The International Air Transport Association (IATA) has called on governments worldwide to urgently address the extremely limited supply of carbon credits available for airlines to fulfill their obligations under the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA).
CORSIA, a programme under the International Civil Aviation Organization (ICAO), is designed to cap carbon dioxide emissions from international flights at 2020 levels by requiring airlines to offset any increase in emissions beyond that baseline.
Specifically, the signatories call on governments to issue Letters of Authorization (LoAs), which enable the release of CORSIA Eligible Emissions Units (EEUs) for purchase by airlines.
According to IATA, the timely issuance of LoAs is key to creating a robust and transparent market for CORSIA EEUs.
“CORSIA is a vital part of aviation’s global climate strategy. Through it, airlines mitigate their climate impact by funding verified emissions reductions in other sectors. In generating this climate finance, CORSIA also plays a key role in both environmental and socio-economic progress, especially in developing countries. To unlock CORSIA’s climate finance potential and ensure its contribution to aviation’s decarbonization, states must authorize the release of EEUs. That is one of our top messages to the 193 member states at the ICAO Assembly,” said Yue Huang, Assistant Director Climate Policy, in an ICAO Skytalks session at the 42nd ICAO Assembly, in Montreal, Canada.
'Unlocking access to CORSIA-eligible units and attracting climate finance. This will enable Africa to show commitment to sustainability and shape global solutions with regional perspectives. This is about ensuring that our economies and operators benefit fairly from the transition to a low-carbon future,” said Adefunke Adeyemi, Secretary-General of the African Civil Aviation Commission (AFCAC) at the same event.
What are Letters of Authorization (LoAs)?
LoAs are official documents issued by host countries authorizing the use of carbon credits (known as Internationally Transferred Mitigation Outcomes or ITMOs) for CORSIA compliance, according to the provisions of Article 6 of the Paris Agreement. The letters confirm that the emissions reductions associated with a carbon credit will only be counted once, as part of CORSIA, by requiring the host country to apply a 'corresponding adjustment' to its own Nationally Determined Contribution (NDC). Without LoAs, airlines face a shortage of CORSIA-eligible units, placing CORSIA in jeopardy, and depriving project developers of airline funds as a source of climate finance.
The Demand-Supply Gap
IATA forecasts that airlines will require between 146 and 236 million EEUs during CORSIA’s first phase (2024–2026). However, the current supply of CORSIA-eligible units is limited to the 15.8 million credits made available by Guyana.
The Civil Aviation Authority (CAA) of Oman issued a national regulation this year to implement the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) programme.
Under the CORSIA programme, national airlines operating in Oman will be required to:• Purchase carbon offset units in accordance with ICAO standards.• Monitor and report CO₂ emissions from international aviation activities, ensuring alignment with global emissions reduction efforts.