INTERVIEW: GenZero sees doubling CORSIA supply as momentum, but Phase Two pricing remains unclear

Global CORSIA-eligible carbon credit volumes have effectively doubled over the past six to nine months and now exceed 40 million tons, a sign that genuine market momentum is building after years of a narrow eligible supply base, according to a senior official at climate investment company GenZero. However, he cautioned that pricing and supply dynamics heading into the scheme's Phase Two remain considerably harder to forecast.

Speaking to Platts on July 3, following the launch of a new ASEAN CORSIA report co-authored by GenZero, Boeing, and Abatable, Puar Si Liang, vice president at GenZero, said the region's total addressable CORSIA opportunity spanning currently eligible, aligned, and pipeline carbon credits is estimated at between $1.6 billion and $8.5 billion through 2035, alongside close to 32,000 potential jobs across the region.

Puar said the report's headline figure of 36.8 million eligible units globally, current as of the report's cutoff date, has already been overtaken by more recent data.

"There is quite a bit of progress that's happening in the past six to nine months. Actually, the volume of CORSIA credits has effectively doubled. I think in our report we quoted 36.8 million, but I just saw a report earlier today(July 3) that we've crossed 40 million," he said.

On pricing, Puar said current CORSIA-eligible unit prices sit toward the lower end of the $10-$23/ton range observed over the past eight months, with most market observers expecting prices to rise as airlines approach the 2028 compliance deadline and demand intensifies. Beyond that point, however, visibility deteriorates sharply.

"On Phase Two, there are a couple of uncertainties. Naturally, given it's a bit further away, on the supply side, there are only four standards approved for Phase Two, so the supply picture is a little unclear. On the demand front, we have some estimates based on the expected growth of aviation and emissions, but there's also going to be some uncertainty given that it's a forecast further out," he said.

Puar identified fear of "overselling" -- authorizing more carbon credits for CORSIA use than a country can afford to give up against its own Nationally Determined Contribution climate targets -- as one of the most significant real barriers preventing ASEAN governments from issuing Letters of Authorization. Only Laos and Cambodia currently have direct experience issuing them.

He said the challenge runs deeper than politics alone, pointing to structural coordination failures within governments themselves.

"Sometimes it's a question of coordination within the government, within the ministries of environment or climate, which look after the NDCs, the line ministries that are responsible for implementing. And then also, quite often, the agencies that are looking at CORSIA are often not part of the picture," Puar said, adding that many governments also struggle to forecast and track domestic emissions and project pipelines seeking authorization.

"This is actually quite a complex system. There are many moving parts, and it's a difficult problem for governments to address. I think for a lot of governments, in terms of setting policies, it's an exercise in managing trade-offs," he said.

Article 6 deal signals broader regional readiness

Beyond CORSIA specifically, Puar said several ASEAN governments are exploring broader participation in Article 6 of the Paris Agreement, citing Thailand's bilateral carbon credit agreement with Switzerland as an early proof point, even though those particular units were not CORSIA-eligible.

"Thailand is actually the first country in ASEAN to issue some Article 6 units, through its collaboration with Switzerland. It's a sign that the country is ready. A lot of other countries in the region -- Vietnam, the Philippines -- are all thinking about how they can be involved in Article 6," he said.

Framing the report's broader significance, Puar said its central purpose was to demonstrate that CORSIA compliance and national climate goals need not be in tension with one another. "This is really about how this can be a win-win opportunity. It's very important for airlines and for CORSIA compliance, but this is also an opportunity for host countries, for ASEAN, in terms of the economic opportunity -- how having projects within your country leads to economic, social, and environmental benefits," he said.

Platts, part of S&P Global Energy, assessed sustainable aviation fuel HEFA-SPK FOB Straits at $2,405/metric ton July 7, down $20/mt from July 6.

The SAF FOB Straits premium was assessed at $1,497.50/mt over Platts Jet Kero FOB Singapore forward curve (MOPs), down $34.50/mt from July 6.