Source: IATA
- The event provides an important procurement opportunity amidst ongoing scarcity of CORSIA eligible EEUs
- At present, the State of Guyana is the only source of such EEUs
The International Air Transport Association (IATA) announced at its World Sustainability Symposium (WSS) that airlines will have the opportunity to buy Eligible Emissions Units (EEU) at a bespoke Procurement Event scheduled for the last quarter of 2024 on the Aviation Carbon Exchange (ACE). This event is being organized by IATA with the State of Guyana, Mercuria, and Xpansiv and is open to all airlines.
The EEUs on offer will be useable by airlines in fulfilling their Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) Phase 1 offsetting obligations. These obligations cover traffic for the period 2024-2026. The EEUs must be canceled by 31 January 2028.
The event provides an important procurement opportunity amidst ongoing scarcity of CORSIA eligible EEUs. At present, the State of Guyana is the only source of such EEUs. IATA estimates that airlines will need between 64 and 162 million EEUs for Phase 1 of CORSIA, depending on how traffic evolves. Guyana has already made sales from the 7 million issued EEUs and uncommitted volume will be available at the Procurement Event. “This is the first time such an event is being organized, and it couldn’t come sooner. 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,” said Marie Owens Thomsen, IATA’s Senior Vice President Sustainability and Chief Economist.
This event is an important step in the development of an efficient market for EEUs, the early release of which (ahead of reporting deadlines) is essential to promoting liquidity and transparency, and to preventing a late rush on limited supply that would likely add significant costs to airlines’ decarbonization with no additional benefits.
“It takes a lot of effort to build the capabilities for generating CORSIA-eligible EEUs. 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,” said Pradeepa Bholanath, Senior Director, Climate Change, Ministry of Natural Resources of the Government of Guyana.