The aviation industry took a significant step forward towards its decarbonization goals with the recent announcement from the International Air Transport Association (IATA). At the World Sustainability Symposium (WSS), IATA revealed a dedicated procurement event for airlines to purchase Eligible Emissions Units (EEUs), essential for meeting their Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) obligations. This event, scheduled for the last quarter of 2024, will be hosted on the Aviation Carbon Exchange (ACE) and is set to bolster airlines’ access to critical carbon credits.
The move comes at a pivotal time, with the State of Guyana, Mercuria, and Xpansiv partnering to make EEUs available for airlines under CORSIA Phase 1. As airlines grapple with meeting their offset requirements for the 2024-2026 traffic period, the scarcity of eligible EEUs has been a notable challenge. The upcoming event not only addresses this gap but also opens new opportunities for fostering market liquidity, pricing transparency, and stimulating global participation in the aviation sector’s decarbonization efforts.
A Groundbreaking Event for CORSIA Compliance
CORSIA remains the only globally recognized market-based initiative aimed at mitigating CO2 emissions from international aviation. By offering airlines a mechanism to offset their emissions through EEUs, the scheme enables the industry to curb its environmental impact while maintaining operational growth. However, the limited availability of EEUs has raised concerns. With an estimated need of 64 to 162 million EEUs for Phase 1 compliance, IATA’s initiative comes as a timely intervention.
“The procurement event will serve as a clarion call, showcasing the urgency for states to release requisite EEUs, ensuring airlines can comply with CORSIA’s stringent requirements,” remarked Marie Owens Thomsen, IATA’s Senior Vice President Sustainability and Chief Economist. Guyana, the only current source of such EEUs, has already issued 7 million units, with uncommitted volumes being made available at the event.
Guyana Leading the Way in Carbon Credits
Guyana’s role in this event is a testament to its leadership in global emissions reduction. The Guyana Jurisdictional REDD Program, which has issued CORSIA-compliant EEUs under the ART TREES Standard, underscores the country’s proactive approach in supporting international climate commitments. With other nations yet to finalize their own emissions credit programs, this event aims to inspire confidence in the broader global market, demonstrating that investing in emissions reduction programs is both viable and profitable.
“This event is about building market confidence. By acting as the first mover, Guyana is proving that credible carbon credit markets can thrive, encouraging other nations to follow suit,” said Pradeepa Bholanath, Senior Director of Climate Change at Guyana’s Ministry of Natural Resources.
VURDHAAN’s Role in Aviation Sustainability
At VURDHAAN, we understand the complexities of navigating aviation’s evolving regulatory landscape, particularly in relation to CORSIA and carbon offsetting initiatives. As active participants in the sector, we are well-positioned to support airlines in their sustainability journeys—whether through compliance assistance, emissions reporting, or optimizing carbon credit procurement strategies. Our expertise extends to guiding organizations through systems like CORSIA, EU ETS, and UK ETS, ensuring they not only meet mandatory obligations but exceed them.
Through our holistic approach—Support, Educate, and Implement—we help airlines unlock new opportunities for reducing their carbon footprint. We provide tailored solutions that align with regulatory requirements and sustainability goals, from sourcing Sustainable Aviation Fuels (SAF) to understanding non-CO2 effects on climate change. Our support in these critical areas helps organizations remain compliant, while driving innovation and positive change across the aviation industry.
A Sustainable Future for Aviation
The IATA EEU Procurement Event is more than a purchasing opportunity; it’s a pivotal moment for the aviation industry’s journey toward sustainability. By encouraging market participation, transparency, and early action, the event helps ensure that airlines can meet their emissions goals without facing exorbitant costs or compliance delays.
As we look ahead to 2024 and beyond, VURDHAAN stands ready to partner with airlines and other stakeholders in seizing the opportunities that this event and others like it present. Together, we can build a future where aviation continues to soar while reducing its environmental impact, benefiting both the industry and the planet.