Almost two-thirds of the carbon credits available to airlines under CORSIA’s first compliance phase have a “very high” likelihood of not delivering the emissions reductions they claim, according to a major study prepared for the European Commission and reported on September 23. Not a single tranche of assessed supply was rated low risk. The findings land at a sensitive moment: Brussels is legally required to judge whether CORSIA offers adequate environmental protection, and the answer will shape whether international aviation is pulled deeper into the EU Emissions Trading System, with direct consequences for airline compliance costs, credit procurement strategies and ticket prices.
What the Study Found
The study assessed emissions credits available for purchase during CORSIA’s first phase and graded their integrity. The results are stark: 63 percent of the assessed supply carried a very high likelihood of not reducing greenhouse gas emissions, 17 percent was rated high risk, and 20 percent medium risk. Zero percent made the low-risk category.
The demand context makes those grades material. According to the same EU-funded research, emissions covered by CORSIA exceeded the scheme’s baseline by 15.4 percent in 2024, obliging participating airlines to purchase approximately 56 million tonnes of CO2 credits. CORSIA, run by the UN aviation agency ICAO, requires airlines to buy approved credits when international aviation emissions rise above the agreed threshold, so every point of growth above the baseline converts directly into credit demand.
This integrity verdict also lands on top of a known supply problem. ICAO and IATA estimates circulated earlier this year put first-phase demand at roughly 170 to 236 million tonnes against eligible supply of only 36 to 38 million tonnes, with airlines facing a January 31, 2028 deadline to cancel units for the first compliance period. A market that was already short on volume now has an official-quality question mark over much of the volume that exists.
Why Brussels Is Asking Now
The study does not change any rule by itself. Its weight comes from the process it feeds. Under the EU ETS Directive, the Commission must evaluate whether CORSIA provides adequate environmental protection, covering the quality of offset credits, MRV, registries, enforceability and transparency. That assessment directly informs how international aviation should be treated under the bloc’s own carbon market.
Today the EU ETS applies mainly to flights within Europe, while CORSIA covers the extra-European international flights of European airlines. If the Commission concludes that CORSIA is not delivering, the default trajectory is an extension of EU ETS obligations to more international flights, replacing or topping up offsetting with allowance surrender at EU carbon prices.
Political momentum is already moving in that direction. An updated draft from a leading MEP in the European Parliament’s review of the EU ETS has scrapped a proposed CORSIA exemption under an extended system, according to Quantum Commodity Intelligence. Airlines have noticed: Lufthansa has publicly warned of significant additional costs from an ETS extension, and IAG reported a 26 percent rise in carbon compliance costs in the first half of the year as free allowances were withdrawn.
The Cost Math: 64 to 74 Percent by 2040
The study also modelled what tighter EU treatment would do to airline economics. Its central estimate: operating costs for flights departing Europe and landing outside the bloc could increase by 64 to 74 percent by 2040 compared with 2024 levels, depending on the regulatory scenario.
That is a modelling exercise, not a forecast, and it does not mean ticket prices rise by that amount. But the direction of travel is clear, and history suggests where the bill lands: part of any additional climate cost is passed through to passengers. For corporate travel budgets and for airlines’ own fuel and compliance planning, the range is now a concrete input rather than a hypothetical.
Implications for Buyers, Airlines and Developers
For airlines, the strategic problem compounds. Procurement teams that were already racing to secure scarce CORSIA-eligible supply before the 2028 cancellation deadline must now price in integrity risk on top of scarcity. Credits that clear ICAO’s eligibility bar may still fail a future EU adequacy test, which raises the value of units with strong corresponding adjustments, robust methodologies and, increasingly, removal-based supply.
For voluntary market buyers watching from adjacent desks, the signal is familiar. Regulators are converging on the same integrity screens that sophisticated corporate buyers have applied for years, and a study of this kind gives procurement teams internal cover to demand higher-quality supply and to walk away from cheap, high-risk tonnes.
For project developers, the message cuts both ways. Supply that can demonstrate durable, well-verified reductions stands to gain as eligibility tightens. Supply resting on weak additionality or contested baselines now carries a regulatory discount that no amount of ICAO eligibility can fully offset.
What to Watch
Three markers from here. First, the Commission’s formal CORSIA adequacy assessment: a negative read would set the legislative clock running on extending the EU ETS to outbound international flights. Second, the fate of the Parliament draft that scraps the CORSIA exemption: if it survives trilogue, the compliance cost curve for European carriers steepens well before 2040. Third, credit pricing: watch whether a quality premium opens up within CORSIA-eligible supply itself, splitting the market between tonnes that could survive an EU integrity screen and tonnes that cannot.
