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02. December 2022

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Climate regulation should go hand in hand

The EU’s CO2 regulation of maritime and road transport must be aligned to ensure a level playing field between the two transport modes, says Danish Shipping.

Ships transporting goods between European ports will be included in European Emission Trading System (ETS) prior to the road haulage the short sea shipping sector competes with.

By choosing this approach the decision makers challenge the short sea shipping sector’s  competitiveness, says Danish Shipping. Commercial road transport has an advantage when it comes to transporting cargo with respect to speed, logistics, flexibility, and door-to-door delivery. A price increase on maritime transport due to the ETS carries the risk of leading customers to choose transport via road instead of sea.

”We fully support the EU’s initiative on reducing emissions from the transport sector, but we need to maintain a level-playing field by ensuring that the inclusion of commercial road  transport and short sea shipping is synchronized. This would also be consistent with the EU’s ambition to shift more cargo from land to sea  as to prevent congestion, wear and tear and accidents on the European roads”, says Maria Skipper Schwenn, Director of Climate, Environment and Security at Danish Shipping.

Shipping will be included in the ETS from 2024, while road transport will be included in the ETS a few years later. This will, all things considered, make it less attractive to choose transport by sea.

”The EU strategy on short sea shipping aims at a growth in seaborne trade by25 percent in 2030 and 50 percent in 2050. Hence it seems completely counterproductive  to include short sea shipping in the ETS before the commercial road transport. Thus, we recommend the EU to take this challenge seriously and make sure that the split between shipping and road transport does not take turn in the wrong direction”, says Maria Skipper Schwenn.

As to solutions, the Innovation Fund based on ETS revenue could for instance give  special consideration for sea routes that are competing directly with road transport. Currently 1.5 billion euros are to be dedicated  to the maritime sector. A part of these funds should assist in closing the price gap between the fossil and new green fuels in addition  strengthening the uptake of e-fuels for the shipping sector through the proposals FuelEU Maritime and RED III”, Maria Skipper Schwenn finishes.

 

FACTS about the EU’s future legal climate requirements

  • Shipping’s emission will be included in ETS from 2024 with payment of 40% of the emissions in 2025, 70% in 2026 and 100% in 2027

  • ETS II, which covers road transport, is still under negotiation but is expected to enter into force in 2027 depending on the negotiations. There is no phase-in period for road transport.

  • With ETS, expenses will increase with 42% from today until the full phase-in. In comparison, expenses for road transport will increase with 3% when ETS II enters into force.

  • FuelEU Maritime sets standards for the fuel used on ships.

  • RED III sets requirements on member states on the supply of green fuels.