Two high-profile NGOs have argued that the European Union should press ahead with expansion of its Emissions Trading System (ETS) to cover more flights, rather than relying on ICAO’s “flawed” CORSIA scheme in the effort to decarbonise commercial aviation.
Representatives from Transport & Environment and Carbon Market Watch were speaking on 22 September during a press briefing ahead of the latest triennial ICAO Assembly, which begins in Montreal on 23 September and will set the pathway for international aviation regulation over the coming years.
Some stakeholders are using ICAO’s CORSIA – the Carbon Offsetting and Reduction Scheme for International Aviation agreed in 2016 – as “a bit of a distraction and an excuse for the European Union not to act and extend its Emissions Trading System”, argues T&E’s aviation policy officer Marte van der Graaf.
Such comments contrast sharply to pro-CORSIA remarks made by IATA ahead of the ICAO assembly, with the airline industry association insisting that the UN scheme ensures a “level playing field” by avoiding a “patchwork” of regulation around the world.
A major issue is that CORSIA, which began under voluntary participation in 2021, “has fallen short of delivering meaningful climate action and will result in billions of euros being wasted on dodgy offsetting companies”, the two NGOs say.
T&E estimates CORSIA will cost European aviation €7 billion ($8.2 billion) to €43 billion over the next 10 years, depending on the cost of carbon credits.
And crucially, while IATA recently described CORSIA’s carbon credits as a global “gold standard”, the NGOs say they fall “seriously short” amid issues with “lax eligibility criteria”. In contrast, the EU ETS scheme is based on the cap-and-trade model which avoids issues with the quality of offsetting projects.
They further highlight the fact that countries such as Brazil, China, India and Russia are not taking part in the current, voluntary, phase of the CORSIA scheme, limiting its scope. At the same time, CORSIA is estimated to cover only 26% of emissions from commercial aviation by 2035, T&E research shows.
And CORSIA credits “remain far cheaper” than ETS ones, the NGOs say, meaning they provide a limited incentive for airlines to decarbonise.
Carbon Market Watch’s policy lead on global carbon markets Jonathan Crook also pushes back against the idea that credits from carbon offsetting schemes channel funds into local communities, citing “a huge lack of transparency on the carbon credit markets regarding financial flows”.
“One really doesn’t know how much of the finance goes to the ground and really supports projects,” Crook states.
Expanding the scope of the EU’s ETS – which currently only covers intra-EU flights – would generate “billions more annually” which could be used for direct investment into aviation’s decarbonisation, the NGOs say. One such scenario would see the ETS extended to all flights departing the bloc, which they estimate would generate €259 billion in revenue in the 2025-2040 timeframe (versus €112 billion from leaving the ETS as it is).
The European Commission is due to propose revisions to the ETS in September 2026. Part of its consideration is the effectiveness or otherwise of CORSIA.
European airlines – often through industry body Airlines for Europe (A4E) – regularly push back against the extension of the ETS, arguing that it would damage the competitiveness of the region’s operators.
