BLOG POSTS ARE PRELIMINARY MATERIALS CIRCULATED TO STIMULATE DISCUSSION AND CRITICAL COMMENT. THE VIEWS EXPRESSED ARE THOSE OF THE INDIVIDUAL AUTHORS. WHILE BLOG POSTS BENEFIT FROM ACTIVE UHERO DISCUSSION, THEY HAVE NOT UNDERGONE FORMAL ACADEMIC PEER REVIEW.
By Kimberly Burnett, James Mak and Christopher Wada
In late 2021, the United Nations (UN) held its 26th climate change conference (COP26) in Glasgow, Scotland. Among the many agreements that emerged from the conference was a coordinated plan for tourism climate action (Glasgow Declaration) to cut tourism’s global carbon emissions in half over the next decade and reach Net Zero emissions before 2050. Tourism currently accounts for roughly 8% of the world’s carbon emissions. The declaration aims to lead and coordinate climate actions across all tourism stakeholders, governmental and private. The plan envisions “offsetting” to play a subsidiary role in accelerating tourism’s decarbonization.
What is “offsetting”?
The UN defines “offsetting” as “a [voluntary] climate action that enables individuals and organizations to compensate for the emissions they cannot avoid, by supporting worthy projects that reduce emissions somewhere else.” (Thus, offsetting is different from a carbon tax that is intended to reduce polluting activities directly.) For example, a visitor couple arrives in Hawaii from Seattle for a one-week vacation; unavoidably they have to take a plane ride to get here. One way for the Seattle couple to offset their travel-related carbon emissions is to buy carbon offsets from a project that does reduce carbon emissions. Since greenhouse gas emissions anywhere in the world have the same impact on climate, the project need not be located in Hawaii. For example, the UN has many certified green projects in developing countries that reduce, avoid or remove greenhouse gas emissions from the atmosphere. There is a wide variety of projects, from hydroelectric projects to wind and solar farms to installation of more efficient cook stoves. Once the emission reduction achieved by a project has been verified, the UN issues Certified Emission Reduction certificates (CERs) to the project operator; one CER for each metric ton of CO2 reduced or avoided. Interested individuals and organizations can purchase CER units awarded to these projects and have them cancelled. There are numerous firms that act as brokers for carbon offset credits. For individuals who wish to buy only a small number of offset credits, the most convenient way is to go to a retailer.
The non-profit Sustainable Travel International organization has a new on-line calculator that computes the amount of CO2 emitted for a given trip (flight, car, and boat travel) and allows individuals to purchase carbon offsets. For the couple traveling from Seattle to Honolulu, round-trip CO2 emitted is estimated at 2.4 metric tons, and the cost to offset the emissions is $29.66, or about $12.40 per metric ton of CO2 offset. Adding a rental car that’s driven 300 miles during the week (.08 metric tons of CO2 emitted) would increase the total offset cost to $30.65. If the couple flies to Hawaii to takes a 7-day ocean cruise (no rental car will be needed then), the total carbon footprint rises to 6.50 metric tons and it would cost $80.34 to offset the CO2 emissions. (The organization’s calculator cannot produce estimates of carbon emissions from other local components of a vacation, such as lodging, meals, etc. However, what matters is the difference between the tourists’ emissions at home versus that in Hawaii; the difference is likely to be quite small once the flight, car rental and the ocean cruise are excluded. Obviously, the calculator, by construction, is a simplification of reality.) The dollars support certified carbon reduction projects around the world.
A 2019 survey of American travelers by Destination Analysts learned that 25% of them have heard of “carbon offsets,” and 23% of American travelers have actually purchased them for their travels. The decision to buy, or not to buy, is personal and voluntary. The survey revealed that the most frequently given reasons for purchasing offsets were: “The cost was reasonable” (37.8%), and “I want to be environmentally conscious/responsible” (37.8%). When travelers were asked in the survey what is the maximum they would be willing to pay to fully offset their personal carbon emissions on their next vacation, over half of the respondents either didn’t know (25.4%) or were unwilling to pay anything (25.0%); 17.2% of the respondents said they were willing to pay a maximum of between $1 and $20, and another 9.4% were willing to pay between $21 and $40. Only 4.6% of the respondents were willing to pay over $100 for their next trip. Carbon offsets usually cost between $5 to $30 per person for a trip, and depending on the type and distance of travel, the total cost for a party of two ranges between $10 and $60.
The Coconut Traveler
More businesses around the world are setting internal carbon prices on each ton of carbon emitted to encourage them to reduce carbon emissions. Microsoft currently charges a business travel fee of $15 per metric ton of carbon dioxide equivalent for its employee travel; the fee goes up to $100 per metric ton starting from July 2022. The money collected remains within Microsoft, and is spent on projects that will help it become a greener company.
Here in Hawaii, The Coconut Traveler, a company that specializes in customized, luxury travel in the Hawaiian Islands has developed a “Responsible Tourism Fee” (RTF) that takes into account carbon emissions by its clients. The company developed its own calculator that computes an RTF for each client and adds it to the travel invoice. For two guests from Seattle, The Coconut Traveler’s calculator estimates the amount of carbon emissions they generate during their flight (round trip) and (separately) the amount they generate during their week-long vacation in Hawaii. The sum (measured in metric tons) is multiplied by an assumed price of $40 per metric ton (it was $11 per metric ton until last year). For this couple, the RTF is $240 for 6 metric tons of carbon emissions (at $40 per metric ton). (The same if the guests originate from San Francisco, Los Angeles or Portland, Oregon. If they are flying in from New York City, Chicago, or Dallas, the RTF rises to $320 for 8 metric tons of CO2 emissions). Debbie Misajon, owner of The Coconut Traveler, concedes that “It’s not a science, but it is a formula.” So far very few people have refused to pay the fee; when they refused, she paid them out of the company’s profits. Indeed, she shares that almost no one asks what the fee is.
Obviously, where the money is allocated is critically important to what benefits are obtained. Misajon explains that charging high-end guests isn’t a problem; it is finding organizations/projects to support that has been the biggest challenge. Thus far, she hasn’t found a compelling carbon offset project in Hawaii to which she could attach the RTF exclusively. All the money collected from the Responsible Tourism Fee (expected to generate $60,000 in 2022) has been donated to several organizations in Hawaii. Some of the RTF revenue is being donated to ReTree Hawaii, a local NGO that is planting trees on every major Hawaiian island. The charity is chosen because its core mission aligns with Hawaii’s pledge to plant 1 million trees by 2030. Some has gone to support the Hawaii Association of Watershed Partnerships (HAWP) which works to protect vital forested watershed lands that mitigate the effects of climate change by absorbing CO2. Planting trees and forest restoration are among the most effective solutions to fight climate change.
On the other hand, some of the revenues from the RTF also support organizations not focused on mitigating climate change; among them is Malama Na Honu, a local sea turtle conservation charity. The non-profit has done good work at local beaches to reduce disturbance to basking turtles.
Having signed up with Tourism Declares (a global community of over 400 tourism organizations) in declaring a climate emergency, The Coconut Traveler has pledged to take “purposeful action” to reduce global carbon emissions. But it acknowledges that it doesn’t pretend to fully offset carbon emissions from its client’s trips. The RTF provides a formula—a standard method—to raise revenue from its clients to support local organizations whose work benefit the local community directly in a variety of ways and who cannot get support from the State’s transient accommodation tax (TAT). Thus, the company has a broader environmental focus (more than just carbon offsetting) and narrower (only Hawaii) geographic locus. By contrast, Hawaiian Airlines just announced that it is partnering with Conservation International to offer carbon offsets on its flights to support forest conservation projects like the Chyulu Hills Redd+ project in southeast Kenya.
Travel companies elsewhere are doing something that is similar to The Coconut Traveler. For instance, the Globus Family of Brands (which includes Globus, Cosmos, Monograms and Avalon Waterways) just announced its Lighthouse Project which “invites travelers and partners in supporting causes for a more sustainable planet.” The Lighthouse Project names specific people and planet initiatives it supports and asks for donations. These initiatives include: Wildlife Conservation Network Lion Recovery Fund, Trees4Travel, The Ocean Cleanup, UNICEF and Rural Aid.
The Glasgow Declaration notes that offsetting may have a subsidiary role in reducing global carbon emissions, but it must be complementary to real reductions. While The Coconut Traveler’s business model is well-aligned with tourism climate action goals set forth by the Glasgow Declaration, multiple challenges remain in widespread voluntary adoption of this model, including identification of appropriate organizations to donate to, as well as a clearer connection between the organization’s carbon offsetting activities and estimated carbon reduction. Additional measures to make these organizations and their estimated carbon reduction levels more transparent would incentivize more participation in these types of programs, thereby supporting the Glasgow Declaration and helping to accelerate tourism’s overall decarbonization. As the latest report (April, 2022) from the Intergovernmental Panel on Climate Change (IPCC) warns: there is a dire need to decrease global greenhouse gas emissions immediately and on a much larger scale than before.
Acknowledgements: The authors would like to thank Erik Haites and Debbie Misajon for helpful comments on earlier versions of this essay.
3 thoughts on “Private Actions to Combat Climate Change Through Offsetting: The Story of The Coconut Traveler”
Very educational, excellent work I was not aware of. Being a retired hospitality executive, it’s great to learn how things are advancing for Future & travel.
Bravo Debbie and The Coconut Traveler. “It’s not a science, but it is a formula.” While CO2 measurements won’t be exact without investing $$$ in them, by taking this approach you and your guest are making a positive impact that’s substantial. 👏
Thank you for spotlighting our effort! We hope to make significant positive impact on the destination which supports our families.