In a significant development for the aviation industry’s sustainability efforts, the International Air Transport Association (IATA) has announced a special event for airlines to purchase carbon offset units, known as Eligible Emissions Units (EEUs). This event, set for the final quarter of 2024, will be hosted on the Aviation Carbon Exchange (ACE) and is crucial for airlines seeking to meet their Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) obligations.
The procurement event, organized by IATA in partnership with the State of Guyana, Mercuria, and Xpansiv, is open to all airlines. The EEUs offered at this event will help airlines comply with their CORSIA Phase 1 offsetting requirements, covering the period from 2024 to 2026. To comply, the EEUs must be canceled by January 31, 2028.
This initiative is particularly important due to the ongoing shortage of CORSIA-eligible EEUs. Currently, Guyana stands as the sole provider of these units, making this event a vital opportunity for airlines to secure the necessary offsets. IATA estimates that airlines may require between 64 to 162 million EEUs for Phase 1 of CORSIA, depending on traffic developments. Guyana has already sold a portion of its issued 7 million EEUs, with the remaining units available for purchase at the event.
“This is the first time such an event is being organized, and it couldn’t come sooner,” said Marie Owens Thomsen, IATA’s Senior Vice President Sustainability and Chief Economist. “States agreed to CORSIA, but so far Guyana is the only country fulfilling its obligation to make the needed carbon credits available. CORSIA is critical to aviation’s decarbonization efforts, and this event will be a clarion call that states need to make it possible for airlines to comply by releasing the requisite EEUs.”
The event marks a major step in establishing an efficient market for EEUs. The early availability of these units, ahead of reporting deadlines, is crucial for enhancing market liquidity and transparency. This early access helps avoid a last-minute scramble for limited supply, which could drive up costs for airlines’ decarbonization efforts without offering any added benefits.
“It takes a lot of effort to build the capabilities for generating CORSIA-eligible EEUs,” said Pradeepa Bholanath, Senior Director, Climate Change, Ministry of Natural Resources of the Government of Guyana. “Guyana is proud to be contributing, but we also want to see a large, active market. Many other countries have made progress towards creating credit supply, but before they commit to going further, they are waiting to see if the market delivers results. As the first mover in the market, we want to prove to other countries that it’s in their best interests to move forward. They should feel confident that they will receive fair prices for their credits and that accelerating the remaining work is worthwhile. This procurement event provides a further chance to create that confidence.”
This event is a significant step forward in the aviation industry’s commitment to sustainable practices and the fight against climate change. By fostering an efficient market for EEUs, this event will help airlines meet their CORSIA obligations and contribute to a greener future for air travel.
