ICAO policies & action
The International Civil Aviation Organization
ICAO is a UN agency, which governments created in 1944 with the aim of promoting the safe and efficient development of civil aviation (ICAO, 2020c). Environmental protection has historically not been an ICAO focus point.
In 1983, the ICAO Council established the technical Committee on Aviation Environmental Protection (CAEP) to assist it in developing new policies and Standards and Recommended Practices (SARPs) related to environmental protection. In 1997, countries decided that Annex I Parties to the UNFCCC “shall pursue limitation or reduction of emissions of greenhouse gases […] from aviation […] bunker fuels, working through the International Civil Aviation Organization” (UNFCCC, 1997). However, it took the ICAO Assembly – composed of 193 Member States - until 2013 to agree on the goal of ‘carbon neutral growth from 2020’ (ICAO, 2013). In 2016, the ICAO Assembly established the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), which started its pilot phase in January 2021 (ICAO Assembly, 2016).
Projected emissions in the COVID-19 era
The impact of the COVID-19 pandemic on future emissions from international aviation is uncertain. ICAO’s CAEP estimates that aviation’s level of activity may return to 2019 levels by 2024 in a high recovery scenario, while in a low recovery scenario they would return to 2019 levels by 2032 (ICAO, 2022).
In its latest Environmental Report, ICAO projects that emissions from international aviation will reach 1100 to 1500 Mt CO2 by 2050, where the upper bound (called “CAEP-12 baseline”) assumes fleet renewal but no additional technology and operational improvements. The lower bound assumes technological and operational improvements, but no drastic changes compared to BAU (ICAO, 2022). ICAO further notes that uncertainties around demand for international aviation will influence future CO2 emissions and provides three demand forecasts; the ‘medium demand’ forecast is the basis for ICAO’s CAEP-12 baseline (ICAO, 2022).
We base our projection of future emissions on ICAO’s projections. We determined the upper bound of our current policy projections as follows:
- We calculated CO2 emissions under ICAO’s ‘medium demand’ and ‘high demand’ forecasts (Figure 1-5 in ICAO (2022). We used ICAO’s assumption that combusting 1 kg of jet fuel generates 3.16 kg of CO2;
- We determined the percentual difference in annual CO2 emissions under the ‘medium demand’ and ‘high demand’ forecasts;
- We increased the CAEP-12 baseline by this percentual difference.
As we do not know the assumptions behind ICAO’s lower bound projections, and how operational and technological improvements would be influenced by a change in demand, we used ICAO’s lowest projection for CO2 emissions from international aviation (i.e. the lower bound of the orange-shaded area in Figure 1-5 in ICAO (2022)).
CORSIA is a market-based measure set up by ICAO in 2016 that allows airlines to offset their increase in emissions through carbon offset credits, or through the use of alternative fuels. The scheme is currently planned to run across three phases, from 2021 to 2035. ICAO’s Member States expect CORSIA to play an important role in achieving carbon neutral growth from 2020 (ICAO, 2019b). However, the scheme has significant shortcomings, which make it unlikely international aviation will achieve its target. Further, CORSIA is planned to end in 2035 and ICAO has currently no plans for the period after that.
CORSIA’s coverage is limited. The scheme is designed to compensate for any increase in aggregate CO2 emissions on routes that are covered by the scheme through the purchase and retirement of emission units, which represent emission reductions or removals elsewhere.
The scheme applies only to flights between two states that participate in CORSIA, so for the scheme to cover a majority of international aviation emissions, it is crucial to have participation from the country pairs that represent the majority of international air traffic. The following example makes this clear: if all countries participate, CORSIA would cover 100% of international aviation emissions in the period 2021-2035. If three of the countries responsible for a major share of international air traffic – for example China, the United Kingdom and the United States – do not participate, coverage would drop to merely 57% across CORSIA’s three phases (EDF, 2019).
Participation in CORSIA is voluntary at first and will be phased in for countries above certain economic and travel thresholds over time. However, countries may file a “difference” between their own regulations and the Standards and Recommended Practices (SARPs) that outline the CORSIA rules. By filing a difference, countries can justify non-compliance with CORSIA (Mendes de Leon et al., 2015; ICAO, 2018).
Eighty-three states participate in CORSIA from its inception in January 2021 (ICAO, 2020a). Although these 83 states account for more than 75% of international aviation traffic (ICAO, 2020b), flights between them cover less than 50% of international aviation emissions (EDF, 2019). Notably, Brazil, China, India and Russia do not participate. These four countries filed reservations on an ICAO Assembly Resolution that specified important aspects of CORSIA (Brazil, 2019; China, 2019; India, 2019; Russia, 2019). It is not possible to determine whether these countries also filed differences with the CORSIA SARPs, because differences are not publicly available. However, based on the reservations, we consider it likely these four countries did file a difference between the CORSIA SARPs and domestic regulations.
In June 2021, 18 developing countries, mostly Small Islands Developing States notified ICAO of their decision to voluntarily participate in CORSIA starting in January 2022 (ICAO, 2021). Given that – even jointly – these countries are responsible for an insignificant share of international aviation emissions, their participation does not make CORSIA more effective.
Emission offsets are likely to deliver insufficient reductions due to heterogenous quality. Under CORSIA, aircraft operators can purchase emission units to offset any growth in emissions. For emission units to neutralise emissions, it is imperative they:
- Represent additional emission reductions that would not have occurred in the absence of CORSIA;
- Do not result in an increase in emissions elsewhere in the world;
- Are accurately measured, reported, and verified;
- Are permanent; and
- Are used and claimed only once towards any type of climate target.
The ICAO Council approved a set of emissions unit eligibility criteria. These include eight criteria for the emissions units and 11 criteria for the programmes supplying these units (ICAO, 2020e). However, independent analysis of the programmes approved for the pilot phase show that the ICAO is not following its own eligibility criteria (Schneider et al., 2019). Chief among the concerns is that many of these programmes cannot guarantee that the emissions units generated are additional (i.e. would not have occurred in the absence of CORSIA) and will only be used to meet one climate target.
Expected emissions unit prices are unlikely to trigger investments in operational and technical measures to reduce CO2 emissions from international aviation. Various assessments predict the supply of emissions units is likely to exceed CORSIA’s demand (Fearnehough et al., 2019; Ecosystem Marketplace, 2020). This oversupply will be exacerbated by COVID-19 and a revision of CORSIA’s baseline due to a drop in near-term demand.
Prices for these emissions units were fairly low in recent years– approximately EUR 3 per tonne of CO2 between 2016 and 2018 (Forest Trends’ Ecosystem Marketplace, 2019). In May 2021, CAEP estimated that the price of eligible units could range from USD 0.9 to USD 9.30 in 2021; and from USD1.45 to USD 15.00 by 2026. Even a price of USD 15 per tonne of CO2 provides airlines a very limited incentive to reduce emissions though technical and operational measures, because purchasing offset credits is cheaper.
CORSIA eligible fuels may not deliver sufficient reductions. Along with purchasing and cancelling emissions units, airlines can use lower carbon or sustainable aviation fuels that are eligible under CORSIA against their emissions targets (ICAO, 2019b).
At the time of writing, national representatives working through the ICAO Council have approved two criteria for eligible fuels (ICAO, 2019a):
1) Fuels must achieve net GHG emission reductions of at least 10% compared to standard jet fuel, and;
2) Fuels must not be made from biomass sources from land with a high carbon stock.
The first criterion of 10% could, pending further rule making, allow for a wide range of lower carbon fuels to be used as ‘CORSIA eligible fuels’. Aircraft operators can claim the life cycle emissions benefits, which means that if an eligible fuel leads to a 10% reduction, the aircraft operator can claim 10% emissions reduction, if the fuel leads to a 30% reduction compared to standard fuel, aircraft operators can claim 30% (paragraph 3.3.1, ICAO, 2018a). While the use of lower carbon fuels is unlikely to lead to decarbonising international aviation, it may help achieve the goal of carbon neutral growth from 2020.
The second criterion should ensure that the production of biofuels used under CORSIA does not result in a stark increase in emissions caused by indirect land use changes (ILUC). Therefore, the Committee on Aviation Environmental Protection (CAEP), which is a technical committee of the ICAO Council and which negotiated and prepared most of the technical rules for CORSIA, determined the Indirect Land Use Change (ILUC) emissions from various biofuels. However, the CAEP’s methodology to derive ILUC emissions is based on optimistic assumptions and has led to significant optimism bias in the default ILUC values (Malins, 2019). Accordingly, aircraft operators may claim higher emission reductions than those actually achieved.