As part of its strategy to achieve carbon neutrality, the International Civil Aviation Organization (ICAO) adopted in 2016 the Carbon Offsetting and Reduction Scheme for International Aviation, known as CORSIA.
CORSIA is the first global compliance scheme adopted by a specific sector. Covering international aviation only (domestic flights are excluded), it requires, since 2019, airlines to report their annual GHG emissions each year. The air industry sector committed to reaching net zero emissions by 2050, and to reach this ambitious goal the implementation of CORSIA started in 2021.
The implementation of CORSIA will be done in three phases:
- Pilot phase (2021-2023)
- First phase (2024-2026)
- Second phase (2027-2035), where participation will be mandatory.
From January 2023, 115 countries are participating in CORSIA, and more have announced their intention to join in 2024.
In addition to CORSIA’s three-phase plan, the aviation sector is also making simultaneous efforts to reduce greenhouse gas emissions through the implementation of new technologies designed to enhance the utilization of more efficient and sustainable fuels.
CORSIA will significantly drive the demand for carbon credits as it is known that aviation is a sector hard to abate. Therefore, airlines will need to buy carbon credits from CORSIA approved standards to meet their targets. This is a good example of how independent crediting mechanisms operating under the VCM can be a source of supply for a compliance market.