CORSIA (Carbon Offsetting and Reduction Scheme for International Aviation) is the global market-based initiative aimed at reducing emissions from international aviation. It offers a unified approach, moving away from fragmented national or regional regulations, thereby minimizing market distortions and respecting the varying capabilities of International Civil Aviation Organization (ICAO) Member States. Under CORSIA, airlines are required to purchase carbon credits to offset CO2 emissions that cannot be mitigated through technological advancements, operational improvements, or sustainable aviation fuels.
In this blog, we explore the current status of CORSIA, offsetting requirements, and how airlines can prepare for compliance.
CORSIA is the Carbon Offsetting and Reduction Scheme for International Aviation. Established by International Civil Aviation Organization (ICAO) in 2016, CORSIA aims to help reduce and offset international civil aviation emissions starting from 2021. Airlines achieve this by purchasing carbon credits, known as Eligible Emissions Units (EEUs).
CORSIA is being implemented in three phases:
ICAO member states can voluntarily participate in CORSIA for the Pilot Phase and Phase 1, and emissions from flights between airports in participating states are regulated. Participation among ICAO member states is mandatory from Phase 2, with a few exceptions. As of January 2024, 124 ICAO member states have voluntarily opted into Phase 1.
During the Pilot Phase and Phase 1, airline offsetting obligations are determined by the Sectoral Growth Factor (SGF), reflecting the emissions growth of international aviation beyond a predetermined baseline.
For the Pilot Phase and Phase 1 (2024-2026) airline obligations are calculated by:
During the Pilot Phase (2021-2023), the baseline was the level of sectoral emissions in 2019. Due to reduced travel during the COVID-19 pandemic, emissions were below the baseline, resulting in zero offsetting requirements during this period.
However, the SGF will be positive during Phase 1 (2024-2026). With recovery in international travel, airlines now have positive offsetting obligations. ICAO forecasts a demand of approximately 100–150 million carbon credits for Phase 1.
Example calculation
For an airline emitting 100,000 tonnes of CORSIA-covered emissions in 2024 and an SGF of 10%, their offsetting requirement would be:
For Phase 1, airlines must retire the necessary credits by January 2028.
ICAO determines the carbon standards allowed to issue Eligible Emissions Units (EEUs) that airlines can use to meet their offsetting obligations. ICAO also determines eligibility requirements for each standard, such as vintages, project types, and methodologies.
During Phase 1, EEUs require corresponding adjustments to ensure no double counting occurs—meaning the project host country cannot also claim these emission reductions.
The following carbon standards are approved to provide Phase 1 EEUs:
However, restrictions and exclusions apply. See ICAO’s List of Eligible Emission Units for more details.
The following other standards have been only conditionally approved, meaning program updates are needed before they receive full approval:
Airlines can reduce their obligations by using Sustainable Aviation Fuel (SAF) and lower carbon emission fuels (LCAF), collectively known as CORSIA Eligible Fuels (CEF). ICAO specifies approved feedstocks, production methods and with eligibility criteria encompassing environmental and socio-economic aspects.
Airlines have two methods to calculate emission reductions from CEF use:
Currently, there are limited CORSIA-eligible credits available as few countries have established processes for applying corresponding adjustments to carbon projects. However, after successful negotiations on Article 6 of the Paris Agreement at COP29, the supply of EEUs will expand significantly in 2025. As supply grows, organizations outside the aviation sector may also seek CORSIA-eligible credits, which are expected to trade at a premium.
EcoAct’s Carbon Market specialists can guide you through the complexities of the voluntary carbon market, including CORSIA rules, Article 6 negotiations, and the evolution of influential frameworks such as the Integrity Council for the Voluntary Carbon Market (ICVCM).
We help build robust carbon credit portfolios based on regulatory and voluntary offsetting requirements, budget constraints, and project preferences. Additionally, we can assess the financial case for engaging in different spot market procurement models or developing carbon projects of your own.
Get in touch with EcoAct experts to navigate the complexities of CORSIA and ensure your airline is prepared for current and future compliance requirements.
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