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Statement by The European Shippers' Council

ESC welcomes agreement in IMO but opposed to fuel levies on GHG emissions in shipping

The European Shippers' Council, representing the freight interests of shippers across Europe, has welcomed the global agreement reached in IMO on a technical measure to limit CO2 emissions from international maritime transport - the adoption of the Energy Efficiency Design Index. It is the first globally binding measure to improve energy efficiency of new ships and limit CO2 emissions from international maritime transport. ESC believes that this is a major step taken by the IMO.

ESC agrees with the shipping industry that regional measures on GHG emissions in shipping should be avoided but at the same time ESC is contributing constructively to the discussions of the European Climate Change Programme (ECCP) of DG Climate. ESC acknowledges the importance of climate change for society and recognises the responsibility users of transport services have in helping to reduce Green House Gas (GHG) Emissions of their supply chains. But ESC argues for GHG reduction measures which are incentive-based, rather than punitive; rewarding the reduction of GHG emissions of each vessel, rather than punishing those that do not.

ESC is opposed to a uniform levy or tax on fuel purchases or which allows for costs or charges to merely be passed on to the customers through surcharges without offering a clear incentive to increase the efficiency of a ship or regardless of the vessel’s efficiency.

Mandatory ‘slow steaming’ or establishing an upper speed limit of vessels as suggested by some NGO’s in the EU is equally not supported by the ESC. Such a strategy would reduce the service performance, require additional ships to maintain the schedule and frequency of delivery, add to the costs of supply chains, and potentially increase the emissions of GHGs.

Secretary General of ESC, Nicolette van der Jagt said, "There needs to be clear recognition of the fact that whatever scheme is introduced it should not raise the costs of efficient services, or curb economic growth. It must also provide an incentive to ship owners and operators to invest in ships and technology that reduce emissions. If you simply introduce a levy that punishes all carriers for emissions, they will just pass it on to customers. Where is the incentive in that?"

ESC believes shippers will increasingly be drawn to those ships which attract lower costs for the supply chain from lower emissions, provided the service does not diminish. "But can we wait for all nations to be ready with an instrument? We don't think so. Ultimately a global scheme is better than one regionally devised; but it may be unrealistic to expect it to be adopted in one go. First movers in a scheme that rewards best practice rather than punishes existing practice, however, should gain market advantage."