EU plans shipping emissions cap

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The Commission has said that it will draft legislation, by the end of the year, aimed at tackling the shipping industry’s rapidly growing contribution to climate change, by including the sector in Europe’s carbon dioxide cap-and-trade system.

The Commission confirmed on 16 April 2007 that it will propose adding shipping companies to the emissions trading scheme (ETS), the EU’s principal tool for fighting global warming and meeting its Kyoto commitments. 

Up to now, work on reducing CO2 emissions from ships has been carried out within the framework of the International Maritime Organisation (IMO), but it has focused mainly on establishing methods to calculate emissions, rather than concrete measures to reduce them. 

The threat of unilateral action from the EU, which controls 41% of the world’s fleet, could stimulate the debate. 

But there is also a risk it could trigger a transatlantic dispute similar to that caused by draft EU rules, published late last year, to impose emissions trading on all airlines flying to and from European airports as of 2012. The US has threatened legal action if the EU goes ahead with these plans. 

Barbara Helfferich, environment spokeswoman for the Commission, told ENDS Europe Daily that a decision on how to tackle shipping emissions would "probably be taken after the summer". But, Jos Delbeke, the Commission official in charge of the EU's ETS, told the Financial Times: "By the end of the year we are going to come forward with a proposal to extend the emissions trading scheme to shipping." 

European Community Shipowners' Association (ECSA) Secretary General Alfons Guinier stressed that, while shipping may be the transport mode with the largest CO2 emissions in terms of sheer volume, this was down to the fact that ships carry 90% of world trade. "In reality, shipping produces less greenhouse gases per tonne-mile than any other form of transport," he said. 

He nevertheless told EURACTIV that the shipping industry was "not against" a proposal to include it in the ETS "depending on the practicalities". Among others, European shipowners are worried that they will be the only ones carrying the extra cost of cutting CO2 emissions while foreign transporters continue to pollute freely. 

He added that work was already being carried out within the IMO to reduce other forms of pollutants, such as sulphur emissions, through setting international standards, but added that much of the work will have to be carried out by oil companies. "We can only burn what we have," he said. 

He rejected the idea of introducing taxes to tackle the sector's emissions and warned that work on reducing all types of pollutants must be carried out in an integrated manner, because reducing one type of emission can result in increasing another. 

Chairman of the International Chamber of Shipping (ICS) Spyros Polemis confirmed: "IMO should carefully review the environmental necessity of banning the use of higher sulphur fuels in the middle of the ocean, when the results of decisions could be to increase CO2 emission by oil refineries," he said, explaining that more CO2 is churned out during the energy-intensive refining process. 

João Vieira of the green NGO T&E (European Federation for Transport and Environment) said: "We welcome the fact that the EU is finally waking up to the environmental impact of shipping, the second-fastest growing source of climate-changing CO2 emissions. So far, the international community has manifestly failed in its responsibility to clean up shipping in the decade since Kyoto was signed." 

But, he added that emissions trading alone would be insufficient to address the full environmental impact of the sector. "The EU's estimates for aviation suggest that emissions reductions through trading will be offset by less than one year's growth of the industry. With shipping the situation will be similar. We urge the EU to consider other, more effective measures such as differentiated port charges, en-route charges and fuel taxes," he said. 

Carbon dioxide emissions from shipping are thought to be double those of aviation and could rise by as much as 75% in the next 15 to 20 years if world trade continues to grow and no action is taken. 

While aviation has come under heavy pressure to cap its CO2 output in order to contribute to the battle against climate change (see our LinksDossier on Aviation and Emissions Trading), shipping has thus far been spared any significant cuts as CO2 emissions from ships do not come under the Kyoto Agreement or any proposed European legislation. 

But pressure is mounting on all sides for the situation to change. 

As well as carbon dioxide, shipping is a major source of other air pollutants, including nitrogen (NOx) and sulphur oxides (SOx), which are responsible for acid rain. 

  • 16-20 April 2007: Meeting of the International Maritime Organisation (IMO) in London to review international standards on emissions from ship engines.

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