From Ambition to Action: MEPs must help put shipping on the right course to sustainability
Letter from the World Shipping Council, Assarmatori and Danish Shipping to Members of the European Parliament.
On 17 May, the ENVI Committee will vote on Peter Liese’s Committee Report amending the EC draft proposal to include international shipping within the EU ETS. We welcome this key moment in the history of EU climate action and on the path towards shipping’s green future.
The shipping sector represented by The World Shipping Council, Assarmatori and Danish Shipping is committed to achieving the EU Green Deal’s goals and to move as fast as possible to zero GHG emissions. To set the right course MEPs should vote for ambitious proposals that are also well calibrated to help shipping meet the challenges ahead. There are three key areas where we need the ENVI Committee to craft the best possible mechanism for a sustainable shipping sector. At the upcoming ENVI vote we advocate for:
Ambition to include all GHGs (CO2, N2O, CH4) and to properly value them in EU ETS
All GHGs must be covered to tackle climate change and further incentivize the introduction of real renewably derived shipping fuels reflecting the full life cycle of those fuels from production to use. To do otherwise would simply shift GHGs to another part of the value chain.
We urge MEPs to vote in favour of including all GHGs in the EU ETS as proposed in Compromise Amendment 14 and through delegated acts take into account well-to-wake performance of renewable and low-carbon fuels.
Setting the right geographical scope for ambitious and global GHG progress, while avoiding competitive and economic harm
We want a global carbon price. A clear and unambiguous EU ETS market signal for shipping within the EU network of ports will avoid carbon leakage. It will also accelerate a shift to low-GHG fuels, aligned in both scope and timing with the emerging technologies that really will reduce GHGs.
A regional EU ETS within the European Economic Area, i.e. an intra-EU scope, can best encourage global agreement at IMO, while minimizing trade and economic distortions with other nations. Intra-EU scope supports a resilient and sustainable EU economy, prevents GHG leakage, avoids competition risks for EU ports, minimizes consumer costs and does not hinder a global agreement where 80% of shipping emissions must be tackled. Proposals to extend coverage to 50% or 100% of international voyages invite unwanted trade and political consequences.
We therefore urge MEPs to reconsider the merits of an intra-EU scope rather than extending coverage as proposed in Compromise Amendment 18.
Ambition to foster: long term decarbonisation, through technological innovation; the legal space for diverse contractual relationships and compliance with clear responsibility
We recognise that freedom of contract ensures rational industry responses to demand and price signals and hence that the market will deliver the right balance to determine to whom the cost of allowances should be allocated.
Shared responsibility between shipowners and operators will be needed to jointly deploy technologies and modify operations to transition to lower-GHG fuels. Prescribing for the market who should be exposed to GHG pricing creates a barrier to innovation, slowing the energy transition to reduce GHGs from shipping.
Both shipowners and charters share a responsibility for the green transition respectively ensuring the right investments in new green ships and in the operations of ships. The Commission’s version of the text ensures that all parties can respond together to EU ETS market signals to achieve GHG reductions.
We urge MEPs not to restrict freedom of contract in a market-based measure as proposed in Compromise Amendment 16.
We would like to thank you for the consideration you may give to these perspectives from an industry that is ready, eager and with you now for sustainable change!