Causing a splash: maritime industry rejects EU emissions trading scheme

The shipping industry is the latest sector to challenge the EU on its inclusion of maritime activities in the European Union's Emissions Trading Scheme. Following the furore surrounding the planned inclusion of airlines in the carbon emissions trading scheme, recent announcements suggest that Brussels is in for another confrontation — this time with the shipping industry, which is crying foul and rejecting the ETS.

The International Maritime Organisation acknowledges that maritime emissions — estimated at 2.7% of global greenhouse gas emissions — are not insignificant, but argues there are other ways of reducing them. The same argument deployed by the aviation industry is being recycled: we operate globally and should not be required to participate in a regional scheme.

While there remains no global approach or consensus at a governmental level, this is an easy argument to make. The EU's response has been to acknowledge that the application of the scheme is imperfect but to press on, on the grounds that Europe has a responsibility to exert pressure on the industry to act — not unreasonable given that over 29% of global commercial shipping activity takes place in European waters, according to the OECD.

For now, the main parties have reached an impasse. Unlike with the aviation industry, the EU appears to be conceding, at least temporarily, that the scheme cannot be made to work for shipping. Could this be because shipping carries 90% of the world's merchandise and therefore carries considerably more political weight?

The obvious solution is a global agreement — the only mechanism that would leave the industry with little room to manoeuvre. Given recent failures to secure multilateral agreement on climate issues, this is a genuine challenge. The next round of international climate talks in Durban, South Africa in December is expected to focus in part on the aviation and maritime sectors. If anything meaningful is to be agreed, this represents the best opportunity.

In the meantime, the shipping industry may succeed where the aviation industry failed, and will live to emit another day — for now, at least, unrestricted.