Five Californian supermarkets – part of the Grocery Outlet and Raley’s brands – have raised finances from the sale of refrigerant carbon credits after choosing to install natural refrigerant-based refrigeration systems, such as a transcritical CO2 (R744) booster system, instead of traditional HFC-based alternatives.
According to a statement from Therm, a U.S.-based company specializing in creating and trading refrigerant carbon credits, this money has enabled the supermarkets to “implement climate-friendly [refrigeration] systems at a competitive cost.”
The development and sale of these carbon credits was led by Therm as part of a pilot program of the North American Sustainable Refrigeration Council (NASRC). The credits were issued by the American Carbon Registry and purchased and retired by Climate Impact Partners on behalf of an established market participant.
In addition to the CO2 booster system, other projects that participated in NASRC’s carbon credits pilot program included a micro-distributed system and stand-alone cases, all using either R744 or propane (R290).
Typically, the high capital cost associated with natural refrigerant-based systems has been a significant barrier to entry for retailers looking to upgrade their refrigeration systems to a more sustainable option, explained Therm.
“We are seeing more and more grocers who are interested in switching to climate-friendly refrigerants but can’t find the capital,” said Danielle Wright, Executive Director of the NASRC.
However, according to Therm, refrigerant carbon credits can offer a type of rebate for stores.
The number of credits created by a system upgrade is based on the environmental impact of the climate-friendly systems compared to their traditional alternatives, said Therm. Retailers can then sell these carbon credits to help offset some of the capital costs of their project.
“This creative structure opens the door for even the smallest stores to finance their refrigerant upgrades,” added Wright.
“Climate-friendly refrigerants are the number one way that we can prevent further climate damage,” said Fritz Troller, CEO and Co-Founder of Therm. “The increasing price of carbon credits and the undisputed permanence of [refrigerant carbon credits] put them at a market premium and help our retail grocer customers and food distributors by providing meaningful financial incentives.”
Alternatively, instead of selling their carbon credits, system owners can choose to retire the credits against their own climate goals or hold them as a longer-term financial investment.