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CHAPTER 6
Trading Offset Credits and RECs
6.1 Implications of Retiring and Trading
Environmental Instruments
Key Takeaways for Airports
· An airport that sells its offset credits or RECs loses the ability to claim the environ-
mental attributes of that power.
· Airports must weigh the value associated with being an environmental steward
against the monetary value from selling offset credits or RECs.
As was discussed earlier in the Primer, there are two primary sources of value that can be
created for airport operators by hosting carbon offset and renewable energy projects. The first is
monetary--developers of projects can sell the environmental benefits of their projects in the
form of offset credits or RECs. The second is reputational value--an entity that wishes to reduce
their carbon footprint or comply with an environmental regulation can retain the environmen-
tal benefits from a project by retiring the credit. Generally a credit is retired through whatever
standard body, regulatory body, or tracking system issued it in the first place. The act of retiring
a credit effectively locks in the environmental attributes to the person or entity that elected to
retire the credit.
However, if an airport project host elects to sell the associated credits, the airport sponsor loses
the ability to claim the environmental attributes of that project. This can be a difficult idea to
conceptualize and it is worth considering the following example:
If an airport operator installs solar panels at its facility to generate electricity to serve the air-
port, and sells the RECs associated with it, they cannot claim that their airport is being powered
by solar energy. Even though the electricity the airport is consuming came from a solar panel,
the definition of a REC encompasses all of the environmental attributes of the renewable energy.
In the eyes of the environmental market, they are consuming non-renewable power. If an air-
port was, at least in part, motivated to host a renewable energy or offset project to reduce their
carbon footprint, then careful consideration should be made before selling the environmental
attributes of that project in the form of an offset credit or REC.
The decision to sell RECs in order to create additional revenue streams must be balanced
against the benefits of consuming renewable or "green" power. The value of the REC can vary
significantly based on the market into which it is being sold, ranging from approximately $1 to
$40/MWh for traditional RECs. Solar RECs can be priced as high as $600/MWh in select markets.
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