European shipping companies (ECSA) have called for key changes in the ongoing EU negotiations regarding ETS (Emissions Trading System) reforms. These changes are essential for achieving sustainable energy transition in the shipping industry and maintaining the competitiveness of this sector. Currently, shipping accounts for about 10 percent of ETS emissions while providing nearly 20 percent of ETS revenues.
Support for Sustainable Technologies and Increased Credits
Recent research indicates that to create a market for sustainable fuels and technologies, the number of ETS credits should increase from 110 million to 330 million. This increase will help shipping achieve carbon reduction targets and utilize the annual revenues of €9 billion generated from ETS more effectively.
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Shipping companies emphasize that all technologies that contribute to carbon savings should be supported. Additionally, predictability in legislation is very important; companies need assurance of covering part of the price gap between sustainable and conventional fuels before making investment decisions.
Emphasis on Domestic Production and Infrastructure Improvement
European shipping companies are also calling for incentives for the production of fuels and technologies domestically in Europe. These incentives should be provided as additional credits rather than production requirements in Europe. Furthermore, allocating a specific percentage of ETS revenues to shipping is essential to enhance the competitiveness of ports and infrastructure.
On the other hand, ECSA emphasized the necessity of eliminating administrative differences between reporting and compliance systems for offshore vessels. According to them, maintaining two different systems for these vessels increases unnecessary administrative burdens and undermines the competitiveness of the European offshore sector.
Ultimately, simplifying the EU's monitoring, reporting, and verification (MRV) regulations was proposed as a key to aligning ETS and FuelEU Maritime and reducing the administrative burden on companies. According to Sotiris Raptis, Secretary General of ECSA, "Shipping, despite accounting for only 10 percent of emissions, provides nearly 20 percent of ETS revenues and has never received a free allocation."
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