E.U. Emissions Trading System Excludes Shipping, For Now

EU Parliament
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Published Nov 12, 2017 6:35 PM by The Maritime Executive

On Thursday morning, the European Parliament and E.U. member states agreed on a revision of the E.U.'s Emissions Trading System (ETS) that, for the time being, excludes shipping. 

The Parliament will move to include shipping in the trading system from 2023 if IMO progress in a CO2 strategy is considered insufficient.

The decision was reached after negotiations that extended late into the night. 

"We are very pleased that the two processes are now adapted to each other, instead of the E.U. impeding the current IMO work," says Casper Andersen, Director of E.U. Affairs at Danish Shipping. "The Parliament has for a long time been dissatisfied with the pace and ambitions of the IMO negotiations and therefore continuously maintains the pressure by proposing own initiatives. The pressure is now on IMO to deliver an ambitious strategy, but now the IMO countries have been given the time.”

The deadlines set for IMO's work on a global climate strategy are April 2018: adoption of an initial strategy for comprehensive emissions reductions from ships, including definition of ambition levels and short, medium and long term measures and Spring 2023: adoption of a revised strategy.

In October 2016, the IMO agreed on a roadmap for drafting a comprehensive IMO strategy for reducing GHG emissions from ships. Two key meetings on this were held in June and July 2017.

The E.U. has already introduced regulations that require companies operating ships over 5,000 gross tons to submit plans detailing their monitoring procedures. Monitoring and reporting will apply to shipping activities from January 1, 2018. An assessment of the possible alignment of the EU MRV scheme with the IMO data collection system concerning fuel consumption from ships is ongoing. Following this assessment, there could be further proposals to amend the EU’s MRV legislation in 2018.

The European Commission signed a contract with the IMO in 2015 providing EUR 10 million ($11.7 million) to implement a four-year project entitled "Capacity Building for Climate Change Mitigation in the Maritime Shipping Industry" to promote the uptake of low carbon technologies and operations in maritime transport.

The E.U. continues to successfully decouple its economic growth from its emissions. From 1990 to 2016, the E.U.’s GDP grew by 53 percent, while total emissions fell by 23 percent.