The European Parliament has given its final stamp of approval to a package of climate measures at the heart of its “Fit for 55” emissions plan, which aims to reduce the bloc’s greenhouse gas footprint by 55 percent to 2030.
The legislation puts shipping on the EU’s Emissions Trading Scheme (ETS) for the first time, bringing ship emissions onto the European carbon market with a phase-in period starting next year. The move is the product of extensive negotiations between the EU Parliament, Commission and Council, and still requires final approval from national representatives on the Council, reports the Maritime Executive.
Crucially, the package will allocate 20 million ETS allocations (worth around $2 billion at today’s value) to support the decarbonisation of shipping, a key industry demand, assures Maritime Executive.
The article cites that “Addressing the climate crisis and decarbonising maritime transport is not a question of ‘if’ but of ‘how’. Reserving part of the ETS revenue for maritime transport is a victory for the energy transition of the sector. Support dedicated through the Innovation Fund is in fact key to closing the price gap with clean fuels”, says Sotiris Raptis, Secretary General of ECSA.
Initially, the requirement will be phased in over a three-year period and incorporates another key demand from European shipowners: a mandatory tax shift to charterers, who determine routes, speeds and fuel consumption (and therefore emissions) of shipowners. Under the “polluter pays” principle, the new legislation recognizes the charterer as the ultimate source of CO2, although the tax is administered to the shipowner, according to Maritime Executive.
Owners of large cargo ships will be required to pay allowances covering 40% of emissions in 2024, 70% in 2025, and 100% from 2026. Onboarding will start later for large offshore vessels, to be included from 2027 OSVs and freighters under 5000 GT are currently not subject to the rules, and the EU will review their status in 2026. Non-CO2 emissions such as NOx and methane (from LNG) are covered by the scheme.
However, they assure that the battle for the decarbonisation of maritime transport in the EU is far from over, informs Maritime Executive. On Tuesday, a consortium of environmental groups, including Transport & Environment and WWF, filed a lawsuit against the European Commission to challenge the inclusion of natural gas in the EU Taxonomy, the list of “green” energy sources approved for financing of The EU.
Under current commission rules, certain natural gas projects are eligible for funding from the EU Recovery and Resilience Fund, Invest EU, the European Regional Development Fund and the Emissions Trading Scheme Modernization Fund. Gas is essential to the European economy, and member states, particularly in northern Europe, have invested millions in new LNG import infrastructure since deteriorating relations with Russia began last year, finalizes Maritime Executive.
Source: Maritime Executive