (FAA 2010b). This guidance, published in October 2010,
provides a checklist of FAA procedures to ensure that proposed photovoltaic or solar thermal
hot water systems are safe and pose no risk to pilots, air traffic controllers or airport opera-
tions. This checklist should be reviewed in detail, as a starting point for all airport sponsors
considering solar at their airport. Case studies of operating airport solar facilities are provided
within the guidance document, including Denver International Airport, Fresno Yosemite In-
ternational Airport, and Albuquerque International Sunport. The feasibility of solar projects,
as well as other renewable energy projects on airport grounds, will be discussed in later sections
of the Primer.
Land use in the vicinity of the airport is also governed by the grant assurances, which specify
that it must be compatible to the extent reasonable so as to minimize interference with airport
operations. However, airport operators do not directly control the use of off-airport land. This
restriction would limit the ability of the airport sponsor to "partner" with an adjacent landowner
to implement an offset-eligible project if that offset-eligible project is not compatible with the
airport operation.
