The European Commission put forward a series of proposals to rein in shipping emissions as part of the “Fit for 55” legislative package. However, these proposals must be urgently strengthened if Europe is to achieve zero-emission shipping, write leaders from the Getting to Zero Coalition.
The Getting to Zero Coalition is a partnership between the Global Maritime Forum and the World Economic Forum, aimed at accelerating the rollout of deep-sea zero emission vessels powered by zero emission fuels. More than 150 companies have joined the coalition.
*The full list of authors is at the bottom.
Companies from across the maritime value chain are looking towards the EU as a global climate leader – and have high hopes that the EU Fit for 55 package, to be finalised over the next few months, will be able to drive shipping decarbonisation in Europe and globally.
However, when taking a closer look at the proposals to reduce greenhouse gas (GHG) emissions from shipping, urgent improvements are needed to reach the EU’s ambition of at least 55% carbon reductions by 2030 and climate neutrality by 2050.
Shipping is an essential part of the global and European economy. Although maritime shipping has a lower level of GHG emissions intensity relative to other modes of transportation, its importance to every part of the global economy means that shipping accounts for around three percent of global emissions – of which 18% are caused by ships calling at EEA ports.
We and many other companies and organisations across the maritime value chain are committed to fully decarbonise international shipping by 2050 in line with the Paris Agreement.
But we cannot achieve zero-emission shipping without ambitious policy action, especially regulation that puts a sufficient price on carbon and supports investments in the use and production of zero-emission fuels as well as energy efficiency measures.
The good news is that we know what needs to happen and we are ready to work with policymakers to turn this vision into reality.
Global regulation through the International Maritime Organization (IMO) is the most effective solution to decarbonising a truly global sector.
Despite progress at the IMO, it is not delivering regulation at the speed required. This creates an urgent need for the EU to show leadership and take action to accelerate decarbonisation both in Europe and globally.
We are thus calling on the EU to make sure that ’Fit for 55’ is designed to achieve zero-emission shipping by 2050. To do this, three critical elements need to be in place:
Firstly, EU policymakers must set a clear target for zero-emission shipping by 2050, in line with the Paris Agreement, and make sure that new policy measures and interim targets work towards achieving this objective.
As the EU member states already support full decarbonisation of international shipping by 2050 in the IMO, setting this target at home would also strengthen the EU’s position globally and drive progress towards global regulation.
Secondly, EU policymakers should set a target of at least five percent scalable zero-emission fuels (SZEFs) used in shipping activities covered by EU regulation by 2030.
Hydrogen-derived fuels from net-zero emission sources have the biggest long-term potential for scale and should be a priority within the future fuel mix, which also needs to be backed by strong standards that ensure full lifecycle climate benefits.
Getting to five percent SZEFs will begin to drive down costs and – in combination with a high price on carbon – help make the ensuing rapid scale-up and uptake of SZEFs commercially viable by 2030, thus making the 2050 energy transition end date within reach.
Thirdly, EU policymakers should use EU ETS revenue from shipping to invest in SZEFs, zero-emission vessels and the required infrastructure. Currently, there is a very large price gap between SZEFs and fossil fuels, which will remain even after including shipping in the EU ETS – thus preventing the production and commercial viability of cleaner alternative fuels.
However, the EU could earmark part of the total ETS revenue from shipping emissions of around €5 billion annually to bridge the cost gap in the production and uptake of five percent SZEFs by 2030, as well as facilitate capital investments in zero-emission vessels and fuel infrastructure.
With these critical steps, the EU will send a clear signal to all stakeholders in the maritime ecosystem – including shipping companies, energy companies, technology providers, cargo owners, investors, and ports – that full shipping decarbonisation is a challenge we can win.
This could help unlock massive investments and job opportunities in Europe and globally, as well as contribute to making the EU the leading global supplier of zero-emission shipping and fuel production technology.
The EU has a unique opportunity to catalyse the decarbonisation of international shipping. To fully seize this opportunity, EU policymakers should ensure that the ‘Fit for 55’ package is also fit for clean and zero-emission shipping by setting ambitious targets for 2030 and 2050 and stimulating the production and uptake of the technologies and the SZEFs that the sector needs.
If this is done, the EU can truly lead the way toward zero-emission shipping and position itself and European companies as leaders in the sustainable deployment of green hydrogen in the future.
This op-ed is signed by:
Hugo De Stoop, CEO, Euronav
Christian M. Ingerslev, CEO, Maersk Tankers
Poul Skjærbæk, head of innovation and products, Siemens Gamesa
Lasse Kristoffersen, CEO, Torvald Klaveness
Rasmus Bach Nielsen, global head of fuel decarbonisation, Trafigura
Murali Srinivasan, SVP Commercial, Yara Clean Ammonia
Dagmar Droogsma, AVP, European strategy & engagement, Environmental Defense Fund Europe
Kasper Søgaard, managing director, head of institutional strategy and development, Global Maritime Forum