Offset Providers

The choice of offset providers internationally continues to augment, while the Carbon Catalogue presently lists 12 providers across Canada with an offset price range of 12.50 $ to 39.90 $ per ton CO2e.(1) For those wishing to purchase offsets from organizations based in Québec, the four principal providers include Planetair,(2) Carbone Boréale,(3) Zero GHG Inc.(4) and ZÉRØCO2.(5)

(1) Planetair is a not-for-profit organization managed by the Unisféra International Centre, also a non-profit organization. (2) Planetair is the exclusive distributor of Myclimate, one of the most respected offset supplier worldwide, since all their projects conform to the Kyoto Protocol’s Clean Development Mechanism (CDM)* and Gold Standard.** These projects finance only renewable energy and energy efficiency projects in various developing countries. Planetair plans to offer Canadian projects in the future depending on sales volumes.

(2) Carbone Boréale (CB) is both a program, and a laboratory of researchers at the University of Québec in Chicoutimi. CB offsets finance tree plantations in a deforested area of Québec and contributes to supporting research. The plantations are verified and managed according to ISO 14064-3 norms, and are registered by the Canadian EcoProjectsTM GHG.(3)

(3) ZeroGHG Inc. is a private consultancy firm offering offsets in a variety of renewable and energy efficiency projects in addition to their consulting services to develop GHG reduction strategies, quantifying emissions and performing audits. ZeroGHG projects are located in various countries, and at least 80% must meet CDM* and Gold Standard**.(4)

(4) ZÉRØCO2 is a private enterprise selling offsets that finance reforestation projects in various communities. Since 2006, ZERØCO2 has reforested more than 20 hectares of land, creating green spaces equivalent to just over 40 football fields in the heart of communities. (5)

Indirect Offset Sellers

Some tourism businesses have partnered up with various offset-selling organizations. For example, since 2007, Air Canada (AC) encourages its customers to purchase offsets via non-profit organization ZeroFootprint that invests in forest restoration project in British Columbia. To date, AC customers bought $187,612 of offsets, equivalent of 11725 tones of GO2.(6) In contrast, Air Transat does not sell offsets for reasons relating to the efficiency of such projects in their ability to solve climate change related problems amongst other reasons.(7)

For those traveling by rail, VIA Rail also does not directly offer offsets to its customers, however it also encourages its customers to calculate their GHG emissions with Tree Canada, an Ottawa-based offset company. Since 1990, VIA Rail has reduced its GHG by 15% approximately, although it is responsible for only 0,03% of total GHG emissions compared to 13% generated by motorists in Canada.(8) For travelers that hire vehicles, numerous car rental companies also offer carbon offsets on-line such integrated into their reservation forms such as Alamo, Enterprise and National Car Rentals amongst others.(9)

Tourism Operations Buying Offsets

Some Québec and other travelers to Québec probably purchase offsets, however none of the above named organizations had data available at the time of writing this article about their clients. Some tourism operations also buy offsets in Québec, but no study assessed their transaction value to date.

Some accommodation establishments also have a carbon neutral policy. For example, the Chicoutimi Hotel has been offsetting its heating and electricity use and has been encouraging its clients to offset their stay with CB.(2) Since 2006, the hotel l’Auberge des Seigneurs in St-Hyacynthe has been offering Eco-Friendly Packages to its clients and in 2008, it has also engaged to calculate guest’s travel related GHG contributions amongst other environmentally friendly services.(10) This establishment also compensates emissions of meetings and events held in the hotel by planting trees. Similarly, in an effort to be carbon neutral, Novotel Montreal plants a tree for every online booking. (11)

Montreal based tour company, Karavanniers du monde has also taken climate change mitigation serirosly and since January 2009, its price structure includes carbon compensation costs with Planetair. (2, 12) The company’s client’s base is approximately 97% Québécois and based on discussions with the operation’ owner, there have been no complaints at all concerning the price increase resulting from mandatory carbon compensations. On the contrary, clients are pleased to see such an effort by the company. Some other travel companies such as Omnitour, Voyages Tour Étudiants also offers offsets to its customers. (2) Similarly, since 2006, the regional-based operation WeLa Aventure organizes eco-friendly hiking and cycling trips in the Saguenay,(13) and it compensated for its clients travel related CO2 emissions to and from the region via supporting tree plantations by ZIP Saugenay (14) and the cooperative COOP4Temps.(15)

Increasingly festivals and events across Québec are also eco-friendly, and some compensated for GHG emissions.(16) For example, since 2008, Montreal’s International Jazz Festival is carbon neutral.(17) Both Québec and Montreal Convention Centers offer eco-friendly events with their partner organizations (18, 19) and both centers offer offsetting as an option for such events. For example, In 2004, the Québec Convention Centre committed to reducing its energy consumption by 33% per m2 and its total GHG emissions by 50%.(20) Since 2007, it hosted 32 eco-friendly events of which 7 involved carbon compensations.

At Montreal’s Jean-Drapeau Park (JDP), sustainable development policy integrates GHG mitigation and compensation strategies for the organization and activities (about 100 events per year) on the park’s territory. (21) JDP created a fund (Fonds Oxygène) to implement this policy, and partners and suppliers will be asked to contribute to this fund, which will finance specific environmental improvement projects (22). Additionally, drivers to JDP will be required to pay $1 extra to leave their vehicles in the parking to help offset GHG emissions with CB.

Conclusion

Although it is well known that carbon compensation projects do not represent an ultimate solution to mitigating GHG emissions, the purchase of offsets in credible projects can raise awareness, and provide funds towards worthwhile initiatives.(23) Although buying offsets in tree plantations remains controversial, in certain cases they can deliver net environmental improvements, while buying offsets in renewable energy projects and technology developments permit a shift away from using fossil fuels.

This brief synopsis of the situation in Québec shows that carbon neutrality in the tourism sector is a patchwork. The analysis also highlights the need for measuring net contributions of greenhouse gases by the travel and tourism sector in order to enable a coordinated approach to assessing how this could be effectively mitigated.

* CDM certifies emission reductions that are sold on the voluntary market and it ensures that developed countries’ carbon credits comply with Kyoto Protocol regulations.
** The Gold Standard is an independent organization that certifies carbon credits sold on the voluntary market. Such carbon credits need to meet sustainable development objectives. This means that a carbon-offset project must lead directly to a net GHG emission reduction. Gold Standard does not certify forestry projects.

Sources:

(1) Carbon Catalogue Project: Find a Carbon Offset: Canada. Last Consulted Apr 25, 2009.  http://www.carboncatalog.org/projects/canada/
(2) Planetair. Offset Projects. Last Consulted Apr 2, 2009. http://planetair.ca/
(3) Éco-conseil. Plantations Compensatoires de GES. Last Consulted Apr 15, 2009.  http://dsf.uqac.ca/eco-conseil/ges/frame_ges.html
(4) ZeroGHG Inc. Last Consulted Apr 25, 2009.   http://www.zeroghg.com/
(5) ZeroCo2. Last Consulted Apr 15, 2009.  http://zeroco2.com/welcome.php
(6) Air Canada. Carbon Offset Program. Last Consulted Apr 25, 2009.  http://www.aircanada.com/en/travelinfo/traveller/zfp.html?src=hp_ql
(7) Transat AT (2009) Greenhouse gas reduction and fuel management. Last Consulted Apr 2, 2009. http://www.transat.com/en/social.responsibility/gas.reduction.fuel.management.aspx
(8) Via Rail Canada. Environment: Helping To Reduce Greenhouse Gas Emissions Last Consulted Apr 17, 2009. http://www.viarail.ca/corporate/en_environment/reducing_greenhouse_gas.html
(9) Terra Pass Inc. (2009) Rental Car Carbon Offset Program Proves Most Popular With Consumers. Published on-line in Earth News, April 6, 2009. Last Consulted Apr 25, 2009.  http://www.earthtimes.org/articles/show/rental-car-carbon-offset-program-proves-most-popular-with-consumers775734.shtml#%23
(10) l’Auberge des Seigneurs à St Hyacynthe. Last Consulted Apr. 24, 2009.
http://www.hoteldesseigneurs.com/notre_environment.asp
(11) Novotel Montréal Centre. http://www.novotelmontreal.com/home/novotel_news.shtm Last Consulted June. 2, 2009.
(12) Karavaniers du Monde. Destinatons: Fiche technique. Last Consulted Apr. 3, 2009.  http://www.karavaniers.com/voyages/calendrier/?voyage_depart=134
(13) Wela Aventure. Horaire et parcours. Randonnées des cols du Fjord 2009. Fiche d’information. Last Consulted Apr 25, 2009. http://www.welaaventure.com/
(14) ZIP Saguenay. Réalisations. Last Consulted Apr 27, 2009.  http://www.zipsaguenay.ca/zipsaguenay/index.php?option=com_content&task=category&sectionid=1&id=5&Itemid=12
(15) Coop Quatre Temps. Mission. http://www.coop4temps.com/ Last Consulted Apr 27, 2009.
(16) Réseau québécois des femmes en environnement. Sustainable Event. Last Consulted Apr 2, 2009. http://www.evenementecoresponsable.com/
(17) Festival International de Jazz de Montréal. Une édition 2008 carboneutre. Last Consulted Apr 27, 2009.  http://www.montrealjazzfest.com/Fijm2008/planetAir_fr.aspx
(18) Centre des congrès de Québec. Développement Durable. Évennements éco-responsables. Last Consulted Apr 27, 2009.  http://www.convention.qc.ca/tiki-index.php?page=devdurable_eve_resp
(19) Palais des congrès de Montréal. Environnement. Last Consulted Apr 2, 2009. http://www.congresmtl.com/fr/visiteurs/environnement.aspx
(20) Centre des congrès de Québec. Lauréate du prix Stellaris: Efficacité Énergétique. Press Release 2 April, 2004. Last Consulted Apr 2, 2009. http://www.convention.qc.ca/tiki-read_article.php?articleId=41
(21) Société du parc Jean-Deapeau (2009) Politique de développement durable. Montréal. 8 p.
(22) Société du parc Jean-Deapeau (2009) Fonds Oxygène.Le fonds de compensation de gaz à effet de serre Montréal. 4 p.
(23) Broderick, J. (2008). Voluntary Carbon Offsets. A Contribution to Sustainable Tourism? In Sustainable Tourism Futures. Perspectives on Systems, Restructuring and Innovations. In Gössling, S., Hall, C.M. and Weaver, D.B. (Eds.). Routledge, New-York. 169-197.

Leisure travel

In 2006, leisure travel will continue to drive tourism growth. According to some US experts, rest and relaxation motivate more than half of all leisure travellers. Destinations like spa resorts and those offering a stress-free atmosphere look the most promising. A recent Tripadvisor.com survey showed that 50% of the 3000 respondents planned to take a spa vacation in the next year. With short stays still in vogue, the challenge facing the industry is to offer the most relaxation within the shortest amount of time.

Visits to national parks will rise, while attendance at amusement parks will drop. The cruise industry should continue its upward climb and enjoy an excellent year, notably due to the launch of new boats and the growing popularity of this product among families. Timeshares on cruise ships have been identified as a promising new trend in the coming years.

Cities that emphasize fun and a wide variety of activities within a small area – ideally within walking distance – are likely to attract more travellers. And, finally, the increased demand for leisure travel has led experts to encourage consumers to reserve early to ensure that what they want is available at the desired time.

Business travel

North American business travel will enjoy a good year with projected growth of 5% in 2006, compared to the 4% recorded in 2005. This increase will be driven primarily by the meetings and conventions sector. However, for their daily corporate needs, business people continue to seek alternatives to having to travel for business.

Recent forecasts from Meeting Professionals International (MPI) confirm a 7% increase in meeting expenditures and the number of events for next year. This forecast is based primarily on national markets, because American and European organizers do not expect more events to be held at international destinations. In Canada, the number of visitors attending American conventions should remain stable.

Good news for suppliers: MPI anticipates that convention lead times will begin to increase. In 2006, it is estimated that lead times will grow by nearly 40%, translating into an additional two or three months between the invitation to tender and the event date.

Hotels

In North America, increased demand and slow growth in supply means average room rates should continue to rise in 2006. The upscale and luxury sectors in particular should benefit from this situation. Furthermore, in 2006, the hotel industry, like all travel and tourism sectors, will face the dual challenge of staff shortages and human resource management. According to a recent US study, 25% of hotel industry employees are dissatisfied with their jobs and 32% of these people would like to find a new job in the next year. The year 2006 is also likely to be challenging for hotel owners in major US cities because many collective agreements are up for renewal.

Transportation

Pressures on the North American airline industry will persist as discount carriers continue to invade the traditional routes of the major airlines. In this competitive environment, ticket prices will remain low, but an expected increase in fuel prices (combined with fewer available seats) should nudge average prices higher among regular carriers. There will also be an increase in the number of pay-per-use in-flight services (pillows, blankets, meals, snacks, etc.).

As for airports, we should see an increase in the services offered to travellers. The addition of shops, restaurants, gyms, beauty salons and professional services are some of the tactics being adopted by airport managers to diversify revenue sources and improve the customer experience.

In 2006, the Airbus A-380 will begin commercial flights. The world?s largest passenger jet, the two-storey airplane will be the first to offer on-board areas for socializing.

In the United States, train travel will grow in 2006. Improved services and schedules, and especially the opportunity to transform travel from a utilitarian role into an experience unto itself, have piqued consumer interest in this service, especially among Generation X travellers.

Technology

Travellers, both business and leisure, are increasingly demanding the opportunity to “plug in” anywhere and any time. Hotels, resorts, convention centres, airports and various types of public transit will intensify their efforts to provide high-speed internet access (for free, if possible!). Sometime in the year 2006, US airlines will begin offering wireless in-flight internet access.

Increased internet use by consumers continues to revolutionize the marketing and distribution of travel products and services. In 2006, the number of online transactions will continue its strong growth. The firm PhoCusWright predicts that by the year 2007, 40% of all travel-related purchases in the United States will take place online.

Furthermore, tourism now constitutes a growing presence on major search engines (Google and Yahoo) and general online shopping sites (Pricegrabber). With more comparison tools now available, the resulting price transparency is forcing suppliers to work even harder on their brands, since the consumer?s perception of value is a combination of price and supplier image.

Tourism marketing should attach greater importance to the internet. It is expected that the concepts of “best price guaranteed”, dynamic packaging and search engine positioning (pay-per-inclusion) will grow in popularity. Experts are also pointing to the growing popularity of internet-related media like blogs and instant messaging. Individuals will have a fast and growing influence on the commercial success of products and services.

Destinations

At this point in the year, China is still the destination that excites the most interest and curiosity. According to guidebook publisher Lonely Planet, this country heads the list of hot destinations, followed by Mali, Brazil, Iceland and Serbia & Montenegro. As for destinations offering exceptional value, the publisher puts Argentina at the top, followed by New Zealand, Morocco, India and Mexico.

In Europe, according to American Express, Great Britain, France and Italy remain the most popular destinations for Americans. However, Eastern Europe continues to attract a lot of interest, particularly the countries on the Adriatic Riviera (Croatia, Slovenia, Montenegro), which are a less expensive alternative.

Sources:
- Armstrong, David. “Travel, Tourism Bouncing Back – Conventions and Visitors Returning, but Room Rates and Airfares Are Going Up,” San Francisco Chronicle, January 8, 2006, p. J1.
- Cruise Lines International Association. “Cruise Industry Trends for 2006,” [Traveldailynews.com], January 16, 2006.
- Grossman, David. “What’s in Store for Business Travelers in 2006?” USA Today, January 9, 2006.
- Harpaz, Beth J. “2006 Hot Spots Include Colorado, China & Croatia,” Associated Press, [CNN.com], December 29, 2005.
- Jones, Steve. “Steady Growth Forecast for Business Travel,” [Travelmole.com], January 3, 2006.
- Meeting Professionals International. “Meetings Industry to Grow in 2006,” [4hoteliers.com], January 11, 2006.
- Randall, Judy. “Top Travel Trends for 2006,” The Charlotte Observer, December 25, 2005.
- Sloan, Gene. “China, the New Croatia?” USA Today, January 5, 2006.
- Westenberg, Kerri. “Travel Trends: Where it’s at in 2006,” [StarTribune.com], January 2, 2006.
- Yesawich, Pepperdine, Brown & Russell. “Ten Trends to Watch in the Year Ahead,” [ehotelier.com], December 30, 2005.
 

Gen Y hybrid consumers will use price transparency provided by the Internet and the euro to combine five-star hotel accommodations with low-cost flights, both reserved at discount travel sites. Although practitioners of conspicuous consumption, the Millennial Group sees no contradiction in following a 5-minute lunch at McDonald’s with a 5-hour dinner chez Ducasse. New concepts of value for money will result in consumers mixing and matching products to satisfy their desire of the moment.

Merger and acquisition activity in the hotel sector will continue at a torrid pace. Starwood’s recent purchases of Meridien and Société du Louvre, the Fairmont-Raffles merger and the reunification of Hilton are precursors of the rapid consolidation ahead.

Multi-brand lodging companies will further capitalize on the reputations of their flagship properties to create upscale product groups using brands such as St. Regis, Waldorf-Astoria and Crillon. These super-luxury properties will justify stratospheric rates by offering enhanced amenities and employing database technology to introduce new standards of service excellence.

As budget airlines emerge in new geographic regions, they will expose the long-ignored fact that air transport is a commodity where low-cost leaders are most profitable. Investors who shied away from traditional carriers will find confidence in these new airlines as manifested by Ryanair’s ranking of maintaining the second highest market capitalization of European airlines (behind Air France-KLM).

While travelers become increasingly accustomed to living in an unsafe world, security will play a significant role in selecting leisure destinations. Disease, crime, air safety and terrorism will become important criteria for holidaymakers planning trips abroad.

While Mr. Chevrier provides a broad optimistic forecast for North America, other destinations will manifest greater variations in demand. In Europe, the United Kingdom, Austria and the Netherlands will see increasing growth in their business and leisure markets while Poland, Germany and Sweden will struggle to fill hotel rooms and tourist facilities. François Chevrier cites the growing attraction of China and India but Asian tourism markets such as Indonesia, Sri Lanka and Nepal will suffer from political instability.

In 2006, analysts, scholars and industry leaders will discover the meaning of Albert Einstein’s observation that “The only constant in the universe is change”.

A thousand and one reasons to cut prices

It is only normal that customers want to get the most for the least amount of money. There are many reasons to cut prices:

• promotions to publicize a new product;
• deals to attract new customers;
• lower prices to beat the competition ;
• special group rates;
• “early-bird” specials;
• last-minute prices to liquidate stock;
• off-season prices;
• guaranteed best rates to lure reservations away from middlemen.

And yet, at the end of the day, such measures cut into the profit margin.

The low-cost concept is in no way synonymous with cheap

Working from the idea that people are looking for low prices, a number of businesses have successfully questioned their traditional ways of doing things and found ways to cut costs and still offer a quality product. In fact, the term low cost (which is often poorly translated into French as “bas prix” or low price) simply means that – since operating costs are lower – one can ultimately offer lower prices. Of course, the calculations are very different for Air Canada from what they are for WestJet when it comes to a $99 Montreal-Toronto flight. Since these two companies do not have the same cost structure, one operates such a flight at a loss, while the other can make a profit. For WestJet, the price is in line with its operating costs, while for Air Canada, it is simply a strategy to boost sales or keep up with the competition.

An increasingly popular business model

The avant-garde, low-cost concept was first adopted by Southwest Airlines in the United States back in 1978. Although it has taken time to catch on, the low-cost concept and the carriers using it are causing a lot of turbulence in the airline industry. WestJet was the first to adopt the concept in Canada and it has been followed by JetsGo, Canjet and Air Canada’s Zip and Tango services.

Even airports are investing in the market. Marseille, Beauvais, Geneva and, most recently, Singapore have all announced plans to open low-cost terminals expressly for these carriers. Could Montréal’s suburban Saint-Hubert Airport be far behind?

To counter stiff competition from low-cost carriers, France’s national rail company (SNCF) has also decided to explore the concept. It has launched a low-cost version of its TGV high-speed rail service, combined with an innovative array of special services. Basically, the rail company is offering exclusive online-booking and “early-bird” rates, considering partnerships to enable customers to design their own products, and is testing a process whereby all tickets are checked upon boarding, rather than on the train.

In France, the Formule 1 hotel chain has revolutionized the economy hotel industry. The concept was developed in the 1980s after a study showed many travellers found hotel rooms too expensive. The entire hotel “production line” was closely scrutinized to reduce capital and operating costs. This type of hotel meets customers’ primary expectations: cleanliness, comfort and low-cost.

Low-cost cruises are now on the horizon. Already the owner of easyJet (a low-cost carrier), easyGroup will soon launch easyCruise. Some are criticizing the idea, saying that easyCruise is more about ocean transport and ferry service than an actual cruise. As opposed to the usual cruise concept based on luxury and attentive service, easyCruise will follow the example of the airlines with a reduced crew, simplified pay-per-use services and, above all, low prices.

Even destinations (Cuba, Tunisia and Turkey) are targeting the low-cost market. At the opposite end of the spectrum, destinations like Monaco, Île Maurice and Deauville wish to maintain their image as playgrounds of the elite.

To each his own, but make sure you are clear

Many successful businesses have proven the merit of the low-cost business model. When a company’s prime objective is to offer a low-priced product, it is important to communicate this clearly and ensure the customer understands what this implies in terms of quality, service and price.

The strength of those who develop new concepts lies in their ability to discern opportunities and take advantage of what the environment offers. Although this is easy enough to say, one must truly have a visionary streak to venture off the beaten path.

Source: Les Cahiers Espaces. “Stratégies de petits prix,” Vol. 79, November 2003.