With about 90% of world trade transported by sea, global shipping accounted for nearly 3% of global anthropogenic GHG emissions, according to the 4th IMO GHG study.
Shipping is seen as one of the most challenging sectors to decarbonise. Hence, swift and effective action must be taken to curb the sector’s emissions and provide suitable legislation and incentives to contribute to its decarbonisation.
The full-scale deployment of technologies for the production of low-carbon fuels requires policies providing clear, stable and robust regulatory signals to investors.
To facilitate a reduction of GHG emissions from shipping specifically, we believe the following principles to be important enablers of success:
- Given the international market structure of the shipping sector, global approaches should be the primary lever to drive the reduction of GHG emissions. We hence invite the EU to collaborate closely with its partners in the IMO, as well as endeavour to avoid climate ambition gaps between the EU and the rest of the world in the maritime sector, and regulatory overlap with the IMO energy efficiency design index (EEDI) and ship energy efficiency management plan (SEEMP);
- Ensure a technology-neutral approach, meaning that the same regulatory principles should apply regardless of the technology;
- Regulatory predictability is an essential pre-condition for mobilising investment and minimising the risk profile of low-carbon projects generally and sustainable marine fuel mainly;
- Develop a market for low-carbon fuels with a sufficiently high carbon price to support a business case for Synthetic Maritime Fuels supply and uptake whilst being mindful of the competitive effects of regionally specific measures
- To curb the GHG emissions from the shipping sector efficiently, any policy regime should consider GHG abatement along the full value chain of marine transport, from efficient ship design and ship operation, over low-carbon port infrastructure, to sustainable marine fuels.
If the EU wishes to move ahead of the international community with regard to shipping decarbonisation and create the enabling conditions for a low carbon marine fuels market, it should do so in a manner that avoids carbon leakage, safeguards the competitiveness of the EU shipping sector and marine fuel industry, and avoids frictions or redundancies between global and national policy schemes. Options for the EU could include:
- Integration of shipping into a dedicated, stand-alone cap & trade system;
- Regulation on sustainable marine fuels through carbon intensity requirements;
- Policy levers that provide investment support, which may include fiscal measures.
Read our position paper on reducing greenhouse gas (GHG) emissions in shipping here.
Read our Fit for 55 recommendations here.