The International Air Transport Association (IATA) has launched the Aviation Carbon Exchange (ACE), a new trading tool that would support the airline industry to attain their climate commitments.
With this initiation, ACE becomes the first centralized, real-time marketplace that has combined with the IATA Clearing House (ICH) for arranging funds to trade in carbon offsets. The American low-cost airlines group JetBlue Airways made the first transaction on the ACE platform.
The Clearing House guarantees that ACE will deliver a smooth and secure settlement system that offers payment and delivery of the carbon credits.
“Airlines are serious in their commitment to reducing emissions. And they need a reliable tool to access quality carbon credits in real-time. ACE will be a key tool helping airlines efficiently manage these important transactions.”
The 76th IATA Annual General Meeting (AGM) had taken a resolution to reduce the net emissions to half 2005 levels by 2050 as part of which the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) was formulated that would offer carbon-neutral growth for international emissions from 2021.
Following the resolution, airlines are also buying carbon credits as part of individual carrier commitments or to balance domestic operations.
The American aviation group JetBlue made the historic first trade on the ACE platform by buying credits in the first phase of the Larimar wind farm project in the Dominican Republic that started construction in 2015. Once completed the project is estimated to cut average emissions by over 200,000 tones of CO2 per year.
“While our industry’s short-term priorities are focused on COVID-19 recovery, now is the time to rebuild operations in more sustainable ways such as adopting Sustainable Aviation Fuels (SAF) and setting clear strategies to reduce net aviation CO2 emissions,” said Robin Hayes, CEO of JetBlue and Chair of the IATA Board of Governors.
The Aviation Carbon Exchange (ACE) which has been created in conjunction with commodities trader Xpansiv CBL Holding, targets to offer the airlines and other aviation sections like airports and aircraft manufacturers the opportunity to balance their carbon footprint by acquiring credits in certified projects that cut emission.
The carbon reduction programs of ACE include forestry projects, clean wind energy operations, protection of ecosystems and remote community-based projects to cut emissions. ACE will be a significant tool for airlines in accomplishing their obligations under CORSIA which was agreed by governments through the International Civil Aviation Organization (ICAO) in 2016.