UN body makes ‘breakthrough’ on carbon pricing proposal for shipping
After a decade of talks, there is consensus within the International Maritime Organization to put a price on emissions from shipping – the next question is how far
Countries agreed on the need to put a carbon price on transport emissions after more than a decade of resistance, which campaigners hailed as a “major breakthrough”.
At the International Maritime Organization (IMO) last week, countries broke the deadlock on medium-term measures to decarbonise industry.
The meeting concluded that there was consensus to price emissions from shipping “as part of a medium-term basket of measures”, according to a summarized by University Maritime Advisory Services (UMAS), which is in partnership with the Institute of Energy at University College London (UCL). There was general support for taking a “well to wake up” approach and pricing emissions from fuel production to consumption on board a ship, UMAS said.
“[Pricing shipping emissions] is not a new concept for IMO, but previous attempts to take it forward have failed. So it’s a huge step forward that there is now a consensus on this,” said UMAS Director Tristan Smith.
Market-based decarbonization measures on the table include technical measures, like introducing a fuel standard, as well as economic measures, like setting up a global carbon tax for industry. They will be discussed during a meeting of the IMO Environment Committee (MEPC) next month.
“Pricing needs to be complemented by a mandatory measure such as a fuel standard, but there is now much improved potential for a strong IMO incentive to decarbonise shipping,” Smith said.
Responsible closely 3% of global emissionsships emit approximately one billion tonnes of CO2 each year. Without further action, emissions from shipping are expected to reach 90-130% their 2008 levels by 2050.
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Major emerging economies have strongly resisted carbon tax proposals in the past. A proposal put forward by Pacific island nations for a carbon price of $100 per ton on bunker fuels previously received lukewarm support from EU countries and the United States.
But at the working group meeting last week, all EU countries and the US came out in favor of carbon pricing, with the UK, New Zealand and the Bahamas supporting carbon pricing. measurement for the first time.
“There is finally no doubt that we will put a carbon price on shipping,” Aoife O’Leary, a longtime IMO observer and head of Opportunity Green, a non-profit organization focused on international climate issues, told Climate Home News.
The price must be high enough to move quickly to zero-emission fuels, while providing a mechanism to support developing countries, O’Leary said. Countries must move into next month’s MEPC with “ambition, fairness and urgency”, she said.
“Last week’s IMO meeting is a major step forward,” said Diane Gilpin, CEO of the Smart Green Shipping Alliance, which develops technology solutions to help the industry decarbonise. “Obviously there are a lot more details to agree on, but in our experience shipowners are falling under the shadow of the whip.”
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The Marshall Islands and the Solomon Islands have proposed a carbon price of $100 a tonne on bunker fuels, while the world’s largest container shipping company, Maersk called to a levy of $150/t to encourage industry to switch to greener fuels.
But the shipping industry trade association has previously backed a tax of just $2 per ton of fuel to fund research and development of clean shipping technologies. This translates into a carbon price of $0.64/t.
Progress at the IMO came as the European Parliament approved its Fit For 55 package, which includes integrating shipping into the bloc’s emissions trading system (ETS).
This means that all ships transporting goods to and from the EU, regardless of the flag they fly, will be taxed on their emissions. From 2024, ships will have to buy carbon allowances to cover all emissions during EU voyages and half of those generated by international voyages that start or end in an EU port. Three quarters of the revenue generated proceeds from the auctioning of allowances will be paid into an ocean fund to support industry decarbonization efforts.
“We need ambitious action at all levels if we are to achieve the goals of the Paris Agreement,” O’Leary said.
“The IMO has only given a tentative agreement on a carbon price, which will hopefully progress ambitiously, but it’s certainly not at the stage where you could say it will. alone will reduce ship emissions by 1.5C,” she said.