Developing a Business Case for Renewable Energy at Airports (2016)

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1 Organizations prepare a business case analysis to engage in a thorough investigation of the alternatives to a proposed project. Increasingly, business value is being measured not only by the immediate and quantifiable financial metrics, but also through consideration of the self-sustainability, environmental, and social benefits. Airports are not only self-sustaining businesses and agents of governments; they are also critical components of the regional and national transportation infrastructure. This puts them in a unique position to make credible arguments that support both the financial and policy objectives of an organization pursuing long-term self-sustainability. This report provides airports with instruction and tools to help them develop a business case that maximizes the benefits of renewable energy opportunities. It presents the busi- ness case as a comprehensive planning exercise supporting a specific objective (e.g., energy stability, reliability) and integrates it into the airport’s typical decision-making process. It provides a systematic approach to combine the application of near-term financial measures that are typically considered in business planning along with value for self-sustainability benefits associated with long-term investments and the environmental and social benefits that are important to the airport in its governmental responsibilities. The research supporting the guidance focuses on identifying and communicating the inherent benefits of renewable energy as part of the business case analysis. To reinforce its practical application, this report presents direct experience in developing a business case for renewable energy to show how those attributes are valued differently by different organiza- tions with different missions and how this broader renewable energy business experience translates to the airport business. • Chapter 1 lays out what a business case is, why renewable energy is important, what renewable energy technologies should be considered and when, and what a business case for renewable energy at airports looks like. • Chapter 2 describes how an airport can justify its renewable energy project by identifying key objectives and how the project fits into the airport’s vision. • Chapter 3 reviews the criteria used to evaluate a renewable energy project and presents a sys- tem for weighting each factor, including long-term self-sustainability and environmental/ social considerations, based on the airport’s particular objectives. • Chapter 4 describes how an airport should integrate the proposed project into its stan- dard master planning and capital planning process. • Chapter 5 identifies the key internal and external stakeholders whose participation is central to successful implementation. • Chapter 6 walks through a model business case and evaluates each of the factors funda- mental in the renewable energy business case. S u m m a r y Developing a Business Case for Renewable Energy at Airports

2 Developing a Business Case for renewable Energy at airports • Chapter 7 provides examples of similar renewable energy business cases from both an airport’s perspective as well as from the perspective of other industries and the lessons learned. • Chapter 8 guides airports in evaluating diverse funding opportunities. Some practitioners may spend time reviewing the entire report as it lays the groundwork for the benefits of renewable energy and how these projects can be applied to airports. Others may want to focus on the model business case provided in Chapter 6 to go beyond the theory and see how a business case for on-site energy decisions is developed. The business case examples provided in Chapter 7 provide a clear illustration of what different organizations are doing in the renewable energy area and why. Regardless of how one uses the report, it represents a change in thinking for most in view- ing the future where airports will continue to execute their missions of providing safe and efficient air travel to the general public while navigating an increasingly unpredictable energy landscape, which is critical to its core functionality. The challenge for airports is to adapt the business case examples to a business that is far from “usual,” to take advantage of opportuni- ties being revealed by technology and a changing energy industry, and to address challenges associated with securing airport operations in times of new and unanticipated risk. Renewable energy can be part of that solution.