---

The Chamber of Shipping, the representative body for UK-based commercial shipping, has announced that it is taking a lead position in the international shipping industry’s response to climate change by advocating a global and open emissions trading scheme.

“This is a bold and far-reaching decision that gives a lead to the rest of the shipping world,” said Martin Watson, President of the UK Chamber of Shipping.

“The UK industry recognises that shipping, which carries 80 per cent of all world trade goods – and 90 per cent of the UK’s trade – must make a significant contribution to the battle to reduce mankind’s carbon emissions.

“The carbon cost of carrying a ton of freight by ship is 10 times less than by road – and 100 times less than by air. Shipping is by far the most carbon-friendly transport mode. However, because so much freight is carried by sea, shipping does produce nearly three per cent of total emissions. We need to take whatever action is needed to try to limit those emissions – but without accidentally causing freight to be shifted from ships to other, less carbon-friendly forms of transport. That would be catastrophic in terms of total emissions.”

The move has been welcomed by Peter Lockley, Head of Transport Policy at environmental group WWF-UK. “I’m very pleased that the UK shipping industry is advocating an emissions trading system for ships and I look forward to working with them to refine and build support for the proposal.

"If designed well, the scheme would put a price on maritime carbon emissions, speeding up the drive for cleaner ships and helping to pay for low-carbon development in poorer countries. It would position shipping as a progressive and responsible industry, and I very much hope that it will be part of a global climate change deal next year in Copenhagen.”

The challenge that faces the industry and legislators is how to find a way to include shipping in a national carbon emissions reduction process.

Ships, by their very nature, move between countries, which raises challenging questions regarding the allocation of their emissions. Ships can also easily be moved between jurisdictions to avoid carbon regulation unless that regulation is applied on an international level.

Shipping is therefore one of the last significant global industries to remain outside any governmental framework for the reduction of carbon emissions. Although the UK’s Climate Change Act will bring in monitoring of (rather than setting targets for) emissions from shipping, it is not yet clear how or what measurements will be made.

What is clear is that the industry has already made significant improvements; there have been continuous increases in fuel (and therefore carbon) efficiency through economies of scale and technological advances. A modern container ship emits about a quarter of the CO2 that a container ship did in the 1970s – whilst carrying up to 10 times as many containers.

The UK Chamber of Shipping supports the IMO initiatives in creating a new ship design index which will encourage technical innovation for new ships. Alongside this, the IMO’s operational index will encourage fuel efficiency measures on existing ships.

However, the Chamber believes the scope for improvement in these areas is limited. "The high carbon efficiency of this mature industry means further operational and technical improvements are unlikely to be able to keep pace with reductions expected from other sectors," the Chamber said in a statement.

It believes that shipping can most effectively contribute through emissions trading. This would enable ship operators to decide whether to invest in emissions reducing technology/research or operating practice and thereby qualify for carbon credits. Alternatively, ship operators can decide to support significant improvements in efficiency in high polluting industries, particularly those in the developing world.

“The Chamber’s move is very much in line with the UK Government’s policy in the Climate Change Act adopted last month and the “carbon budget” recommendations published by the Climate Change Committee two weeks ago,” said Mr Watson. “Although an emissions trading scheme for the shipping industry remains a concept rather than a defined path (and many parts of the global industry are still to be convinced that this is the best course of action), we believe that the industry – if it wishes to remain in control of its own destiny – must decide upon a direction of travel and strive to deliver it.

"I believe that if we can provide leadership and make a coherent and compelling case then other national associations will follow and that this will empower our parent body – the International Chamber of Shipping – to adopt a robust and convincing position in the vital international negotiations ahead of the Climate Change Conference in Copenhagen in December 2009.”