What’s being done about shipping’s climate impact?
In April 2018, the United Nations’ global shipping body, the International Maritime Organisation (IMO), agreed a draft greenhouse gas (GHG) strategy committing the shipping sector to reducing emissions by at least 50% by 2050 compared to 2008. It envisions total shipping GHG emissions peaking as soon as possible while at the same time the sector pursues efforts to phase them out entirely. The strategy specifically calls for “a pathway of CO2 emissions reduction consistent with the Paris Agreement temperature goals”. The full text of the Initial IMO Strategy on reduction of GHG emissions from shipping can be downloaded here.
Monitoring, reporting and verification of shipping emissions
The EU regulation on monitoring, reporting and verification (MRV), agreed in 2015 and implemented in 2018, requires operators of all ships above 5,000 gross tonnes calling at EU ports to monitor and publicly report annual emissions every year. Three metrics which measure the environmental performance of ships are used: the theoretical design energy performance of the ship according to the IMO’s Energy Efficiency Design Index (EEDI); real-world fuel consumption; and real-world operational energy efficiency, which is the amount of fuel consumed divided by transport work (that is, the amount of cargo carried multiplied by distance covered). The more cargo a ship can carry using the same amount of fuel, the more efficient and cheaper it is to run. The publication of ships’ real-world operational energy efficiency will provide shipping users in Europe and worldwide with transparent data to identify the most efficient ships and practices. This can trigger a virtuous cycle of increased competition among operators and ship owners, which will drive fuel savings and emissions reductions. The MRV is intended as a stepping stone for an eventual measure to require actual emissions reductions.
Should shipping be included in the emission trading system?
In 2016, after the adoption of the MRV Regulation and the Paris Agreement, there was still no sign of global action at IMO meetings. This led the European Parliament to push for the inclusion of shipping in the EU emissions trading system (ETS) after the European Commission failed to include the sector’s emissions in their phase 4 ETS review proposal. The proposal would include EU-related shipping emissions under the ETS from 2023 if the IMO has not delivered a global deal with short-term measures to reduce emissions from shipping by then – coinciding with the end of the IMO’s seven-year GHG work plan. According to the Commission’s own 2013 impact assessment, shipping CO2 emissions could be reduced cumulatively by 80 million tonnes by 2030 – the total annual emissions of Austria – if the sector were included in the ETS.
What about air pollution from ships?
In October 2012 the European Council formally adopted the revision of the EU Directive limiting the sulphur content of fuels used by ships in EU seas. From January 2015, ships were only allowed to use fuels with a maximum of 0.1% sulphur content, down from 1.5% previously permitted in the North Sea, Baltic Sea and English Channel. They could either use cleaner fuels, which are more expensive, or install abatement technologies such as scrubbers.
Read our briefing on the issue
In parallel, ships sailing in other EU waters and the rest of the world will be allowed to use fuels with a maximum of 0.5% sulphur content from 1 January 2020 (adopted by the IMO in 2016). T&E played a significant role in securing 2020 as the effective start date of the global 0.5% sulphur content limit. T&E, through the Clean Shipping Coalition, secured a seat at the steering committee overseeing the IMO fuel availability study. The study has analysed whether or not there would be enough 0.5% sulphur content compliant fuel available in 2020 to start the new standard in 2020 or delay it to 2025. At the steering committee, T&E made sure the study was performed by a neutral consultant (CE Delft) and not the one favoured by industry, which had in the past concluded there would not be enough compliant fuel in 2020. The sulphur cap enters into force January 2020.