By Chris Lang
Before the coronavirus crisis, greenhouse gas emissions from the aviation industry were among the fastest growing of any industry. Yet there is no mention of the aviation sector in the Paris Agreement. Instead, in 2016, the UN International Civil Aviation Organisation (ICAO) announced that aviation would go “carbon neutral” from 2020.
The aviation industry plans to continue expanding, and continue polluting, while relying heavily on offsets to achieve the illusion of “carbon neutral” growth.
The industry’s proposed Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) never had any credibility. It was always a distraction from the urgent need to reduce emissions dramatically.
At the ICAO Council meeting that runs from 8 to 26 June 2020 in Montreal, governments are busy watering down CORSIA even further. Under CORSIA rules, the aviation industry was supposed to offset any increase in emissions from 2020 compared to a baseline set as the average of 2019 and 2020 emissions.
Because of the coronavirus crisis, aviation emissions have fallen this year. According to the International Air Transport Association (IATA) aviation emissions this year could fall to 1995 levels. The baseline would be much lower than anticipated, and the aviation sector would have to buy a lot more offsets.
So, IATA has been lobbying the ICAO Council, arguing that the baseline “must be adjusted to ensure the sustainable development of international aviation and avoid an inappropriate economic burden on the sector”.
IATA argues that changing the baseline to 2019, and ignoring the drop in aviation emissions in 2020, would save airlines US$15 billion. But IATA doesn’t say what price for carbon offsets it used to come up with this figure.
USA, EU, and Latin America fall into line
On 8 June 2020, Reuters reported that the United States and the Latin Americal Civil Aviation Commission support changing the baseline:
The United States told a virtual ICAO meeting on Friday it supports changing CORSIA’s baseline, three sources said.
The Latin American Civil Aviation Commission, which represents countries in the region, said in a letter to ICAO’s council president seen by Reuters that it supports changing the baseline.
The European Union has also confirmed that it will back IATA’s proposal to change the baseline. According to Climate Home News, France, Germany, Italy, the UK, Finland, the Netherlands, Spain, and Greece will speak in favour of watering down CORSIA’s rules at ICAO’s Council meeting. Sweden is the only EU country to oppose changing the baseline.
Gilles Dufrasne at Carbon Market Watch told Climate Home News that,
“This could be the final blow for Corsia. It was always a ridiculously weak system, but now it is becoming essentially meaningless. Airlines are just let off the hook one more time.”
Aviation’s free pass on climate
A recent report by the Öko-Institut looks at the implications of changing the baseline and concludes that,
The proposal by IATA to use a 2019 baseline would delay mitigation obligations for the industry by several years and most likely waive any offsetting requirements in the pilot phase, and possibly even in the first phase of the scheme.
Using only a 2019 baseline, the Öko-Institut writes, would “remove incentives for the industry to achieve a green recovery and to take the necessary steps and investments to embark on the transition towards zero emissions that is ultimately needed to achieve the goals of the Paris Agreement”.
Since 1970, the aviation industry has faced five crises. Each crisis resulted in a slow down in aviation’s growth, but the recovery took six years at the longest (that was after the Gulf War in 1990-1991). Öko-Institut’s graph shows the recovery period in each case – and clearly illustrates how the continued growth of the aviation industry is an urgent problem to address if we are to stand a chance of addressing the climate crisis:
The International Council on Clean Transportation calculates that total CO2 emissions from commercial aviation operations (including domestic flights – which are excluded from CORSIA, passenger movement, and freight) totalled 918 million tons in 2018. That’s a 32% increase over five years, and 70% higher than ICAO’s projections.
Offset supply and demand
Obviously, cheap offsets are in the aviation industry’s interest. The industry is doing everything it can to reduce the price of offsets – increasing supply by including more and more offsetting programmes in CORSIA, and reducing demand by changing the baseline. There is currently a massive oversupply of carbon credits. And that’s unlikely to change any time soon.
In March 2020, ICAO included the Clean Development Mechanism as one of six offsetting programmes that are eligible for CORSIA. On 10 June 2020, CER Futures were changing hands on the European Energy Exchange for €0.24.
ICAO’s Technical Advisory Body is currently considering a further eight programmes, and reconsidering two that were previously submitted (including the World Bank’s Forest Carbon Partnership Facility). Accepting more programmes into CORSIA will increase the supply of carbon credits even further.
According to the theory of supply and demand, if the supply of an item is larger than the demand, the price will fall. The aviation industry is simultaneously increasing the supply of offsets while reducing demand to as close to zero as it can get away with. Guess what happens next.