Global summit on all-sea transportation for carbon emissions

The global shipping regulator aims to seal consensus this week on measures to reduce carbon dioxide emissions this decade that would keep alive the possibility of an international pollution control tax for the country. industry.

The stakes are high for large shipping companies such as Maersk, CMA CGM and Cosco, and freight traders such as Trafigura and Cargill that have sought to reduce transport costs, with decarbonisation estimated to cost billions of dollars. dollars.

Delegates from 174 countries plus a number of industry observers to the meeting of the International Maritime Organization (IMO), the powerful UN body that regulates transport, were in talks for a week on measures to reduce the carbon intensity of the global fleet by 40 per cent by 2030 compared to 2008 levels.

The adoption of the plan would also mark the first concrete step to implement a strategy to reduce global transport emissions by at least 50 percent by 2050.

Maritime transport, the lifeblood of global trade that pumps about 2.4 percent of annual CO2 emissions, is difficult to decarbonize because clean fuels such as green hydrogen, ammonia or methanol they are not widely available and currently cost much more than fossil fuels.

The real importance of the meeting, in the view of many officials, depends on whether member states can emerge without divisions over climate change that would make a carbon tax deal for international shipping an even more formidable challenge.

“The adoption of the current short-term measures this coming week is another critical moment,” said Kitack Lim, IMO secretary-general. “Without this, we cannot develop our ambition in 2023,”

The so-called short-term framework includes two parts: an energy efficiency index for existing ships, plus a requirement to improve the carbon intensity of ships between 2023 and 2030. The latter measure links emissions of CO2 to charge volumes – which are likely to increase – instead of assessing absolute emissions.

Members on Monday agreed to an annual 2 percent reduction in carbon intensity for ships between 2023 and 2026.

Environmental groups have denounced the measures as submissive and that they are moving towards no consequences. A European delegation adviser said the carbon intensity requirement was a “paper tiger” with the lack of an application mechanism.

The resurgence of the United States as a force in climate negotiations has strengthened the coalition of EU states and some Pacific Islands pushing for greater ambition, but the approach also opens the risk of a “failure to decide something, ”in the words of a European delegate.

Developing countries, particularly in Latin America, are deeply concerned about a success in their trade-dependent growth and higher costs of basic goods caused by stricter environmental regulations. China and Russia remain opponents of significant action, European delegates said.

“It’s the developed world that tells the developing world to stay where they are. The growth of world trade is in developing countries, ”said Edmund Hughes, a former IMO official for 10 years.

The question of the months and years to come is whether the IMO, slow, focused on consensus, can accelerate serious negotiations on the cost of carbon emissions from shipping and whether lobbying company corresponds to its public messaging.

“Policy makers are putting the most significant historical mandate to decarbonize transport,” said Rasmus Bach Nielsen, world leader in fuel decarbonisation at freight trader Trafigura, who believes the IMO needs to agreement on a carbon tax from 2023 beginning two years later.

There are signs of marine change from the industry itself. This month Maersk, the world’s largest container shipping group, suggested a tax of $ 50 per tonne of CO2 by around 2027 that should increase to more than $ 150.

The industry has also proposed a payment of $ 2 per tonne of fuel, equivalent to $ 0.7 per tonne of CO2, to create a $ 5 billion pool for clean fuel research and development. But many delegates are concerned that this will be used as an excuse to delay the introduction of a substantial carbon tax.

An unlikely couple of candidates – Marshall Islands and Solomon Islands – have submitted the only proposal for a significant financial incentive to decarbonise the shipment to $ 100 per CO2 tonne. Marshall Islands is emblematic of tensions. Its islands are mostly shallow and at risk of global warming. At the same time, it has a large shipping register and is generally aligned with the interests of the industry.

“If we look at the IMO as a huge ship, then we need to start turning now from the iceberg forward,” said Albon Ishoda, Marshall Islands delegate. “If we are allowed to have a transformation discussion, then this will guide progress on the ground.”

Lim of the IMO said the key to avoiding a confrontation over a tax was in the way the money raised will be used. “If everyone thinks we can take advantage of market-based measures, if it’s even on the developing side, then that will actually give momentum.”

Shipping groups are also likely to put their claim on the money. “If it goes into general government funds, then in the end, these costs will be passed on,” said Rolf Habben Jansen, Hapag-Lloyd’s chief executive.

Ultimately, the industry increasingly fears that its influence on regulation may slip away and risks being delayed in terms of climate change. “The worst thing for the global shipping industry is to have a patchwork of regional schemes,” said Anne Steffensen, executive director of Danish Shipping, a commercial body.

The EU is set to propose next month the extension of its emissions trading system to include maritime transport. If Brussels is destined for extraterrestrial travel, it will send waves of shock into the slow world of shipping.

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