International Civil Aviation Organisation (ICAO)

Governments are working toward a new international agreement in October 2016 to limit greenhouse gas emissions from aviation.  Airline emissions account for 2 percent of global greenhouse gas emissions and, without stronger measures, could triple by 2050.

In 2010, the International Civil Aviation Organisation (ICAO), the United Nations body that governs civil aviation, set a goal of carbon-neutral growth starting in 2020.  At the 39th ICAO Assembly in October 2016, member states agreed two policies to meet the carbon-neutral goal: international CO2 standards for aircraft; and a market-based mechanism to offset aviation emissions with reductions in other sectors.   

Meeting the carbon-neutral goal will require efficiency improvements to reduce fuel use, new alternative fuels, operation improvements, and infrastructure upgrades.

CO2 Standards for Aircraft

In February 2016, the ICAO Committee on Aviation Environmental Protection (CAEP) gave preliminary approval to a CO2 standard for new aircraft, which was formally adopted at the 2016 ICAO Assembly.  The standard effectively mandates that each new generation of aircraft continue to achieve the 15-20 percent fuel efficiency gains seen in recent generations.

The standard will apply in three stages. From 2020, all new aircraft designs would have to comply with the new standards.  From 2023 to 2028, all aircraft models currently being produced will have to meet a less stringent “in-production” standard if they undergo modifications requiring re-certification. From 2028, all new aircraft will have to meet the full standards. 

Virtually all aircraft types in the global commercial fleet will be covered by the CO2 standard, which applies a complex formula based on fuel use during the “cruise” portion of a flight, adjusted for fuselage size.

A Market-Based Mechanism

Governments worked with the airline industry to design a market-based mechanism enabling airlines to offset increased emissions with reductions in other sectors.  With air travel projected to continue rising rapidly, airlines are expected to rely heavily on offsets to achieve carbon-neutral growth.  The World Bank estimates demand for offsets to reach 250 MtCO2e by 2030 and a cumulative 13-20 GtCO2e by 2050.

The Market-Based Measure is known as the Carbon Offset and Reduction System for International Aviation (CORSIA). These are the main features of the CORSIA:

  • The CORSIA would commence with a pilot phase from 2021 to 2023, a first phase from 2024 through 2026, and a second phase from 2027 through 2035. In the pilot and first phases, participation will be voluntary. More than 60 countries have agreed to join the program during the voluntary phase, including the U.S., China, European states, Mexico and others. In the second phase, all states not exempted (see below) will be required to participate.

  • Exemptions from the second phase apply to least developed countries (LDCs), small island developing states (SIDS), landlocked developing countries (LLDCs) and those with a share of international aviation below 0.5 percent in 2018. This is calculated on the basis of Revenue-Tonne-Kilometers (RTK), a measure of revenue generated moving a metric tonne by one kilometer.
  • Offset requirements during the pilot phase can be calculated either on the basis of an operator’s emissions during the given year (e.g. 2021-level emissions in 2021), or they could refer back to 2020 emissions throughout the pilot phase. It is up to each participating state to choose between these approaches.
  • ·      In the pilot phase, first phase, and the first two years of the second phase (i.e. from 2021 to 2029) the distribution of offsetting requirements would be completely on the basis of the growth rate of the sector overall, rather than each individual airline’s growth rate. This ratio would change over time, however, so that in 2030 to 2032, 20 percent would be on the basis of individual airline’s growth rate, and the rest on the basis of the sector. This grows to 70 percent individual rate applied from 2032 to 2035.

Some issues will require further negotiation. A centralized registry under the auspices of ICAO will be designed by 2018, to take effect once the CORSIA begins. In addition, a monitoring, reporting and verification (MRV) system and the Emissions Unit Criteria (EUC), which determines what offsets are eligible to be used for compliance, will be decided by 2018.