Aeronautics | 08. June 2021 | posted by Florian Wozny

Climate-neutral flight through carbon dioxide offsets – an interim solution

Flugzeug am Himmel
Credit: DLR/Alejandro Morellon (CC-BY 3.0)
More environmentally friendly air transport of the future – interim goal of climate-neutral flight

Since 2021, airlines have had to offset emissions on international flights that exceed the average values for 2019. This is done with the help of carbon dioxide compensation projects that invest in renewable energy sources or the preservation of forests, for example – that is, reduce or store greenhouse gas emissions. Credits are then issued for these projects. However, the climate impact of the credits depends strongly on the underlying project types. In a new DLR discussion paper, my team and I show the limits of mandatory offsetting.

Rising fuel prices have already led to airlines investing in technological advancements, as fuel accounts for approximately one third of total operating costs. For example, engines and combustion processes have been improved over the years. Fuel consumption is falling by about two percent per year. However, the environmental benefits have been offset by the enormous increase in air traffic. Policy-makers are faced with a dilemma.##markend##

So how can we move forward? Research is still being conducted on new technologies for cleaner flight, such as synthetic fuels. The rapid advances in electric vehicles are not transferable to air transport, as batteries with the necessary power are too heavy for aircraft. Direct hydrogen combustion would be technologically feasible but contributes to what are referred to as non-carbon-dioxide climate effects, or condensation trails, the climate impact of which is at least as great as that of carbon dioxide.

From an economic point of view, offsetting carbon dioxide emissions from air transport is an attractive and 'quick' solution for the industry given the current state of propulsion technologies. For this reason, the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) compensation programme was adopted. As of 2021, it obliges airlines to offset carbon dioxide emissions with compensation credits. However, this only applies to a limited extent, namely for emissions on international flights and only if they are above the average value for 2019.

Carbon dioxide offsetting is very complex. Three basic criteria are essential for its climate impact and form the basis of CORSIA:

  1. Additionality
    It must be ensured that no carbon reduction would have taken place without an offset project. This criterion is not met if, for example, a wind farm that is financed and built today by an offset project would have been built tomorrow anyway due to other circumstances or its financial attractiveness.
  2. 'Non leakage'
    Carbon reductions in one place must not lead to increased carbon emissions elsewhere. For example, if a forest that is threatened by deforestation is protected by an offset project, it must be ensured that deforestation does not take place elsewhere instead.
  3. Permanence
    Today's reduction can be cancelled tomorrow. The protection of forests, for example, must be guaranteed for at least 100 years for a climate impact to occur. That is quite a long time, considering how much humans have changed the landscape over the last 100 years.

Companies and non-profit organisations have emerged that promise compliance with the criteria by certifying and monitoring offset projects. Under CORSIA, only projects from certified organisations are allowed. Nevertheless, the supply of certified credits is enormous. By analysing the CORSIA-eligible offers, I have been able to show with colleagues in a study that the majority of offsets are generated in projects that often do not meet the three criteria described above. CORSIA's promise of climate neutrality is thus very difficult to fulfil.

Source: Wozny et al. 2021
The figure illustrates the share that the largest offset projects have in the total offerings of the three most important verification standards – CDM, Gold Standard and VERRA. Projects that are larger than 80 percent of the other projects account for well over half of all offset offerings.

Certification organisations find themselves in a dilemma. The higher the demand for offset credits, the larger the projects that are needed to meet the demand. But the larger the projects, the more difficult it becomes to meet the three criteria for climate impact. For example, larger projects are more profitable due to economies of scale and thus more attractive to private investors. However, this calls the additionality criterion into question. Because as soon as something is financially attractive, business models often already emerge through market mechanisms – so positive climate effects would no longer be additional.

Buying carbon dioxide offsets during booking transactions – (not) a good idea?

People have become increasingly aware of the climate impact of travel in recent years – 'flight shame' has become a catchphrase for a sense of responsibility. Carbon dioxide offsets, which are offered as options when booking flights, certainly make sense independently of CORSIA and as a voluntary additional concept to promote greenhouse gas reduction projects. However, those who travel should be aware that carbon dioxide offsets are only an intermediate step on the way to more climate-friendly air transport. They are not intended to convey a feeling of complete relief or even to encourage travellers to fly more. Interpreted in this way, carbon dioxide offsets would even be harmful to the climate.

It is not easy for air travellers to identify offset projects with a high climate impact. You can offset a tonne of carbon dioxide for as little as three euros. But if you choose a different offset project, a tonne of carbon dioxide can cost 25 euros. The fundamental problem here is that the prices of offset credits do not reveal much about the climate impact of the projects behind them. Our results show that more expensive credits do not necessarily have a higher probability of fulfilling the important criterion of additionality. So, we cannot use prices as a rule of thumb, but need to look more closely.

There are offset credits with good climate impact that passengers can purchase directly from the airline or from third-party providers. One example is certified projects to improve the energy efficiency of private households – for example, by providing resource-saving cooking stoves, since in many countries food is still prepared over an open flame with high energy consumption. Regulatory improvements could also be made, for example through a more restrictive selection of approved offset projects under CORSIA.


About the author

After studying economics in Cologne, Florian Wozny completed his doctorate in Potsdam at the Chair of Empirical Economics Research. At the same time, he conducted research on environmental and health economics issues at the Research Institute for the Future of Work in Bonn. to authorpage