Platts CEC price assessment reflects Phase 1 CORSIA credits, Jan 2, 2024

Platts, part of S&P Global Commodity Insights, reflects credits eligible under Phase 1 of the CORSIA scheme in its carbon price assessment for CORSIA eligible credits, the Platts CEC, effective Jan. 2.

This means Platts CEC continues to reflect CORSIA-eligible credits, following the end of the pilot phase of the program, and its evolution to Phase 1, at the beginning of 2024.

As such, and aligned with Phase 1 CORSIA requirements, Platts CEC reflects credits with vintages 2021-26.

Furthermore, as an additional criteria of Phase 1, a Corresponding Adjustment needs to be attached to the credit, guaranteeing that the host country will not claim the credit against its climate goals, in order to avoid double counting.

As such, Platts CEC now reflects bids, offers or trades in which a seller commits to deliver a credit that will have a Corresponding Adjustment, and that will meet any other criteria necessary for eligibility under CORSIA Phase 1.

Furthermore, Platts has widened the volume represented by the Platts CEC assessment, to 20,000-100,000 mtCO2e, from 1,000-20,000 mtCO2e previously.

Bids, offers and transactions that exceed this range may be normalized for the purposes of assessment.

Until now, Platts CEC had reflected market activity for CORSIA-eligible credits during the pilot phase, but Platts had not specified any further which phase of the CORSIA program its CEC assessment covers.

Vintages reflected in the assessment had been 2016-20, as outlined by the CORSIA scheme for the pilot phase.

Platts opened a consultation Oct. 9 on how to evolve its CEC assessment in the context of the expiry of the pilot phase of the International Civil Aviation Organization (ICAO) CORSIA scheme, and the start of Phase 1.

The consultation note is available via this link: https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/100923-platts-seeks-feedback-on-capturing-shift-from-corsia-pilot-to-phase-1-within-cec-assessment

Platts subsequently decided to reflect CORSIA Phase 1 eligible credits in its CEC assessment in a note published on Nov. 28 and available via this link:

https://www.spglobal.com/commodityinsights/en/our-methodology/subscriber-notes/112823-platts-cec-price-assessment-will-reflect-phase-1-corsia-credits-from-jan-2

Under the ICAO, airlines have committed to reducing their carbon footprint through an initial voluntary period -- the pilot phase, 2021-23 -- and a subsequent mandatory reduction period -- Phase 1, 2024-26 and Phase 2, from 2027 onwards -- according to the registry and methodology limits set out here. [https://www.icao.int/environmental-protection/CORSIA/Pages/default.aspx ]

Full details on the current specifications of Platts CEC are set out in the Carbon Markets Specifications Guide available here: https://www.spglobal.com/commodityinsights/PlattsContent/_assets/_files/en/our-methodology/methodology-specifications/method_carbon_credits.pdf

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