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Business Times
11-07-2025
- Business
- Business Times
Singapore mulls introducing carbon offsetting legislation for airlines
[BANGKOK] Singapore is looking to draft a carbon offsetting legislation for the aviation sector, and is studying whether to introduce penalties for airlines if they fail to comply with its requirements. While still in the works, the new legislation is likely to take reference from an existing one that mandates airlines to report their carbon emissions, said Ng Shao Hua, senior manager of global partnerships at Singapore's National Climate Change Secretariat on Wednesday (Jul 9). That carbon reporting legislation, which came into effect in 2023, has provisions to fine airline operators for failing to make these disclosures. Ng, who was speaking at the Asia Climate Summit organised by the International Emissions Trading Association, said: 'If you were to look at how we have framed our legislation on monitoring, reporting and verification (MRV) – where there are penalties, I think we are most likely to take reference from that.' He added that no timeline has been set for the Bill to be introduced and debated in Parliament. Ng was responding to a question during a panel discussion, on whether the Singapore authorities are looking to penalise airlines for not complying with carbon offsetting requirements in the future legislation. A NEWSLETTER FOR YOU Friday, 12.30 pm ESG Insights An exclusive weekly report on the latest environmental, social and governance issues. Sign Up Sign Up The carbon reporting legislation was developed in line with an international programme to cut emissions from the aviation sector, known as the Carbon Offsetting and Reduction Scheme for International Aviation (Corsia), which has required participating airlines to report their annual emissions since 2019. Besides disclosing their emissions, airlines which have signed up to Corsia are also obligated to purchase carbon offsets if their emissions go above 85 per cent of their 2019 levels. The International Civil Aviation Organization had developed the scheme in 2016 to stabilise the sector's net emissions. Under the scheme's initial phases, airlines have until 2026 to purchase carbon offsets voluntarily. From 2027, however, it would become mandatory to do so. Singapore is looking to start work on this carbon offsetting legislation, given that airlines would soon have to start buying carbon offsets to meet Corsia requirements. This is because – even though carbon offsetting obligations began in 2021 – many airlines have not crossed the 85 per cent threshold in the last few years with the imposition of international travel curbs during the Covid-19 pandemic. They are, however, expected to cross this limit with their 2024 emission levels, said Ng. Countries such as the United Kingdom and Canada, have already introduced penalty frameworks for airlines in their legislations. Ng had said that Singapore had decided to take a step-wise approach on legislations, starting first with MRV, and then moving on to carbon offsets. MRV requirements are low-cost and not difficult for airlines to meet, even voluntarily. However, Ng noted that getting airlines to buy carbon offsets might not be as easily accomplished without legislation in place. 'We do need that demand certainty and that will come from legislation. Because if countries are ready to put their foot forward to say: 'I will legislate this. I will be prepared to fine the airlines if they're not ready to comply, even though it's a voluntary scheme until 2026' – if there's a clear direction from governments, then I think that will be the game changer,' said Ng. 'So I think what is needed is how can we push more countries to come on board,' he added.
Business Times
11-07-2025
- Business
- Business Times
Singapore aims to ink carbon credits transfer agreement with first Asean country by end-2025
[BANGKOK] Singapore is aiming to finalise carbon credit negotiations and ink its first transfer agreement with an Asean country by the end of this year, said Benedict Chia, director-general for climate change at Singapore's National Climate Change Secretariat on Wednesday (Jul 9). 'We hope that within the next few months, within this year, we will have more Asean countries being able to collaborate with Singapore. We are in advanced discussions with a number of them, including Thailand. So hopefully things can progress,' said Chia, who was speaking at a panel during the Asia Climate Summit organised by the International Emissions Trading Association. Singapore has signed memorandums of understanding (MOUs) with five Asean countries – Vietnam, Cambodia, Laos, the Philippines and most recently Malaysia – to collaborate on carbon credits. However, none of these MOUs have resulted in the signing of a carbon credits transfer agreement yet. It is only when these agreements are signed can the city-state buy carbon credits from the host countries and use them to meet its climate targets, according to Article 6 of the Paris Agreement. They set out legally binding frameworks and processes for the generation and international transfer of carbon credits. A NEWSLETTER FOR YOU Friday, 12.30 pm ESG Insights An exclusive weekly report on the latest environmental, social and governance issues. Sign Up Sign Up Thus far, Singapore has only inked carbon credit transfer agreements with seven countries – Papua New Guinea, Ghana, Bhutan, Peru, Chile, Rwanda and Paraguay. Unified system for carbon credit trading While there are no government-to-government agreements yet between Asean countries, industry players in the region are looking to advance regional cooperation on carbon markets, with the establishment of the Asean Common Carbon Framework at the end of last year. The framework aims to create a unified system for carbon credit trading in South-east Asia, and steps have been taken to finalise governance structures, discuss methodologies and formulate an implementation road map. Five carbon market associations from Indonesia, Malaysia, Singapore and Thailand are participating in this initiative. When discussing with potential host countries to collaborate on carbon credits, Chia said that Singapore focuses on three factors: projects that are aligned with the national interest of the host country; the involvement of local partners and businesses; as well as ensuring the local communities benefit.


Singapore Law Watch
11-07-2025
- Business
- Singapore Law Watch
Singapore mulls introducing carbon offsetting legislation for airlines
Singapore mulls introducing carbon offsetting legislation for airlines Source: Business Times Article Date: 11 Jul 2025 Author: Janice Lim No time frame has been set yet for the draft law, but it will take a leaf from an existing legislation that mandates carbon emissions reporting. Singapore is looking to draft a carbon offsetting legislation for the aviation sector, and is studying whether to introduce penalties for airlines if they fail to comply with its requirements. While still in the works, the new legislation is likely to take reference from an existing one that mandates airlines to report their carbon emissions, said Ng Shao Hua, senior manager of global partnerships at Singapore's National Climate Change Secretariat on Wednesday (Jul 9). That carbon reporting legislation, which came into effect in 2023, has provisions to fine airline operators for failing to make these disclosures. Ng, who was speaking at the Asia Climate Summit organised by the International Emissions Trading Association, said: 'If you were to look at how we have framed our legislation on monitoring, reporting and verification (MRV) – where there are penalties, I think we are most likely to take reference from that.' He added that no timeline has been set for the Bill to be introduced and debated in Parliament. Ng was responding to a question during a panel discussion, on whether the Singapore authorities are looking to penalise airlines for not complying with carbon offsetting requirements in the future legislation. The carbon reporting legislation was developed in line with an international programme to cut emissions from the aviation sector, known as the Carbon Offsetting and Reduction Scheme for International Aviation (Corsia), which has required participating airlines to report their annual emissions since 2019. Besides disclosing their emissions, airlines which have signed up to Corsia are also obligated to purchase carbon offsets if their emissions go above 85 per cent of their 2019 levels. The International Civil Aviation Organization had developed the scheme in 2016 to stabilise the sector's net emissions. Under the scheme's initial phases, airlines have until 2026 to purchase carbon offsets voluntarily. From 2027, however, it would become mandatory to do so. Singapore is looking to start work on this carbon offsetting legislation, given that airlines would soon have to start buying carbon offsets to meet Corsia requirements. This is because – even though carbon offsetting obligations began in 2021 – many airlines have not crossed the 85 per cent threshold in the last few years with the imposition of international travel curbs during the Covid-19 pandemic. They are, however, expected to cross this limit with their 2024 emission levels, said Ng. Countries such as the United Kingdom and Canada, have already introduced penalty frameworks for airlines in their legislations. Ng had said that Singapore had decided to take a step-wise approach on legislations, starting first with MRV, and then moving on to carbon offsets. MRV requirements are low-cost and not difficult for airlines to meet, even voluntarily. However, Ng noted that getting airlines to buy carbon offsets might not be as easily accomplished without legislation in place. 'We do need that demand certainty and that will come from legislation. Because if countries are ready to put their foot forward to say: 'I will legislate this. I will be prepared to fine the airlines if they're not ready to comply, even though it's a voluntary scheme until 2026' – if there's a clear direction from governments, then I think that will be the game changer,' said Ng. 'So I think what is needed is how can we push more countries to come on board,' he added. Source: The Business Times © SPH Media Limited. Permission required for reproduction. Print