UK Chamber Asks Britain Not to Adopt its Own GHG Scheme for Shipping

Port of Felixstowe file image

Published Feb 14, 2022 2:18 PM by The Maritime Executive

Though the IMO has yet to adopt market-based measures for greenhouse gas emission reductions, the UK Chamber of Shipping is urging the British government not to step in and regulate carbon from shipping on its own. 

The Chamber says that it supports regulating GHG at the IMO level, where - due to opposition from China, Russia, Saudi Arabia and other oil-dependent nations - Western delegates have been historically unable to enact binding regulations to advance a green energy transition.  The IMO Marine Environment Protection Committee recently turned down a $2 per tonne (0.3 percent) bunker charge to fund decarbonization research, dimming the political prospects of the far larger $450-900 per tonne charge that analysts believe would be necessary to counter the cost advantages of affordable HFO and VLSFO. 

In an address last week, Chamber President John Denholm CBE urged IMO Secretary General Kitack Lim to lead the charge and organize an international effort to regulate GHG. 

“Secretary General, in recent months you have talked about what needs to happen and I urge you now to show bravery and leadership and convince everyone of the urgency – and give us the market based measure that will drive the change," said Denholm. “A market based measure is not about raising revenue, it is about driving change, and if the system adopted takes money out of the equation it is simply going to mean that the cost of the change is going to be greater."

Given IMO MEPC's historical record on greenhouse gas regulation, the EU has charted its own path, extending its Emissions Trading System to cover carbon emissions from vessels calling EU ports. The UK is no longer part of the EU, but it recently included shipping emissions in its own GHG inventory, and it is said to be considering a similar carbon-credit scheme. 

"I know it must be tempting to follow the route that Europe is taking to establish a regional Emission Trading Scheme, as the money this would raise would help reduce the budget deficit," said Denholm in an appeal to the UK government. "It all sounds terribly simple - tax half the emissions of a ship arriving in the UK - but the devil is in the detail . . . Please don’t be tempted! It is not simple a plethora of regional market based measures would put a terrible burden on our industry, depress trade and would inevitably be inequitable."

Instead, the UK Chamber is calling on the British government to oppose other nations' regional or national regulations on greenhouse gases from shipping.