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CHAPTER 2 Carbon Offset and Value Opportunities for Airports 2.1 Offset Credit Origination Key Takeaways for Airports There are a handful of airport projects with offset credit potential but not all GHG emission reducing activities at an airport will result in offset credits that have value in carbon markets. Typically, offset credit buyers will want the offset projects to have been regis- tered with an offset standard body. As new types of carbon offset projects become eligible for offset origination, air- port sponsors should assess whether to retain the rights to each project's offset credits or to instead allow tenants to retain them. A carbon offset project describes an activity that reduces, avoids, or sequesters GHGs in order to compensate for emissions occurring elsewhere. Offset projects can cover a wide variety of activities and installations. Theoretically, an airport sponsor could claim any activity that results in a net decrease in carbon emissions as an offset; however, not all offset activities carry mone- tary value in carbon markets. Buyers in the carbon market often want assurances that the offset credit they are buying is of a certain quality or type. Offset standards bodies serve an important role in the offset market by developing, verifying, and quantifying GHG emission reductions from various activities. An overview of offset standards bodies is contained in Section 2.2.1. Without the backing of an offset standard body, it may be difficult to create revenue from some projects that reduce GHG emissions. Regardless of the offset project type or standards body, there are generally five common cri- teria that all offset projects must meet in order to ensure crediting for reducing GHG emissions (World Resources and World Business Council for Sustainable Development 2004): 1. Real--An actual unit of GHG must have been reduced, avoided, or sequestered. 2. Permanent--The activity must result in a reduction, avoidance, or sequestration that will not be reversed. 3. Additional--The project must have been undertaken in response to an incentive created by a carbon offset market. For example, the activity cannot have been required by law or cost effective not accounting for value of the offset credit. 4. Verifiable--The project sponsor has to be auditable to show that an actual reduction took place. 5. Enforceable--Projects generally have to be backed by legal contracts or other legal instru- ments that define their creation and ensure exclusive ownership. 14