BPT becomes world's first to sell pipeline carbon credits to airlines

BAFS Pipeline Transportation Limited (BPT) has become the world's first leader in aviation carbon credits by shifting its transport mode (Methodology: Mode Shift) from trucks to a fuel pipeline system.

These credits will be used in the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) of the International Civil Aviation Organisation (ICAO), which requires airlines to offset greenhouse gas emissions exceeding the baseline year.

"Northern pipeline" as a transport mode shift model

ML Nathasit Diskul, President of Bangkok Aviation Fuel Services Public Company Limited (BAFS), said the pipeline project originated from past issues when the aviation fuel depot at Don Mueang Airport lacked a pipeline receiving system, requiring the use of numerous fuel trucks.

This resulted in heavy traffic congestion, especially during festivals such as Songkran, when queues of fuel trucks could stretch as far as Din Daeng.

The government at the time, therefore, considered investing in a pipeline transport system similar to those in developed countries, assigning BAFS as the core leader.

Initially, the project was designed exclusively to transport Jet A-1 fuel, but studies revealed it was not commercially viable.

The scope was then expanded to include ground transport fuels, both diesel and petrol, by routing to Bang Pa-in.

Later, during Gen Prayut Chan-o-cha's government, there was a policy to expand fuel pipelines to the regions.

The North was selected as a strategic route due to its high demand for diesel in the agricultural sector, which could compete with truck transport.

BPT's Northern fuel pipeline project was therefore developed to upgrade the country's energy infrastructure, enhance fuel distribution security, reduce reliance on truck transport, and support economic growth in the North.

It provides a multi-product pipeline transport service, the first of its kind in Thailand, controlled by a computer system.

The system receives fuel and transports it through the pipeline network to various depots, sending aviation fuel (Jet A-1) to Don Mueang and Suvarnabhumi depots, and ground vehicle fuel to the Bang Pa-in depot.

The first project, transporting fuel via pipeline to the North, Phase 1, runs from Bang Pa-in to Phichit, covering a distance of 367 kilometres.

Subsequently, Phase 2 of the Northern pipeline project covers the Kamphaeng Phet to Lampang section, a distance of 209 kilometres.

The company is currently investing in the Phase 3 extension project from Ang Thong to Saraburi, which is expected to be completed in late 2026 and commence commercial operations in early 2027.

This will connect the pipeline from eastern refineries to the North, expected to increase fuel transport volume by a further 1.2 billion litres per year and generate additional carbon credits in the future.

Currently, BPT has accumulated approximately 144,000 tonnes of carbon credits from the Northern pipeline project (the actual volume of greenhouse gas reduction accumulated to date).

The most outstanding feature of this project is its "environmental dimension."

BPT found that switching the fuel transport mode from trucks to a pipeline system can significantly reduce greenhouse gas emissions.

The pipeline system uses electricity for propulsion, which saves more energy than diesel-powered trucks by more than half during certain periods.

Furthermore, it helps reduce evaporation loss, which typically accounts for at least 1% during truck transport.

This lowers depot management costs for oil company clients, eases traffic congestion, and reduces accident risks from frequent fuel truck rollovers, allowing the project to generate economic, social, and environmental benefits simultaneously.

Carbon credit collection certified by global standards

Initially, the carbon credit collection from BPT's mode shift was viewed as a benefit to make the investment more worthwhile, as it could be calculated in terms of pollution reduction.

The company began studying carbon collection when no agency in Thailand certified the methodology for collecting carbon credits from this process.

They therefore looked abroad, opting for the Verified Carbon Standard (VCS) by Verra, which is one of the most widely recognised carbon credit standards globally.

Despite having higher operating costs than the domestic T-VER standard, BPT needed internationally recognised credits because its main clients are international airlines.

This aligns with ICAO requirements and has become even more important recently, as ICAO has approved its use in CORSIA.

World's first aviation carbon credits from pipeline transport

This project creates a significant "first" in multiple dimensions, both nationally and globally:

• First in the world: The project received carbon credit certification using the transport mode shift methodology, transitioning from trucks to a fuel pipeline system, for use in ICAO's CORSIA, which has never been done anywhere in the world.
• First sale of carbon credits generated in Thailand via transport mode shift to offset greenhouse gas emissions in the international aviation industry's CORSIA scheme.
• First in Thailand (government process): This is the first project operating under Thailand's new process, receiving a Letter of Authorisation (LOA) from the Department of Climate Change and Environment. This facilitates faster approval for overseas credit sales without requiring a cabinet resolution as in the past, and ensures the credits will not be double-counted against the country's greenhouse gas reduction targets.
• First for the company: This year will be the first year BPT officially begins selling carbon credits certified under international standards (VCS) to both domestic and international airlines.

Carbon offsetting trend to play a bigger role in 2027

The global carbon credit market trend in the international aviation business is shifting from "Voluntary" to "Mandatory", particularly in 2027 when the CORSIA mechanism enters its mandatory phase, which will drive carbon credit prices significantly higher.

As airlines worldwide will compete for limited credits, the expansion of CORSIA will significantly increase the demand for high-quality, internationally recognised carbon credits.

In addition, with Net Zero becoming a global agenda, numerous organisations have set Net Zero targets.

There is a demand for high-quality carbon credits to help offset unavoidable carbon emissions, and the market is shifting from purchasing cheap credits to selecting credible, verifiable credits that deliver actual greenhouse gas reduction results.

BPT's Northern fuel pipeline project is therefore not merely an energy transport route, but a "pipeline of sustainability" linking global environmental responsibility with the strength of Thai business.