The European Parliament’s Environment Committee decided to call for the inclusion of maritime transport into the EU Emissions Trading Scheme (ETS) by adopting on Thursday 15th December 2016 its report on the revision of the scheme. MEPs agreed on a compromise text for shipping, which puts pressure on IMO to have a system comparable to ETS operating for global shipping as from 2021 or else shipping will be then included in the EU ETS as from 2023. First reactions have slammed the decision; many industry stakeholders have expressed their concerns that the split threatens shipping.
The European Parliament has voted in favor of including shipping industry in the EU Emissions Trading Scheme (ETS) despite the advice of the European Parliament’s Industry Committee, which voted to keep shipping out, only a month ago.
The Danish Shipowners’ Association regrets that MEPs chose regionalism over global progress. With a split European Parliament, the EU Member States will have a key role in securing that maritime transport is not included in the final legislation, expected to be adopted by the second quarter of 2017, the Danish Shipowner’s further explained. 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 EU Affairs for the Danish Shipowners’ Association.
If IMO does not deliver a global deal by 2021, shipping industry will then be included in the European ETS as from 2023. 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.
The IMO roadmap has a two-staged approach, with an initial strategy to be decided in 2018, and a final plan to be adopted in 2023, taking into account real emission data that will start to be collected as of 2019. The IMO plan is entirely consistent with the Paris Climate Agreement of 2015. It is a logical follow-up to technical and operational measures taken earlier such as the Energy Efficiency Design Index (EEDI) and Ship Energy Efficiency Management Plan (SEEMP) adopted in 2011 to ensure that ships will be more CO2 efficient in the future, ECSA explained.
“The report ignores and undermines the roadmap that was agreed at IMO end of October. We find this very disappointing, but it does not change our resolve to make the IMO roadmap a success. We agree that the shipping sector must further reduce its CO2 emissions with a comparable level of ambition as the rest of the world economy to contribute its fair and proportionate share in meeting the Paris’ climate target. But this can only happen effectively in a global context. Threatening with regional measures under unrealistic deadlines is a very counterproductive move.”said ECSA Secretary General Patrick Verhoeven
The ENVI report needs to be confirmed in a plenary vote in the beginning of next year. Negotiations will then start with Member States and the Commission.
“We hope the unhelpful position of the ENVI Committee can be overturned in this process. The EU should engage in the global dialogue, not undermine it.”, Mr Verhoeven added.
ICS says that emissions trading, which has been developed primarily for industries such as power generation and cement and steel production, is completely inappropriate for international shipping which mostly comprises SMEs typically operating less than 10 ships.
On the other hand, Transport & Environment has said that the vote to include shipping into ETS is ”fair and will help ensure ships do not undermine climate action in other industries”.
“When the choices were between sailing towards oblivion or having ships and planes account for at least some of their climate impact, environment committee MEPs chose the latter. It also sends a clear message to the global aviation and shipping bodies that the time for weak or no action has long gone. Why should we let ships and planes do nothing while we regulate every other industry’s emissions?”Faig Abbasov, shipping and aviation officer at T&E, said.
The Parliament plenary will vote on its position next year. Negotiations between Parliament and national governments will then begin, with the aim of reaching an agreement on reform of the ETS by the end of 2017.
“With much uncertainty hanging over ICAO and IMO, the European Parliament has acted decisively to ensure these sectors will be subject to effective climate measures. Council should now follow the Parliament’s lead, and ensure climate ambition is not entirely outsourced to two agencies with long records of inaction,” Abasov said.