Aviation and shipping set to face differing fortunes under EU Green Deal

Aviation and shipping are in for changes. [Photo: Shutterstock]

While planes, trains, and automobiles can expect particular attention under the EU’s upcoming Green Deal, the new Commission has already set its sights on cleaning up the transport industry – the only sector of the European economy where emissions are still growing.

Road transport dwarfs other mobility options in terms of greenhouse gas output. The European Environment Agency calculated that in 2016, the EU’s roadways contributed 72.1% of transport’s overall emissions.

Legislation on CO2 limits for cars, trucks and buses brokered under Jean-Claude Juncker’s Commission kick in early next decade, while other measures on clean vehicles, alternative fuel infrastructure and battery production are also set to move up a gear.

EU climate laws completed as truck rules get green light

European Union negotiators hauled the first ever set of rules for heavy vehicle CO2 emissions across the line early on Tuesday morning (19 February), rounding off the current generation of climate laws.

Those rules are not without their critics or shortcomings, however. At a EURACTIV event on greening mobility, the European Commission’s Herald Ruijters said that some pieces of legislation will not be adopted in time by the member states.

“The European Commission is putting forward clear proposals that are not then reaching the levels of commitment in co-decision that we would like,” added Ruijters, who is head of investment in innovative and sustainable transport.

That hasn’t stopped EU countries from getting started, with many deciding to take differing courses of action in order to hit energy and climate targets.

Nine countries, for example, have changed their standard petrol grade from E5 to E10, which means that it can contain up to a maximum 10% ethanol. Industry groups say it reduces carbon emissions and is compatible with most car models.

Other member states are betting big on electrification. German Chancellor Angela Merkel has pledged to ensure the Bundesrepublik has at least 1 million charging points by 2030, while established carmakers have started to switch production lines to electric vehicles.

Merkel aims to supercharge Germany’s electric car revolution

German Chancellor Angela Merkel said on Sunday (3 November) that Germany should install 1 million electric car charging points by 2030, ahead of crunch talks with the Bundesrepublik’s car industry later on Monday.

According to a new study by Bloomberg New Energy Finance, electrification efforts will become cheaper still by 2023, when the cost per kilowatt hour is predicted to drop to $100. That price brings it within range of conventional powertrains.

“Electric mobility is important but the entire chain has to be sustainable, using clean renewable power. Electric cars will be part of the solution, for small cars and city cars but keep in mind all the infrastructure that we need,” said Giacomo Rispoli of Italian energy firm Eni.

Green Deal ahoy

But international aviation and shipping remain sore points for policymakers. Although their shares of EU transport emissions are similar, at 13.3% and 13.6%, both figures are increasing and expected to increase year-on-year.

Under the draft Green Deal, obtained by EURACTIV, one of the main proposals is including international shipping in the Emissions Trading Scheme (ETS). That idea was already confirmed during the European Parliament hearing of Transport Commissioner Adina-Ioana Vălean.

When asked about whether the idea holds water, Ruijters replied that “Commissioner Vălean was very clear in her hearing on maritime in the ETS. But she also pointed out that the sector is in the international domain and we have to be very careful with what we do.”

Time to steer shipping into the EU carbon market

The UN shipping body’s failure to agree on immediate climate measures means the incoming European Commission President, Ursula von der Leyen, must make good of her promise to include the maritime sector under the EU Emissions Trading System (EU ETS), aruges Sam Van den plas.

“There is the issue of carbon leakage to address, we could find ourselves in a position where bunkering [of fuel] is set up on the other side of the Mediterranean or in other future third party countries,” he added, referring to the United Kingdom if Brexit happens.

“The ETS is something we will certainly do but it is not enough. Other solutions are needed to eliminate maritime’s dependency on carbon fuels. If LNG is made available, we need to ensure investments let us go for bio-LNG.”

German MEP Jutta Paulus told Danish media that the Parliament is already working on preparing the ground and that maritime could find itself included under the carbon trading system as early as next year.

Laura Buffet, from green NGO Transport & Environment, told the same event that shipping must be included in the ETS, “because international measures are failing”.

The International Maritime Organisation regulates the sector and Vălean has been tasked by von der Leyen with leading the EU’s talks at the UN body. Shipping industry heads have tried to steer the debate away from carbon pricing to taxation though.

Carbon levy should fund cleaner shipping fuels, say top executives

Executives at some of the world’s top shipping groups are advocating a levy on carbon emissions on shipping in an effort to shape tightening rules on greenhouse gas emissions while providing a means to fund development of cleaner fuel sources.

New rules on using low sulphur fuel come into play in January but a pledge by the IMO to decarbonise significantly the sector by 2050 still lacks any real roadmap.

Take-off time

The ETS is set to make less of an impact on other areas. Although the Green Deal draft says that the Commission will “assess the possibility” of including road transport in the carbon market, the idea is not likely to fly.

“We have to make a distinction between aviation, shipping and road transport when it comes to the ETS, because we know the carbon price is not going to be enough to make a difference in road transport,” Buffet explained.

Including the road sector in the ETS is also expected to affect poorer people the hardest, which makes it a difficult political sell. And T&E argues it would not be very effective in cutting emissions anyway.

Vălean was cagey on what measures will be looked at when it comes to aviation and the Green Deal only mentions reducing the number of free carbon permit allowances granted to aviation.

Intra-EU flights are already included in the ETS and the prospect of rolling it out to international journeys currently looks unlikely, given the EU’s commitment to the UN’s emissions offsetting scheme, CORSIA.

UN agency vote complicates EU’s aviation emission efforts

The International Civil Aviation Organisation (ICAO), a United Nations agency, decided on Friday (4 October) to press ahead with plans to make its emissions offsetting scheme the only global option available to its 193 member states, teeing up a dilemma regarding the EU’s own system.

The upcoming environmental package also stops short of mentioning a fuel tax, although on Thursday (5 December), EU finance ministers are expected to agree on their priorities for updating the Energy Taxation Directive.

Nine member states urged the Commission in November to price aviation more in line with the bloc’s climate obligations under the Paris Agreement and some have threatened to start taxing fuel bilaterally if no EU-level measures are put in place.

Nine EU countries urge new Commission to tax aviation more

A coalition made up of Belgium, Bulgaria, Denmark, France, Germany, Italy, Luxembourg, the Netherlands and Sweden urged the next European Commission on Thursday (7 November) to propose new measures on aviation pricing.

Other solutions to aviation’s carbon footprint are in the works. Given that electric power is currently seen as too immature, Eni’s Giacomo Rispoli said that “Biofuels can be a real option, because planes need high energy-density from its fuels. It can only come from a liquid fuel.”

Norway will in January start requiring jet fuel suppliers to blend at least 0.5% biofuels into the kerosene mix. Scandinavian airline SAS estimates it will cost €3 million extra per year but with obligatory demand, prices will be expected to decrease.

[Edited by Frédéric Simon]

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