LONDON- The European Commission has proposed adding shipping to the bloc’s carbon market for the first time, in a move that is set to shake up the industry after years of avoiding pollution charges by the bloc.
But already there is disagreement about how it will work given the complexities of the shipping industry and how fast it can decarbonize.
With about 90 percent of world trade transported by sea, shipping accounts for nearly 3 percent of the world’s CO2 emissions.
Environmental campaigners say efforts by the industry to cut emissions are too slow and that including shipping in the European Union Emissions Trading System (ETS) will speed up decarbonisation.
Launched in 2005, the ETS compels manufacturers, power companies and airlines to buy permits to cover each ton of carbon dioxide they emit.
Prices for permits in the scheme are nearing 100 euros ($114.44) a ton, a level analysts say will spur further investment in low-carbon energy sources.
Last July the European Commission proposed adding shipping to the ETS gradually from 2023 until 2026 when shipowners would need to buy permits covering all their emissions inside the EU and 50 percent of their emissions from international voyages starting and ending in the EU.
The proposal must be negotiated by the European Parliament and EU countries before it becomes law.
However, the European Parliament wants shipping phased into the ETS earlier, by 2025.
It also wants the entity responsible for decisions affecting CO2 emissions such as buying the fuel to pay, meaning they would need to buy carbon permits. That could be the shipowner, or the commercial charterer or operator of a ship.
In contrast, the Commission has said shipowners should always bear CO2 costs.
Parliament wants the EU to consider extending the ETS to cover all shipping emissions to and from Europe, if regulatory efforts to curb emissions by the UN shipping agency, the International Maritime Organization (IMO), fall short.
If IMO measures cut emissions quickly enough to avert disastrous climate change, the EU could roll back its inclusion of shipping in the carbon market, Parliament’s draft proposal said.
