05 December 2023
The European Parliament formally approved on Tuesday the new EU Emissions Trading System (ETS) law, earmarking around EUR 2 billion of the revenues of the Innovation Fund for maritime decarbonization.
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European shipowners welcome the formal approval of the new EU ETS law today by the plenary of the European Parliament. Earmarking around 2 billion Euro of the revenues of the Innovation Fund for maritime decarbonization. This can mark a turning point in the decarbonization of the industry.
Importantly, the Parliament and the Council have embraced the calls of the industry stakeholders to earmark EU ETS revenues back to the maritime sector to support the uptake of clean fuels and foster innovation. At least 20 million ETS allowances, which correspond to around 2 billion Euro under the current ETS carbon price, will be allocated to maritime projects under the Innovation Fund.
The European Union Council and Parliament have reached a provisional deal to include shipping in the EU emissions trading system (EU-ETS).
“Addressing the climate crisis and decarbonizing shipping is not a question of ‘if’ but a question of ‘how’. Setting aside part of the ETS revenues for maritime is a victory for the energy transition of the sector. Dedicated support through the Innovation Fund is indeed key to bridge the price gap with clean fuels,”Sotiris Raptis, Secretary General, ECSA
ECSA also welcomes the upholding of the “polluter-pays principle” through mandatory requirements for the pass-through of the EU ETS costs to the commercial operators of the vessels. The phase-in period and the gradual inclusion of emissions from shipping over a three-year period are also crucial to ensure a smooth transition for maritime decarbonization. The co-legislators also agreed on special provisions for ice-class vessels, small islands, and outermost regions.
While the new ETS marks an important step in maritime decarbonization, sufficient amounts of low- and zero-carbon fuels will need to be available at an affordable price to maintain the industry’s global competitiveness. This should be a top priority of the proposed Net Zero Industry Act. As shipping is one of the most difficult to transition sectors, the upscaling of affordable low- and zero-carbon fuels and technologies for maritime decarbonization are key.
“Shipping being a cornerstone of Europe’s energy and supply chain security, this must be properly reflected in the strategic priorities of the new Net Zero Industry Act. For this reason, we welcome the inclusion of offshore renewable technologies and carbon capture and storage in the list of strategic net-zero technologies. In addition, renewable fuels of non-biological origin (RFNBOs) should be included in the Act, so that dedicated production capacity can be swiftly developed ,”Sotiris Raptis, Secretary General, ECSA
The group also backed the final vote in plenary on the creation of the Social Climate Fund, another key component of the ‘Fit for 55’ package for maritime decarbonization. The fund will be worth EUR 86.7 billion, paving way for the realization of the just transition principle and leaving no one behind.
Maritime services company Bernhard Schulte Shipmanagement (BSM) is developing an IT platform that will cover the entire compliance process with the EU ETS (Emissions Trading System) set to be introduced in 2024 in view of maritime decarbonization.
The inclusion of the maritime sector into the EU Emissions Trading System (ETS) is done and dusted to be introduced from 2024. Bernhard Schulte Shipmanagement (BSM) is developing solutions to support its customers to navigate the complexity of the upcoming requirements.