IATA Opens Aviation Carbon Exchange To Facilitate Offsets

 - November 25, 2020, 10:07 AM

The International Air Transport Association (IATA) has launched an Aviation Carbon Exchange (ACE) that the industry group said will help airlines to meet their commitments to reducing their impact on the climate. In a statement on Wednesday, the association announced that U.S.-based JetBlue Airways has become the first operator to make carbon offset transactions through the platform.

ACE has been devised as a centralized, real-time marketplace that is integrated with the existing IATA Clearing House for the settlement of funds transferred for carbon offset trades. According to IATA, this gives airlines an easy and secure way to conduct these transactions.

The new system was announced at the close of IATA’s 76th annual General Meeting, during which member carriers reiterated their commitment to cutting net emissions from flights to half of 2005 levels by 2050. The group says that the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) is expected to result in carbon-neutral growth for international emissions from 2021. At the same time, individual airlines are also buying carbon credits to offset the impact of domestic flights.

JetBlue’s first trade through the ACE platform involved purchasing credits to support the first phase of the Larimar wind farm project in the Dominican Republic. It is expected that when this project is completed, it will reduce average emissions by more than 200,000 tonnes of carbon dioxide each year.

“Airlines are serious in their commitments to reduce emissions,” commented outgoing IATA director general and CEO Alexandre de Juniac. “ACE will be a key tool in helping airlines efficiently manage these important transactions.”

During its AGM, IATA also called on governments around the world to support further growth in the use of sustainable aviation fuels (SAF). The group said additional state stimulus packages are needed to promote SAF availability through direct investment, loan guarantees, and incentives for the private sector. It also proposed new regulations to divert the materials needed to produce SAF towards aviation, which faces greater challenges than other lower-carbon transport operations with regard to reducing emissions.

According to IATA, SAF is currently around two to four times more costly than fossil fuels at a global annual production rate of around 100 million liters, which amounts to just 0.1 percent of all aviation fuel. It said government support could boost output to between six and seven billion liters, which would constitute 2 percent of all aircraft fuel.