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ICAO Decision On Aviation Carbon Market Rules A Step In The Right Direction

ICAO decision on aviation carbon market rules a step in the right direction but fails to exclude all junk credits

MONTREAL/BRUSSELS, 14 March 2020. The UN aviation body ICAO’s Council has agreed to recognise carbon offsets from six existing offset programmes for use by airlines under CORSIA, the UN’s new carbon market for aviation. The Council's 36 member countries also decided to limit the age of credits used as well as the type of projects eligible. However, the total supply of available credits is still several times larger than demand over the scheme’s pilot phase and airlines will be able to buy credits from low-quality projects.

The decision is based on an expert report from the so-called “Technical Advisory Body" (TAB).

Out of the 14 organisations that had applied to be eligible under CORSIA, the following six were recognised as such: the Clean Development Mechanism, the China GHG voluntary Emission Reduction Programme, the Voluntary Carbon Standard, the Gold Standard, the Climate Action Reserve, and the American Carbon Registry. The Forest Carbon Partnership Facility and the Global Carbon Council are also recognised with conditional eligibility, pending some further changes to their procedures.

The Council also adopted a restriction on the age of offsets which can be used by airlines (so-called “vintage restriction”). Only credits from projects whose first crediting period started on 1st of January 2016 and which represent emission reductions achieved on or before December 31st, 2020 can be used.

The vintage restriction could reduce the potential supply of credits, with estimates ranging between 180-570 million credits, down from several billion which could have been eligible if no restrictions had been adopted. However, the total supply will still be several times larger than demand over the scheme’s pilot phase. The demand is estimated to be between 44-158 million credits, depending on the scenario used, and the impact of the coronavirus outbreak on aviation emissions in 2020.*

Gilles Dufrasne, policy officer at Carbon Market Watch said:

This is a mere “damage control” agreement which falls short of the level of ambition needed. The adopted restrictions are better than nothing, but the climate crisis leaves no space for second-best options. The door is still open for airlines to use junk credits to offset their pollution, while CORSIA's overall objective of “carbon-neutral growth” is a sneer in the face of the climate breakdown.

The TAB report highlights the lack of additionality of several programmes and the risks related to the non-permanence of emission reductions and excludes all projects which have not formally reported on their sustainable development benefits. While imperfect, the decision to adopt the report thus sets an important precedent to inform the difficult parallel negotiations under Article 6 - which lays the foundation for global carbon markets - of the Paris Agreement.

Gilles Dufrasne:

“It shows that countries understand that we shouldn’t accept just anything and everything on the future carbon markets. It highlights the importance of sustainable development and also once again sends a clear warning against using credits from planting trees to offset pollution.”

A significant portion of emission reductions used under CORSIA could still come from low-quality projects, such as those under the Clean Development Mechanism (CDM), most of which do not reduce emissions globally and in some cases are linked to human rights violations.

Gilles Dufrasne:

The aviation carbon market will provide the UN’s offsetting scheme life support for another few years, but it is clear that the CDM has lost all credibility and anyone who cares about supporting high-quality climate projects, should steer away from it.

Programmes can now apply again for consideration under CORSIA, and the restrictions adopted will be reviewed before the start of the first phase in 2024.
 

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