Aviation offset rules face shake-up as doubts persist

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• Voluntary scheme seen as weak
• Offset prices have plunged
• But emissions are surging

An imminent change to rules governing aviation carbon offsets ahead of the Cop28 climate conference may not be enough to convince airlines and others they have a meaningful effect, it has emerged.

Aviation, like steel- and cement-making, is a hard-to-abate industry. It is difficult for companies within the sector to reduce emissions of carbon dioxide (CO2) significantly and still operate as they did before.   

Corsia (Carbon Offsetting and Reduction Scheme for International Aviation) is a voluntary scheme to which 125 nations have become signatories. Under its terms, only emissions exceeding 85 percent of a 2019 baseline must be offset from 2024.

Offsets can take various forms such as reforestation schemes, renewable energy projects and programmes to provide cleaner cooking fuels in developing countries.

The International Civil Aviation Organization (ICAO) is likely to publish new Corsia guidelines – dubbed Corsia 1.0 – before Cop28 and possibly as soon as this month.

“We don’t know just how much more stringent or how detailed the new regulations will be,” Yvonne Lam, head of carbon & CCUS research at Rystad Energy in Oslo.

“That’s why a lot of airlines have halted buying any more Corsia credits until we get some clarity on the new rules.”

Corsia emerged from the aviation industry’s reluctance to respond to European Union demands to tackle emissions as part of the 1997 Kyoto Protocol, according to Roman Mauroschat, aviation policy officer at non-profit Transport & Environment.

The EU added aviation to its emission trading scheme (ETS) in 2012, leading to Corsia’s launch in 2016, although the latter’s “functioning is different and its level of ambition is fundamentally lower than the ETS”, said Mauroschat.

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Corsia is “very weak” compared with the EU ETS, which itself is inadequate, said Thomas Gelin, Greenpeace’s political campaigner for transport.

As a body run by the aviation industry, ICAO, which declined to comment to AGBI, has no incentive “to take unpopular measures or do what is objectively needed” to limit global warming to 1.5C temperature rise limit, said Gelin.

Surging fuel use

Airlines’ carbon dioxide emissions are closely correlated to their fuel consumption despite efficiency improvements. For example, Emirates’ aircraft consumed 8.46 million tonnes of jet fuel in its financial year 2022-23, which ended on March 31, up 46.0 percent year on year.

The aircrafts’ scope 1 CO2 emissions – those arising directly from activities – also rose 46 percent over the same period to 26.7 million tonnes.

In an emailed response, an Emirates spokesperson said the company had yet to buy any carbon offsets, “either for regulatory or voluntary purposes”, noting it had yet to exceed the Corsia emissions baseline.

Emirates aircraft’s jet fuel consumption in 2019-20 was 10.9 million tonnes, while its CO2 emissions were 34.4 million tonnes.

Unsplash/Aristedes Carrera

Airlines, meanwhile, are making a subtle shift to place the responsibility on individuals, rather than on the companies, to reduce their emissions. Many carriers including Abu Dhabi’s Etihad Airways allow passengers to pay extra for an offset.

Greenpeace’s Gelin described carbon offsets for aviation as an illusion.

“There’s a certain fiction behind it because the only reduction in emissions that matter is the one at the source – for example, flying less to emit less CO2,” said Gelin.

Another problem with carbon offsets is the uncertainty over whether a project that purportedly eliminates carbon emissions would have occurred anyway. If so, then such a scheme is not really offsetting.

“It’s a very opaque system and it’s designed to be so, because the idea is to appeal to the green conscience of many people and let them fly with a clear conscience,” said Gelin.

Plunging prices

The price of carbon credits – those endorsed by Corsia and other bodies – has plunged since early 2022 as confidence in the projects underlying them dwindled. An EU study, for example, found 85 percent of carbon offset projects did not achieve additional emission reductions.

Buying carbon credits is also only the first step. For them to count as an offset, companies must “retire”, or destroy them so that they cannot be reused or resold.

“There has been so much criticism about offsets, their methodologies and the way companies are using them,” said Lam. “The criteria can be very ambiguous, while there’s little transparency on when companies are retiring the credits they’ve bought, as currently there’s no obligation to report this.”

The largely voluntary nature of Corsia remains a fundamental limitation to its implementation – without a necessity to purchase and retire such carbon credits until airlines exceed their baselines, they will ultimately prioritise profit over buying offsets.

Massive oversupply is another flaw that has weighed on offset prices. According to an EU study, Corsia-registered projects could provide about 1.5 billion credits despite demand for just 493 million.

“More and more voices are asserting that offsets are inefficient,” added Mauroschat. “Even leaders in the aviation world are calling against offsetting.”