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Airline Optimism On Carbon Offsetting Prevails As ICAO Assembly Nears

Chris Kjelgaard explains why the Air Transport Action Group, IATA and airlines are optimistic that the 39th ICAO Assembly which begins on September 27 will produce agreement on a mandatory global carbon offset scheme for civil aviation.

Chris Kjelgaard explains why the Air Transport Action Group, IATA and airlines are optimistic that the 39th ICAO Assembly which begins on September 27 will produce agreement on a mandatory global carbon offset scheme for civil aviation.

On September 5, the Air Transport Action Group (ATAG), an organization which represents the entire civil-aviation sector in coordinating common industry positions on the sustainable future of air transport, welcomed announcements by the USA, China and 44 European nations that they would voluntarily join a global carbon offsetting and reduction scheme for aviation.

At the International Civil Aviation Organization’s 38th Assembly (in 2013), its 191 contracting states mandated ICAO to present a proposal for a global market-based measure (MBM) to manage aviation’s carbon footprint at its 39th Assembly, which will take place from September 27 to October 7.

ICAO is the Montreal-based United Nations body which oversees international regulation of civil aviation. But international aviation is not included in the agreement reached by the United Nations Framework Convention on Climate Change (UNFCCC) in December 2015.

However, within ICAO, a global Carbon Offset and Reduction Scheme for International Aviation (CORSIA) is now being negotiated. The USA, China and most European countries have CORSIA in mind in expressing their willingness to join a global aviation carbon-offsetting scheme voluntarily.

Discussions with ICAO’s member states on CORSIA are focusing on the major design elements of the scheme – the draft negotiating text of which ICAO published on September 2 – and follow three years of talks which are due to conclude at the 39th ICAO Assembly, according to ATAG.

In a September 5 statement, Michael Gill, executive director of ATAG, remarked: “We were encouraged by the spirit of constructive engagement shown by governments at ICAO during the most recent informal discussions. Progress was made in finding areas of convergence between country positions.

“We are confident that spirit will continue as we head into the ICAO Assembly, where we strongly urge governments to finalise the design aspects of the carbon offsetting scheme for international aviation.”

On September 6, a day after ATAG expressed the encouragement it felt at the strong evidence of multinational support for CORSIA, IATA – a member of ATAG – endorsed ATAG’s view.

That day, in a news release of its own, IATA expressed optimism that the 39th ICAO Assembly would result in ICAO’s member states agreeing on the need for a market-based measure to be mandated and become effective – partially, at least – from January 1, 2021.

In this news release, Alexandre de Juniac, who took office as IATAs new director general and CEO on September 1, stated, “"I am optimistic that we are on the brink of a historic agreement—a first for an industry sector at the global level.”

Nevertheless, both ATAG and IATA made the point that the civil-aviation industry would have preferred ICAO to be less cautious in its structuring of the proposed CORSIA agreement.

IATA agreed in its news release that CORSIA “broadly aligns with the aviation industry’s call for a mandatory global carbon offset scheme as a tool to help manage the industry’s emissions as it pursues its goal of carbon-neutral growth.”

But the airline-industry’s leading international trade association noted that “Instead of being mandatory from the start … the draft text defines a voluntary “pilot and implementation” period (2021-2027) after which participation would be mandatory for all eligible States (2027 onwards).”

However, “The aviation industry would have preferred a more ambitious timeline than is currently outlined in the draft text,” de Juniac said. In fact, IATA pointed out that at its annual general meeting in June, “An overwhelming majority of IATA member airlines reiterated their desire to see a single, global and mandatory carbon offset scheme be implemented from 2020.”

According to IATA, a mandatory carbon-offsetting scheme becoming effective in 2020 would fulfil one pillar of the industry’s four-pillar strategy on climate change. This consists of:

1. Improvements in technology and the deployment of sustainable alternative fuels;
2. Operational efficiency;
3. Infrastructure optimization; and
4. A global market-based measure (such as CORSIA).

Similarly, on September 5, ATAG’s Gill said his organization was slightly underwhelmed with ICAO’s CORSIA draft negotiating text: “We are cautious about several developments. We do not feel a pilot phase is necessary, because airlines and other aircraft operators will be ready and able to commence the scheme from 2020.”

Gill added: “Offsetting is not a new concept. Indeed, a large number of airlines already offer offsetting to passengers on a voluntary basis. What the industry does need is certainty, with a clear set of metrics defined before the scheme commences and consistently applied throughout its lifetime.”

ATAG’s executive director continued: “Since we first urged governments to develop a global carbon offsetting scheme as part of a basket of climate actions in 2009, we have promoted a mandatory measure covering a high proportion of international aviation emissions from day one of the scheme.

“The fact that the first six years of the current proposal is now voluntary in nature demonstrates the outcome of the continuing political discussions between States and their desire to reach a consensus-based agreement.”

ICAO’s CORSIA draft proposes that the period 2021 to 2023 represent only a “pilot” voluntary phase, involving countries which choose to be part of the scheme. A 2022 review would then be conducted on the implementation of CORSIA, to determine if any adjustments were needed before the scheme continued.

The period from 2024 to 2026 would represent the first implementation phase of CORSIA and would also be handled on a voluntary basis. (On September 6, an ATW Online news story on IATA’s call for CORSIA to be implemented more quickly than ICAO is planning noted that “it is questionable whether other large countries, including Brazil, India and Russia, will participate during the voluntary period.”)

From 2027 to 2035, the second, final phase of implementation of CORSIA would occur. This would include most states except those nations which were least developed, small island states and countries with only a small amount of international air traffic – which ICAO proposes as those with less than 0.5 per cent of global air traffic.

The second phase of CORSIA would provide for triennial technical adjustments to the distribution of obligations between individual airlines. This would move the MBM from a collective approach towards more of an individual approach, according to ATAG.

But despite the lack of urgency ATAG and IATA perceive in ICAO’s CORSIA proposal, as a result of ICAO’s desire to reach a consensus-based agreement on CORSIA with all its member states, they remain positive that agreement on the MBM will produce positive change.

“What is most important is that the substance of the negotiating text will allow for meaningful management of aviation’s carbon footprint. Airlines support it and urge governments to agree when they meet at ICAO," said de Juniac.

“Last year’s much-lauded Paris climate change agreement was a combination of voluntary measures to which the vast majority of countries have already committed themselves. We expect no less of an outcome from the ICAO Assembly. The industry is ready,” the IATA CEO added.

“There is really no reason for governments not to volunteer,” continued de Juniac. “Indeed, the United States, China, Canada, Indonesia, Mexico, the Marshall Islands, and 44 European countries have already indicated their willingness to participate. Now is the time for other states to match their political leadership, by coming to the Assembly already committed to participate, even if the scheme is voluntary at the initial stage.”
 
IATA’s new CEO emphasised that “Airlines are investing heavily in new technology, the development of sustainable alternative fuels and operational efficiency. Our message to the states attending the ICAO Assembly is that they must match our efforts.

“This is particularly the case with investments to modernize air navigation infrastructure which will bring cost-efficiency benefits along with improved environmental performance. Similarly, government incentives to commercialize sustainable alternative fuels are critical to unlocking their environmental benefits with increased production capacity and lower costs.”

Importantly, said ATAG executive director Gill, “Key to the scheme will be the proportion of international aviation emissions that are covered under the mechanism … We strongly encourage all States to demonstrate climate leadership by volunteering to be part of the scheme as early as possible.”

Gill concluded his statement on a forceful but optimistic note: “Climate change is a challenge the entire world must face with ambition, drive and purpose. The aviation sector, through hundreds of collaborative efforts around the world, has shown that carbon dioxide reductions are not only achievable; they are also beneficial to the business. We have passed that message on to regulators meeting at ICAO. It is unusual for an industry to be pushing governments to take this kind of economic action, but we believe it is time for aviation to show leadership and make an historic decision at the ICAO Assembly.”

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