E.U. Decision Seen as Caving in to Regionalism

The European Parliament’s Environment Committee’s decision to call for the inclusion of maritime transport into the E.U. Emissions Trading Scheme (ETS) has been criticized by key shipping industry associations. 

The vote to include shipping went against the advice of the European Parliament’s Industry Committee, which voted to keep shipping out, only a month ago. 

The Environment Committee agreed that shipping should be included in the E.U. Emissions Trading Scheme (ETS) by 2023, should no global agreement operate under the IMO already from 2021.

Set up in 2005, the ETS works by putting a limit on overall emissions from covered installations, which is reduced each year. Within this limit, companies can buy and sell emission allowances. ETS has since its inception suffered heavy criticism and the E.U. therefore launched in 2015 a legislative proposal to enhance cost-effective emission reductions and low-carbon investments. 

Part of the revenues generated from ETS will be channeled through a Maritime Climate Fund to improve energy efficiency and invest in innovative technologies for ports and short sea shipping.
 
Because shipping is by nature a global and highly mobile industry, the European Commission decided that it would not include shipping in ETS. This was recently mirrored at international level in the IMO, where a mandatory data collection system and a clear deadline for a maritime CO2 strategy were adopted in October 2016. The IMO roadmap foresees the adoption of an initial strategy in 2018 to be followed by a final agreement on targets and measures, including an implementation plan, in 2023, which it says is fully consistent with the Paris Agreement.

The Danish Shipowners’ Association regrets that MEPs chose regionalism over global progress. “By calling for an ETS for shipping in case no international system operates by 2021, my colleagues have unfortunately chosen to cave in to regionalism and ignore the long-term impact for European growth and the environment,” said Bendt Bendtsen (EPP, DK), Member of the Industry Committee. “With only a small part of global shipping touching E.U. ports, ETS will miss the intended climate target and runs the risk of derailing the IMO process.

“I can only say that the Industry Committee stands firmly behind its call for shipping to be addressed internationally, otherwise it may well lead to cargo being transshipped outside of Europe with direct impacts on European employment,” he added.
  
The European Parliament’s call for inclusion in ETS comes at a pivotal time where Danish shipowners have agreed to reduce emissions in pace with the rest of the world to reach the goals of the Paris Agreement. This will mean that shipping – as the rest of the economy – needs to become CO2 neutral by the second half of this century.
 
“The vote would have been a perfect opportunity for MEPs to show support for the international progress and hold IMO accountable to its timeline. Instead we end up in a confrontation with the international negotiations in IMO, which neither serves the climate nor the sector. Danish Shipowners will nonetheless maintain an ambitious climate policy and work for continued progress in IMO,” says Simon C. Bergulf, Director E.U. Affairs for the Danish Shipowners’ Association. [...]

MARITIME EXECUTIVE

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