CORSIA carbon credits and aviation trading solutions

CORSIA stands for the Carbon Offsetting and Reduction Scheme for International Aviation. It's a global scheme run by the International Civil Aviation Organization (ICAO), and it's the first market-based scheme to apply to a specific sector.

Under CORSIA, airlines and aircraft operators must offset CO₂ emissions from international flights above 85% of 2019 levels. International aviation falls outside national climate targets under the Paris Agreement, so CORSIA was created to fill that gap and stabilise emissions from the sector while broader decarbonisation efforts continue.

Airlines monitor their international CO₂ emissions and compare them against a baseline (85% of 2019 emissions). For emissions above that baseline, they must purchase and retire CORSIA Eligible Emissions Units (EEUs) - carbon credits that meet ICAO's strict eligibility criteria.

The scheme runs in three-year compliance periods. After each period, participants demonstrate they've met their obligations by retiring the required volume of EEUs.

EEUs are the carbon credits airlines use to meet CORSIA obligations. To qualify, a credit must meet five ICAO criteria:

• Programme eligibility sourced from an ICAO-approved programme
• Project age from a project that started in 2016 or later
• Activity compliance from a permitted emission reduction activity
• Vintage compliance generated in an eligible year
• Corresponding adjustments authorised by the host country to prevent double-counting

ICAO has approved several registries to issue eligible credits, including Verra (VCS) and Gold Standard.  

Phase 1 (2024–2026) is voluntary. Participating airlines purchase and retire EEUs to cover emissions above the 2019 baseline, with the first retirement deadline in January 2028.

Phase 2 (2027–2035) is mandatory for most ICAO member states. Coverage expands significantly, including all aircraft operators on international flights (passenger, cargo, business, and private), and is expected to cover around 85% of international aviation emissions once countries like China, Brazil, and India are included.

Demand for Phase 1 alone is forecast at 105–150 million EEUs, but only a small fraction of that supply has been issued to date. There are a few drivers:

• Host countries are still building the systems to issue corresponding adjustments
• Other sectors are competing for the same pool of credits
• ICAO's eligibility criteria narrow the qualifying project pool
• Registry processing and verification can lag behind demand

Forecasts point to continued supply tightness and rising prices through the rest of the decade, which is why early procurement matters.

CORSIA applies to international flights operated by passenger, cargo, business, and private aircraft operators. Domestic aviation isn't covered (that falls under the UNFCCC and Paris Agreement framework).

Phase 1 is voluntary, but most major international markets are already participating. From Phase 2 in 2027, participation becomes mandatory for most ICAO member states. Some exemptions apply based on a country's development stage, geography (small island or landlocked states), and share of international air traffic.

Penalties are set by individual national governments rather than by ICAO directly. The UK, for example, has consulted on penalties of £100 per tonne of CO₂e for non-compliance. Final frameworks are expected to be in place ahead of the first retirement deadline in January 2028.  

We source ICAO-approved Eligible Emissions Units through direct relationships with project developers, traders, and ICAO-approved registries. Credits are supplied through spot deals or multi-year forward contracts, depending on your compliance profile and risk appetite.

For more on how aviation buyers are approaching CORSIA in practice, read our piece on navigating CORSIA compliance.  

Voluntary carbon credits sit outside compliance frameworks; companies buy them to meet their own net-zero or sustainability commitments. CORSIA credits must meet a stricter set of ICAO eligibility criteria for use against regulatory obligations.

There's overlap in the projects and registries involved, but the bar for CORSIA eligibility is higher. Many credits that qualify for voluntary use do not qualify for CORSIA.