22 January 2025 (Geneva) – The International Air Transport Association (IATA) announced its intention to hold regular procurement events in 2025 for airlines to purchase Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) Eligible Emissions Units (EEUs). This followed the successful conclusion of IATA’s first procurement event with the following highlights:

·                                   32 airlines participated

·                                   11 airlines purchased CORSIA Phase 1 EEUs from the Government of Guyana

This was the first large-scale purchase of CORSIA Phase 1 EEUs by airlines. The CORSIA EEUs purchased were Jurisdictional REDD+ ART Trees Guyana credits, which remain the only CORSIA EEUs available, and sold for $21.70 /tonne as part of the fixed-price auction/offering. These will be useable by airlines in fulfilling their CORSIA Phase 1 offsetting obligations covering traffic for the period 2024-2026. The EEUs must be canceled by 31 January 2028.

The first procurement event was open to airlines only and ran from 28 October to 29 November 2024, and was supported by the Government of Guyana, Mercuria, and Xpansiv. Xpansiv operates, with IATA, the Aviation Carbon Exchange (ACE) which facilitated the sale.

IATA, via the ACE, intends to host quarterly CORSIA EEUs procurement events for airlines in 2025, with the next event being held alongside Guyana and Mercuria in Q1.

Those involved with the first procurement event shared various perspectives:

“IATA’s procurement event provided an optimal transparent and auditable process for Pegasus to purchase credits to fulfill our obligations under CORSIA. We were pleased to acquire EEUs to support the market for high-integrity carbon credits that are essential for airlines to meet the ambitious emissions goals set in CORSIA,” said Barbaros Kubatoğlu, Pegasus Chief Financial Officer.

“The success of the first procurement event demonstrated the airline industry’s commitment to both the offsetting and reduction aspects of CORSIA, which is essential to the sector’s decarbonization goals. To serve the significant projected future demand for EEUs from airlines we look forward to holding similar events in 2025 and beyond. The major challenge is availability of credits to meet demand. The solution rests on the CORSIA agreement which obligates countries to make credits available. Other governments should follow Guyana’s strong lead,” said Marie Owens Thomsen, IATA’s Senior Vice President Sustainability and Chief Economist. 

“This event was successful because the participating airlines showed that they are willing to pay fair price for the countries and communities doing the hard work of protecting forests and mitigating climate change. For too long, this price signal was missing. Valuing nature in this way marks an important step toward recognizing the true value of natural ecosystems for sustainable development. If this is sustained, we could finally see real progress on ambitious climate action through financing forests in a way that benefits buyers, sellers and the entire world,” said Bharrat Jagdeo, Vice President of the Co-operative Republic of Guyana.

“Mercuria’s mission is to leverage the power of markets to direct funds to vital carbon offset projects and enable companies to meet their emissions targets. The procurement event sent an important signal that EEUs command a premium price, which should encourage greater supply to flow to CORSIA rather than other sources of offset demand,” said James Cooper, Head of Origination EMEA, Environmental Products, Mercuria.

“Since 2020 we have worked with IATA to develop a secure marketplace and infrastructure enabling airlines to transact high-quality carbon credits, including EEUs to fulfill CORSIA obligations. We were excited by the enthusiastic uptake of the first procurement event last year and are encouraged by the growing number of airlines joining ACE to participate in future events,” said John Melby, CEO, Xpansiv.