CORSIA and air cargo: Navigating cost, compliance and climate challenge

Aviation’s role in global climate change is under sharper scrutiny than ever . According to the International Energy Agency, i n 2023, the sector was responsible for 2.5% of global CO 2 emissions , enough to place it among the top ten emitters if it were a country. While passenger travel dominates public debate, cargo operations are an outsized contributor relative to their share of total flights, relying heavily on older, less fuel-efficient aircraft. Yet unlike many industries, international aviation is not bound by the Paris Agreement. Instead, the International Civil Aviation Organization (ICAO) has implemented the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) , a market-based measure designed to cap post-2020 emissions growth and steer the sector toward net-zero by 2050. For the global air cargo industry, CORSIA is more than just a compliance box to tick — it is a complex mix of financial liability, operational challenge and strategic opportunity. Context: Aviation's c limate r esponsibility Unlike many industries, international aviation emissions are not covered under the United Nations Framework Convention on Climate Change’s Paris Agreement. Instead, the ICAO introduced CORSIA in 2016 as a global solution focused on offsetting post-2020 emissions growth from international aviation. ICAO also has a long-term goal of reaching net-zero emissions by 2050. Figure 1: Annual CO₂ emissions from aviation (Source/Cargo Facts analysis of Organization for Economic Co-operation and Development data)

The figure above displays annual CO2 emissions from commercial passenger aviation , both domestic and international flights. International aviation emissions are assigned to the country of departure. C argo - only flights are not included in this graphic . While cargo flights make up approximately 3 % to 5% of total flights globally, they produce 7 % to 9% of total aviation CO 2 emissions as cargo carriers generally rely upon older , less fuel-efficient aircraft. On a per - flight basis, a Boeing 747-8 freighter burns around 22 tons to 30 tons of fuel per hour, which, using a standard emissions factor (3.15 kg CO 2 per kg fuel), corresponds to approximately 70 tons to 95 tons of CO 2 emitted per hour. For travelers and cargo shippers, environmental responsibility is paramount. According to Statista , 83% of global travelers believe that sustainable travel is important. For air cargo operators servicing international routes, CORSIA presents both a regulatory obligation and a potential strategic opportunity. CORSIA in b rief CORSIA is being rolled out in three phases: Pilot Phase (2021 - 2023) : Voluntary participation. Over 80 countries — including the U nited States, Canada and the European Union — opted in. This phase allowed airlines and regulators to build systems and gather experience in emissions monitoring, reporting and offsetting. Phase I (2024 - 2026) : Still voluntary, but participation has expanded to 129 countries. Airlines must purchase offsets for CO₂ emissions that exceed 85% of their 2019 levels. Phase II (2027 - 2035) : Becomes mandatory for most ICAO member states, with exemptions for: Least d eveloped c ountries ; Small i sland d eveloping s tates ; and Landlocked d eveloping c ountries . Th e final phase represents the full ambition of CORSIA: a global, market-based measure to cap international aviation emissions. CORSIA is legally enforced via Annex 16 of the Chicago Convention and applies to all 193 ICAO member states. Emissions are tracked using a m onitoring , r eporting and v erification (MRV) system. Operators must purchase carbon offsets if their emissions exceed 85% of the 2019 baseline , accounting for the impact of the pandemic on aviation activity. For instance, in 2025, European airline CO₂ emissions are projected to exceed pre-pandemic levels by 4%, reaching approximately 195 million tons. Globally, international aviation emissions rose by about 70% between 2005 and 2020 and could once again grow by over 300 % by 2050 without additional intervention . Cargo operators emitting more than 10,000 metric tons of CO₂ annually from international flights operated by aircraft with a maximum takeoff weight of more than 12,566 pounds must comply with MRV and offsetting requirements. This includes scheduled freighter operators as well as ACMI and charter providers. Exemptions include emissions from humanitarian, medical and firefighting flights, as well as repositioning flights associated with those operations. Boeing subsidiary Jeppesen , a global leader in navigation solutions, estimates that current CORSIA participants account for 60% of global international flight emissions. By 2027, CORSIA will cover nearly 85% after including major markets such as China, Brazil and India. Offset m arkets , c redit s upply Airlines must purchase e ligible e missions u nits (EEUs) to offset emissions exceeding the CORSIA baseline. An EEU is equivalent to 1 metric ton of CO2 emissions reduction. To be valid under the program , EEUs must meet ICAO’s stringent criteria and be authorized by host countries to avoid double-counting under the Paris Agreement. One of the core challenges CORSIA faces is a scarcity of eligible, vetted carbon credits. ICAO-approved programs include Verra, Gold Standard, ACR and ART TREES. As of July , Guyana remains the only country supplying CORSIA-eligible EEUs via jurisdictional REDD+ credits. These were sold in a fixed-price procurement event in late 2024 at $21.70 per ton. Thirty-two airlines participated, with 11 making purchases to meet Phase I obligations (2024 - 2026). Airlines must cancel their EEUs by Jan . 31, 2028, to remain compliant. To support the market, IATA and Xpansiv (via the Aviation Carbon Exchange) have organized quarterly procurement events. These aim to foster transparency, establish market confidence and send strong price signals to encourage greater participation by credit-supplying countries. Offset prices range from $18 to $ 51 per metric ton in early phases, with projected increases as demand rises in Phase II. For a cargo operator emitting 100,000 tons annually, offset liabilities could total millions of dollars per year. SAF: Crucial but c ostly c omplement Sustainable aviation fuel (SAF) feedstocks include oil-bearing energy crops, woody biomass (including invasive alien plants), municipal solid waste, sugarcane molasses and industrial waste gases. These feedstocks require varied and often costly processing technologies. Other than the scarcity of supply, another major hurdle to SAF adoption is that it costs two to five times more than fossil jet fuel. Some incentives are available to help mitigate these costs; the U.S. Inflation Reduction Act includes SAF tax credits (up to $1.75/gallon , depending on emissions reductions). According to IATA, global SAF production was around 1.3 billion liters in 2024 or less than 1% of the global aviation fuel usage. 2025 estimates see SAF production reaching 2.7 billion liters. Some airlines have committed to achieving 10% SAF usage by 2030 — a bold and ambitious goal considering current supply concerns . ICAO estimates that for CORSIA’s long-term success, SAF use must increase by 100 to 150 times by 2050. The U.S. Department of Energy quotes ICAO stating that as of 2023 , more than 360,000 commercial flights had uploaded SAF at 46 airports largely concentrated in the United States and Europe. Figure 2: Global SAF production (Source/Cargo Facts analysis of IATA data)

F urther driving adoption , the EU will soon institute these SAF blending mandates : 2% by 2025 6% by 2030 70% by 2050 To reach ICAO’s goal of net zero CO2 emissions by 2050, IATA analysis shows that between 3,000 to over 6,500 new renewable fuel plants will be needed. These will also produce renewable diesel and fuels for other industries. The annual average CapEx needed to build those facilities over the 30-year period is about $128 billion per year, in a best-case scenario. Importantly, this amount is significantly less than the estimated total sum of investments in the solar and wind energy markets at $280 billion per annum between 2004 and 2022. IATA also leans toward co-production of SAF in existing refineries alongside crude oil production. Co-production in existing refineries would decrease the CapEx outlined above by just less than $350 billion by 2050 . A pivotal moment CORSIA represents a pivotal moment for international aviation and particularly for cargo operators whose fleets and route structures can amplify emissions exposure. Success will require more than purchasing offsets — it will demand integrated strategies that combine fuel efficiency upgrades, route optimization and the gradual adoption of SAF . While the path forward is costly and logistically demanding, the alternative is falling behind in a market where environmental performance is becoming as important as service reliability and price. For air cargo carriers, CORSIA is not merely a regulatory hurdle — it is a proving ground for the industry’s ability to align profitability with planetary responsibility. The next decade will determine whether the sector rises to that challenge or allows others to define its climate future.

CORSIA and air cargo: Navigating cost, compliance and climate challenge

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