Economic Measures – Emissions Trading and Carbon Offsetting

Emissions trading

While Cathay Pacific supports emissions trading as one of the interim solutions to reduce aviation’s emissions, we do not support the imposition of the European Union’s Emissions Trading Scheme (EU ETS) to carriers based outside of Europe for several reasons. These include distortion of the market, additional bureaucracy and cost, but most significantly, no guarantee that revenue generated from the scheme will be directed into funding much needed climate change initiatives.

We have been calling for aviation emissions to be regulated under a global sectoral scheme under the UN's ICAO (International Civil Aviation Organization) (as opposed to regional schemes such as the EU ETS) for three years now, which we believe is more appropriate for the global nature of the industry. Despite our strong opposition, we have been working in full compliance with the EU ETS regulation.

We have been working with the Aviation Global Deal (AGD) group for a global solution to emissions that meet environmental and developmental needs whilst ensuring a level playing field in our industry, in full support of ICAO.

In addition, in 2011, our Head of Environmental Affairs was appointed to IATA’s Climate Change Task Force which is leading the industry’s work to develop airlines’ commitment to carbon neutral growth for 2020 and to develop proposals for a global agreement on emissions under ICAO’s leadership.

It is inevitable that increased costs from the EU ETS will be passed on to the passengers. To an extent, this depends on carbon prices, and it is under assessment.

Carbon offsetting

FLY greener, the first carbon offset programme launched by an Asian airline in 2007, is part of our ongoing effort allowing passengers to contribute to projects that reduce CO2 emissions, and increase awareness of climate change issues. More information on this programme and the projects we offer, including our unique corporate carbon offset programme for corporate clients, can be found at Based on the carbon emissions calculated for the specified flights, the attributable monetary contributions go directly to fund third-party validated projects that help to offset the carbon dioxide generated by those flights. All of the projects we offer are certified under the Voluntary Carbon Standard (VCS) to ensure that they are verifiable, credible and make a difference to local communities and to the environment.

In 2011, 3,392 tCO2 were offset by our passengers, including several companies in Hong Kong, China, and Taiwan, representing an increase of 10% from 2010.

Cathay Pacific and Dragonair also offset the CO2 impacts of staff travelling on business, amounting to 14,575 tCO2 at an approximate cost of HK$788,000.

Current portfolio of projects supported under FLY greener:
Run-of-river hydropower project
Pearl River Delta, Guangdong
Feeds into the Southern China Power Grid
Set of 95 small run-of-river hydropower stations
Chongqing, Guizhou, Sichuan Yunnan
Links to the Southern China Power Grid for the Pearl River Delta
Set of 23 wind turbines
Font Size
  • Sustainable Development Report 2010
    [website | pdf]
  • Sustainable Development Report 2009
    [website | pdf]
  • Sustainable Development Report 2008 [pdf]
  • Sustainable Development Report 2007 [pdf]
  • Sustainable Development Report 2006 [pdf]
  • Sustainable Development Report 2005 [pdf]
  • Sustainable Development Report 2004 [pdf]
  • Sustainable Development Report 2003 [pdf]