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Global No.2 aircraft lessor SMBC to offer airlines carbon credits

·1-min read
Illustration shows SMBC Aviation Captial logo

DUBLIN (Reuters) - Aircraft lessor SMBC Aviation Capital said on Tuesday it will start offering its airline customers carbon credits aligned to the United Nations' Sustainable Development Goal in leasing contracts.

Chief Executive Peter Barrett said that in a "hard to abate sector", carbon offsetting was an interim measure to lower its impact on greenhouse gas emissions.

The world's second largest aircraft leasing firm owns, manages or has commitments to buy a total of 730 aircraft.

Owned by a consortium including Japan's Sumitomo Corp and Sumitomo Mitsui Financial Group, Irish-headquartered SMBC will initially invest $53.3 million in carbon credits based on energy efficient cookstove projects.

SMBC said in a statement that the scheme, which is certified by Gold Standard and Verra, will reach 3.2 million households in Africa, Asia and the Americas.

The airline sector, and the leasing firms who now control more than half the world's fleet of the aircraft they use, have limited options in the short term to reduce their carbon footprint, with most efforts focused on offsets, more fuel efficient aircraft and sustainable aviation fuel.

Rival leasing giant Avolon said last year it was investing up to $2 billion in electric Vertical Take-Off and Landing aircraft being developed by Britain's Vertical Aerospace.

(Writing by Conor Humphries; Editing by Alexander Smith)