EU MRV Regulation

MRV presentation will present the last developments at EU level in respect to the international dimension of the new EU Regulation and its adoption by the plenary of the European Parliament next week. It will look at the content and the scope of the new Regulation and will especially analyse its main pillars, i.e. the collection and publication of information on CO2 emissions, EEDI and energy performance per ship name. Subsequently, it will make a reference on the potential impact of the new rules on cargo owners’ decisions noting that according to the Third IMO GHG Study the projected increase in transport demand will offset any efficiency gains

I have been dealing with the MRV regulation since I was a policy advisor in the European parliament. But what is really MRV? MRV stands for Monitoring, Reporting and Verification of the CO2 emissions from the maritime transport.

Let me say a few words about my organisation, T  & E. T & E is a Brussels based environmental group, focus on sustainable transport, with 46 member organisations in 24 countries. We focus on climate change and air pollution and we are involved in the regulatory process at European and international level with regard to the CO2 standards, reduction targets and fuel quality. T & E also participates and actively contributes to the IMO process through MEPC and relevant correspondence groups on the implementation of the global 0.5% sulphur limit as well as on the establishment of a global MRV system and on the EEDI review.

EU MRV and its background:

The EU MRV is part of the EU strategy which was announced back in 2013 as a first step towards a reduction target and measures to implement this target. With regard to the state of play on the adoption of the EU MRV, the final vote is scheduled on Tuesday 28th April where the new EU law will be finally and officially adopted by the plenary of the European parliament next week. Worth to say that EU MRV is a regulation not a directive, which means that it doesn’t need to be transposed into  national law. It has a direct effect, entering into force on 1 July 2015 and operating from 2018. The next milestones for the implementation of the MRV are:

• Preparation of the technical rules and
• Delegated acts on verification implementing act on ‘cargo carried’ for ‘other ship types.

The main characteristic of the EU MRV regulation is transparency. The two main pillars of the new law are:

• The collection of data on the CO2 emissions and
•  The collection of data on the fuel efficiency of ships.

The main characteristics of the system are:

• Full transparency, (all the information will be published per ship name),
• flag-neutrality, (covering all ships calling at EU ports excluding small emitters and special ship types)

It focuses on CO2 (as predominant greenhouse gas emissions from ships) and fuel efficiency (expressed by six different indicators for technical and operational efficiency)

However, it’s also interesting to look at the international dimension of the EU MRV system. Firstly, as I already mentioned above, all ships calling at EU ports will be covered by the EU rules, which means probably more than 70% of the global fleet making the new EU law effectively a global measure. Secondly, the new regulation provides EU with a legal basis to speak for the first time with one voice in the IMO, especially on fuel and energy efficiency issues. As a result, all EU members states, have submitted to the next MEPC in May in London a joint paper, supporting the idea that an EU-style MRV system could be easily transferred and transposed into international law. And when it comes to the IMO process, I have to say that there is a lot of reluctance. Many observers, stakeholders and members of the organisation have expressed their unwillingness to consent to a collection of data when it comes to the fuel efficiency. Thus, it’s still quite uncertain if the global system will be mandatory or voluntary and whether it will cover also fuel efficiency.

EEDI/Operational efficiency data publicly available:

• The identity of the ship,
• The technical efficiency of the ship (EEDI or EIV, where applicable),
• The annual CO2 emissions,

• The annual total fuel consumption for voyages,

• The annual average fuel consumption and CO2 emissions per distance travelled of voyages,

• The annual average fuel consumption and CO2 emissions per distance travelled and cargo carried on voyages,

• The annual total time spent at sea.

Why this regulation is so important? Because transparency means fuel efficiency. The MRV regulation will make available for the public, for the policy makers and for the cargo owners what some voluntary initiatives already do.

You can look for example at the Clean Shipping Index and the Right ship/shippingefficiency.org ranking. They are voluntary initiatives of ship-owners and cargo owners who exchange information in the procurement process. And if you look at the Clean Shipping Index, you can find many big multinational companies from the car industry (for example VW) to the big global retailers (for example H&M), who participate and receive information about the environmental performance of the ships. Why cargo owners are so interested? Because transparency means fuel efficiency.  They pay fuel cost and are able to advertise to their consumers the greening of their supply chain.

What is coming up next? Shipping is the only transport mode and one of the few sectors of the EU economy currently not covered by the EU reduction targets. Global shipping emissions have increased by 70% since 1990. The third IMO GHG study found that the increase in shipping emissions will be up to 250% by 2050. What this study also found is that the increased transport demand will offset any efficiency gains resulting by the implementation of the EEDI targets. What we urgently need is a reduction target at European and international level. If we are interested in creating a level playing field among the different sectors of the economy, in fighting against climate change and if we are ready to listen to what science says about the level of the risk climate change poses on the environment and our economy, it’s fair to say that it’s time for the shipping sector to make its contribution and to pay its share to this fight.

Above article is an edited version of Sotiris Raptis presentation during the 2015 GREEN4SEA Forum.

You may view his presentation video by clicking here