The international shipping association BIMCO is the latest
member of the maritime community to express concerns over the decision to
include the shipping industry in the EU Emissions Trading System (ETS). BIMCO
in written statement said that the move will “inhibit global action on reducing
CO2 emissions.”
In September, the European Parliament moved to include the
greenhouse gas (GHG) emissions from ships over 5,000 gross tons in the
emissions trading system (ETS) starting in 2022. It is part of the EU's effort
to cut ships' annual average CO2 emissions by more than 40 percent by 2030. The
move to include shipping in the CO2 cap-and-trade system that covers other
European industries has been broadly criticized by a broad range of
organizations across the shipping industry.
“If the EU implements a regional ETS, shipping risks getting
hit by multiple emission trading systems which will make a global MBM (Market
Based Measure) much more difficult to achieve,” says David Loosley, BIMCO
Secretary General.
Instead, BIMCO urges the EU to work with the international
community at the International Maritime Organization (IMO) to get a global
market-based measure established, when the required technology is available,
which would ensure the industry operates on a level playing field.
The shipping organization believes that a regional imposed
solution such as the ETS could lead to stiff opposition and competing responses
from other large counties. As an example, BIMCO pointed to the EU’s attempt to
unilaterally enforce its ETS on airlines flying in or out of the EU in 2012.
BIMCO highlighted the stiff opposition from large countries, such as China,
India, and the U.S., to the 2012 initiative. “Given the international political
climate in 2020, I see it as much more likely today that the EU ETS will be met
with retaliation from its international trading partners over such a move,”
Loosley says.
Further, BIMCO highlights data that show that the efforts of
regional flights were a failure because they failed to create proper
incentives. A study by the ECSA and ICS concluded that the inclusion of
regional flights had contributed to a 26 percent rise in emissions from the
aviation sector since 2012. Similarly, BIMCO believes that a regional,
market-based measure would fail to incentivize shipowners to invest in
carbon-reducing technologies.
“When you build a ship, you don’t know how often it will
call at EU ports during its 25-year lifetime. That makes it impossible to
calculate when an investment in carbon-reducing technology will have paid off.
The consequence is that a regional ETS will not change how ships are built, it
will just be a tax that ultimately ends up with the consumers,” says Loosley.
Finally, similar to many other organizations in the maritime
world, BIMCO believes the EU initiative could also “negatively affect the good
faith between IMO member-states,” decreasing the likelihood of a global measure
which would have a much stronger effect.
“When there are viable technology solutions commercially
available to reduce carbon emissions, BIMCO will fully consider market-based
measures to drive the uptake of such technologies,” Loosley says. “In the
meantime, BIMCO advocates for an International Maritime Research Fund to drive
innovation, paid for by a mandatory contribution on fuel used by ships, into
technology the industry needs to cut carbon emissions by 50 percent in 2050 and
ultimately eliminate those emissions.”