DSA: Split European Parliament decision puts shipping industry in jeopardy
The European Parliament’s Environment Committee yesterday decided to call for the inclusion of maritime transport into the EU Emissions Trading Scheme (ETS). The vote went against 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, Danish Shipowners Association said on Thursday.
Shipping should be included in the EU Emissions Trading Scheme (ETS) by 2023, should no global agreement operate under the IMO already from 2021 according to the European Parliament’s Environment Committee. This was the position adopted today in a vote, which saw the Environment MEPs take the opposite view from the Industry Committee, leaving Rapporteur Ian Duncan (ECR, UK) with a difficult mandate in the upcoming negotiations with the Council and the Commission.
The deadlines included in the vote show lack of understanding of the international climate roadmap warns MEP Bendt Bendtsen from the Christian-Democratic group, EPP.
“By calling for an ETS for shipping in case no international system operates by 2021, my colleagues have unfortunately chosen to cave in to regionalism and ignore the long-term impact for European growth and the environment. With only a small part of global shipping touching EU ports, ETS will miss the intended climate target and runs the risk of derailing the IMO process.”, says Bendt Bendtsen (EPP, DK), Member of the Industry Committee.
“I can only say that the Industry Committee stands firmly behind its call for shipping to be addressed internationally, otherwise it may well lead to cargo being transshipped outside of Europe with direct impacts on European employment. I will personally follow the regulatory developments at regional and international level very closely” he added.
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 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.
Background – shipping and the EU’s ETS
Set up in 2005, the European Emissions Trading Scheme (ETS) works by putting a limit on overall emissions from covered installations, which is reduced each year. Within this limit, companies can buy and sell emission allowances. ETS has since its inception suffered heavy criticism and the EU therefore launched in 2015 a legislative Proposal to enhance cost-effective emission reductions and low-carbon investments.
Because shipping is by nature a global and highly mobile industry, the European Commission decided that it would not include shipping in ETS. This was recently mirrored at international level in the UN’s International Maritime Organisation, IMO, where a mandatory data collection system and a clear deadline for a maritime CO2 strategy were adopted in October 2016. The IMO roadmap foresees the adoption of an initial strategy in 2018 to be followed by a final agreement on targets and measures, including an implementation plan, in 2023, which is fully consistent with the Paris Agreement.
The Danish Shipowners' Association is a trade- and employer organisation for more than 40 shipowners and two offshore companies. Half of the Associations' members own ships registered in Denmark, the other half run their activities in Denmark but their ships are run under other flags of state. All together, the members of the Danish Shipowners' Association own around DWT 14 million, which add up to more than 95 per cent of the Danish merchant fleet registered in the Danish International Shipregister (DIS).