Changes to the CORSIA emissions baseline could have implications on carbon offset demand.

The Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) has been hailed as a positive contribution to the carbon offset market. CORSIA was originally designed to require airlines to keep emissions at the average annual emissions of 2019 and 2020. Carbon offsets would be used to bridge the gap for any increase in emissions. Covid-19’s impact on aviation could bring this all to a halt. In 2020, flights emissions have been reduced to 1995 emission levels. Using this baseline would significantly increase the number of offsets airlines must purchase – meeting the CORSIA requirements would become an arduous process. The International Air Transport Association (IATA) has asked that only 2019 emissions be accounted to determine the baseline emissions.

What is the possible impact of this rule change? If airlines are required to purchase offsets to prevent neutral emission growth from a 2019 baseline, their need for offsets may be pushed back many years – since in the near future emissions could be lower than the 2019 baseline. It is unknown how long it will take for airlines to rebound post-Covid and may not see any emissions growth for years. If airlines slowly rebound, and emissions are kept below the 2019 baseline, there would be no requirement for offset purchases. This will halt any climate change progress, and with ample supply of offsets should not be considered an option. Airlines are receiving major bailouts and should still be held accountable for their environmental impact.

The Environmental Defense Fund has pointed out a flexibility mechanism written in the CORSIA pilot phase rules. This mechanism gives the option for airlines to purchase offsets at 2020 levels multiplied by projected growth rate in the pilot phase. This allows airlines to avoid having to offset the average of 2019/2020 baseline emissions but does not allow the airlines to avoid purchasing offsets entirely. This would support the offset market and without creating unachievable standards. If the rules are changed to not consider 2020 emissions, the development of this new market demand will be pushed out many years. Obviously, no one can correctly predict the impacts Covid-19 will have on the airline industry and economy but this should not be at the peril of climate change mitigation.