Towards carbon neutral growth

Aviation has been among the fastest growing sectors globally, both in terms of economic output and emissions. A plan for carbon-neutral growth from 2020 adopted by ICAO in 2016 – known as CORSIA – is confronting the industry and governments with unprecedented challenges.

CORSIA – An ambitious plan is taking shape

Aviation currently accounts for some 2% of global CO2 emissions, with a strong increase projected for the coming decades. Domestic aviation has been subject to emissions caps in Europe for some five years now. In addition, IATA, the industry’s leading association, announced in 2009 a set of three sequential goals for air transport: (1) a 1.5 % average annual improvement of fuel efficiency from 2009 to 2020, (2) carbon neutral growth from 2020 onwards and (3) a 50% absolute reduction in carbon emissions by 2050.

To further these initiatives, the International Civil Aviation Organization adopted in October 2016 global market based measure to help achieve carbon neutral growth, known as the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA).

CORSIA provides a framework for offsetting emissions from flights between participating countries above the 2020 baseline. In its first phase from 2021–2026, participation in the scheme will be voluntary, but the most important countries have already indicated their intention to engage. From 2027 onwards, participation will be mandatory for most countries.

First Climate: Working with airlines

CORSIA is confronting airliners with a serious of demanding questions including:

  • Which operations will be affected?
  • What are the requirements for monitoring, reporting and verification?
  • Which carbon offsets will be eligible instruments for achieving compliance?
  • What is the best strategy for ensuring compliance efficiently?

First Climate has been working with leading airlines for the reduction their carbon footprint for over a decade. In response to CORSIA, First Climate is co-sponsoring a series of workshops co-hosted by IATA and IETA in Geneva, Miami and Singapore in February and March 2017.

>>Details on the workshops and registration are available here.

Ambitious targets for the aviation industry

The International Air Transport Association (IATA), the industry’s main corporate lobby group, announced in 2009 a set of three sequential goals for air transport: (1) a 1.5 % average annual improvement of fuel efficiency from 2009 to 2020, (2) carbon neutral growth from 2020 onwards and (3) a 50% absolute reduction in carbon emissions by 2050.

Together with ICAO they also adopted a basket of measures. However technological and operational improvements alone are not enough to meet the carbon neutral growth goal. Alternative sustainable fuels require further development and maturity to make a significant contribution to reducing CO2 emissions. To fill the emissions gap the 39th ICAO Assembly agreed on a global market based measure to help to achieve carbon neutral growth. The agreed scheme is referred to as CORSIA, which stands for Carbon Offsetting and Reduction Scheme for International Aviation.

Figure 1: CO2 emissions trends from international aviation from 2010 to 2020. Technological and operational improvements alone are not enough to meet the carbon neutral growth goal. Baseline scenario includes fleet renewal.

Source: Based on ICAO Environmental Report 2016.

CORSIA: How it will work

Offsetting is the process through which a company or organization compensates for its carbon emissions by buying credits from the carbon credits. These credits are generated by projects that reduce carbon emissions in different parts of the world, for example by planting trees that absorb carbon or replacing fossil fuels with renewable energy sources such as wind and solar. Taking into account the different circumstances of different countries CORSIA was designed to incorporate a phased-in implementation.

States participation in the pilot and the first phase from 2021 to 2026 is voluntary. As of about October 2016, 66 states that represent 86.5% of global international aviation activities announced their voluntary participation in the CORSIA from its outset. In the second phase from 2027, all states with an individual share of international aviation activities above 0.5% of the total, or whose cumulative reaches 90% of the total are required to participate. Least developed countries, small island developing States, and landlocked developing countries are exempted from participation unless they volunteer to decide to do so.

CORSIA is based on a route based approach. This means that only emissions from international flights between two states where both the origin and the destination states are included in CORSIA are part of the scheme. Once we know the participation of the states and the coverage of air routes between participation states under CORSIA, ICAO calculates the offset requirements for individual aircraft operators every year. Each operator monitors its annual fuel consumption from all its flights on the routes covered by CORSIA and estimates its annual CO2 emissions. Each operator reports this data to the national authority of the state. ICAO collects all CO2 emissions data estimates a sectorial growth factor of emissions. Using the sectorial growth factor of emissions every year, each operator calculates the amount of CO2 offsetting requirements by multiplying its emissions with the sectorial growth factor.

The operator then purchases a number of emission units equivalent to this requirement from the carbon market. Each admissions unit corresponds to one tonne of CO2 that was reduced by another project or programme. To ensure that operator states and ICAO are able to implement the scheme starting in 2021, ICAO is currently developing rules and procedures for monitoring reporting and verification system, criteria for emissions units to be purchased by aircraft operators and registries.

These rules and procedures will safeguard environmental integrity of the scheme by ensuring that the offsets are of high quality and come from reliable sources. ICAO, in partnerships with the governments and international organizations, will assist all states to put in place the necessary infrastructure to ensure that they are ready to implement CORSIA. Starting in 2022 the scheme will be reviewed every three years.