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Fastmarkets assessed CORSIA Phase 1 (CP1) spot prices at $18.30 per tonne of carbon dioxide equivalent (tCO2e), down from $19.00 per tCO2e the previous week, as lower offer levels, combined with fresh availability from newly eligible projects, outweighed concerns over the loss of expected supply from the Koko cookstove project in Kenya.
The latest move marks a continuation of the downward trend seen over recent weeks, with market participants increasingly reassessing clearing prices as the supply picture shifts from extreme scarcity toward gradual diversification.
One of the key developments this week was the application of the first CORSIA Phase 1 eligibility labels on the Verra registry, a step that participants said materially improved near-term supply visibility.
Verra confirmed that 4.78 million tCO2e of credits issued under the Verified Carbon Standard had been tagged as CP1-eligible. The initial batch covers four clean cooking and household energy projects led by DelAgua in Rwanda, Sierra Leone and The Gambia, making them the first Verra-issued credits available for delivery into the aviation compliance market.
The credits were issued through the insurance pathway, meaning they have a valid letter of authorization (LoA), approved insurance and a signed deed of accounting representation. Gold Standard had previously tagged eligible credits through this route toward the end of last year.
Base Carbon, which has exposure to DelAgua’s Rwanda cookstove program, said that it had sold around 300,000 tCO2e of CP1-eligible credits in recent weeks. The company added that further sales discussions and request for proposals (RFPs) were continuing.
Sources said that while a significant share of the newly tagged credits had been pre-sold to airlines and intermediaries, spot availability had emerged at levels below those seen earlier in the year, contributing to softer market sentiment.
Verra also subsequently tagged a further 400,000 tCO2e of credits eligible from a cookstove (VCS 2924) and water filtration (VCS 3204) project in Laos after the country submitted an updated Biennial Transparency Report (BTR) to the UN in January and applied corresponding adjustments to the credits. A third project was also correspondingly adjusted in the report (VCS 2521) but has not yet been tagged eligible on registry.
Further supply also came from the Guyana ART TREES (ART 102) project, with 9.09 million tCO2e of vintage 2023 credits also tagged eligible this week. The credits had previously been verified late last year before being issued, correspondingly adjusted and tagged recently.
Gold Standard also tagged a further 20,657 tCO2e of vintage 2023 credits from a Rwanda water filtration project (GS 11639) as eligible.
This brings total eligible supply to around 32 million tCO2e from 10 projects, up from around 17.5 million tCO2e in late January.
The arrival of new Verra-tagged supply came as the market digested the loss of expected Kenyan volumes following the exit of clean cooking firm Koko after the Kenyan government refused to issue a Letter of Authorization (LoA).
Fastmarkets Analytics had previously expected the project to have around 13 million tCO2e of CP1-eligible cookstove credits during Phase 1, equivalent to around 5-10% of potential supply. However, several sources said the market had already begun to discount the likelihood of those volumes materializing, after repeated delays and prolonged uncertainty around host country approvals.
Other sources also pointed to the International Civil Aviation Organization’s (ICAO) Technical Advisory Board’s (TAB) retroactive approval of Verra’s VMR0006 and AMS.II-G cookstove methodologies in the fourth quarter of last year as another mitigating factor. With the potential increase in supply from these projects outweighing the loss of Koko volumes. Around 30 million tCO2e of credits from CORSIA-aligned projects are issued unretired so far, with more than 3.8 million tCO2e already with LoAs.
Lee Kinyanjui, Kenya’s cabinet secretary for investments, trade and industry said concerns had emerged over the scale of carbon credit volumes being claimed by a single company, which could amount to all of Kenya’s exportable carbon credits during this period, describing the issue as a structural business model concern rather than a shift in government policy, on Wednesday February 4. Koko’s Kenyan entities have since been placed under administration, underlining the severity of the setback.
Sources anticipated that Koko credits would now likely be valued at voluntary market levels, with one trader estimating prices around $3-4 per tCO2e, and limited buying interest given the project’s exit and lack of LoA. Late last year, an offer for Koko credits without an LoA was reported at $5 per tCO2e.
Pricing across spot and forward markets reflected the shifting supply outlook.
In the spot market, offers for 10,000 tCO2e of vintage 2023 credits from Burn’s Tanzania cookstove project (GS 11732) were reported at $18.50 per tCO2e. Credits from the project traded at $18-20 per tCO2e in November before they were officially tagged. Offers for slightly smaller generic CP1-eligible credits were reported at similar levels.
Meanwhile, spot buying interest was reported at as high as $17 per tCO2e for 5,000 tCO2e of CP1-eligible credits, while other buyers put out tentative bids between $12.00-14.50 per tCO2e.
On Climate Impact X, best bids were seen at $17.05 per tCO2e for 2,000 tCO2e, with best offers at $18.50 per tCO2e on Friday January 30.
Further out on the curve, forward offers for 2024-26 vintages with delivery in January 2027 were heard between $16.90-17.75 per tCO2e for between 10,000-50,000 tCO2e, while indicative bids for smaller forward volumes were reported at $15 per tCO2e for December 2027 delivery.
Several participants said newly tagged Verra cookstove credits were likely to transact in the mid-to-high teens, with indicative pricing at around $15-16 per tCO2e cited. However, sources cautioned that confirmed prints remained limited and that pricing continued to vary widely by project, delivery profile and counterparty risk.
Despite the increase in eligible supply, airline demand remained measured. Market participants said compliance buying was likely to be backloaded, with larger volumes expected later in 2026 or 2027 and closer to Phase 1 deadlines, rather than immediately following the recent tagging events.
Several traders pointed to Asian and Gulf carriers as a likely next wave of demand, noting that many airlines continue to monitor price direction and supply developments before committing to larger offtakes.
While some participants said the loss of Kenyan supply could have supported prices under different circumstances, the prevailing view this week was that the market’s focus had shifted toward improving availability and lower-cost supply, resetting expectations across the CP1 price curve.
Fastmarkets quantifies this system through regular CORSIA Phase 1 spot benchmarks, demand and supply forecasts, and eligibility tracking, translating policy and registry data into the signals airlines use to manage cost exposure and compliance. Discover more.