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JBG Smith: Pioneering Sustainability in Placemaking

JBG Smith - National Landing - Metropolitan Park - credit David Madison

JBG Smith is a leading real estate investment trust (REIT) with a strong focus on sustainability and environmental, social, and governance (ESG) initiatives. The company specializes in managing, developing, and transacting urban infill, metro-served assets backed by third-party building certifications. The company's ESG strategy is systematically integrated across the organization, with the Sustainability Team, ESG Committee, and Operating Committee working together to ensure continuous improvement and tactical deployment of ESG initiatives. The company's senior leadership, including Kim Pexton, and Matt Kelly, and its Board, is committed to achieving a 100% renewable electricity target and addressing any risks associated with sourcing renewable energy.

Matt Kelly, CEO - JBG Smith

In 2022, JBG Smith achieved significant milestones in its sustainability journey, including reducing its carbon emissions to 83,046 MtCO2e and consuming 321,813 MWh of energy. “Achieving carbon neutrality across our operating portfolio provides JBG SMITH with a strong and compelling competitive advantage. Our office, residential, and retail customers increasingly demand this from their real estate space and service partners and our investors expect that we are doing all that we can to address this looming and critical threat,” said CEO, Matt Kelly. “Our collective actions over the next decade are essential in offsetting the current carbon emission trajectory and, through sustainable best practices, JBG SMITH remains committed to positively impacting the communities we serve at every level.”

To establish carbon neutral operations, JBG SMITH purchased verified carbon offsets for scope one carbon emissions and 244K MWh of renewable energy credits (RECs) for scope 2 electrical consumption. JBG SMITH’s planned next step toward long-term sustainability includes the development of an offsite renewable energy strategy, which is expected to replace a significant portion of annual REC purchases and bring additional renewables to the national electrical grid. To maintain their carbon neutrality, JBG SMITH plans to:

  1. Drive down energy consumption across its existing portfolio

  2. Reduce anticipated energy consumption and embodied carbon for its development pipeline

  3. Deploy onsite solar where most impactful

  4. Explore offsite solar opportunities and bring additional renewables to the national electrical grid

  5. Address the remainder of carbon emissions with verified carbon offsets and renewable energy credits (RECs)

Kim Pexton, SVP of Sustainability - JBG Smith

“The implementation of decarbonization strategies that address real, permanent business change and future innovation is critical to maintaining a carbon neutral portfolio,” said Kim Pexton, Vice President of Sustainability at JBG SMITH. “We view the purchase of RECs and verified carbon offsets for scope one and two as an immediate action we can take as we develop and implement a more robust strategy to ensure compatibility with a net zero economy.”

The Impact of RECs with Additionality

JBG Smith's progress in renewable energy procurement could be further enhanced by incorporating Renewable Energy Certificates (RECs) with additionality into its strategy. RECs with additionality can provide several benefits, including:

  1. Accelerating the transition to renewable energy on the grid.

  2. Mitigating costs associated with continued renewable energy procurement using RECs without additionality.

  3. Strengthening the company's marketing claims for sustainability purposes.

  4. Scaling emission reduction strategies to cover increased electricity consumption as the business grows.

In conclusion, JBG Smith has demonstrated a strong commitment to sustainability and renewable energy procurement. By incorporating RECs with additionality into its strategy, the company can further enhance its positive impact on the environment and solidify its position as a leader in sustainable real estate development.


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