ESPO Position on the proposal for a maritime EU ETS

18 January 2022

European ports welcome the extension of the EU ETS to shipping, whilst stressing the importance of a global approach
The European Sea Ports Organisation (ESPO) welcomes the proposal to extend the EU Emission Trading System (EU ETS) to shipping. The greening of shipping is a priority for European ports, and ambitious policies are needed to deliver significant emissions reductions from the sector. Putting a price tag on emissions is in that respect a strong instrument to stimulate the sector to choose greener solutions. However, the effectiveness of this policy risks to be undermined if evasion is possible through rerouting of business. If such evasion is taking place, it creates not only carbon leakage but also business leakage for Europe’s ports and the port ecosystem.

EU policy must deliver real and significant GHG reductions in the shipping sector
European ports call for an EU ETS that is effective in terms of reducing shipping emissions in the EU without creating carbon and business leakage. The EU ETS is a climate policy, and not a taxation policy. It must put a price tag on emissions, and abide by the principle of the polluter pays.

ESPO calls for an ambitious geographical scope for the maritime EU ETS which avoids creating carbon and business leakage related to ports in countries neighbouring the EU
The Commission proposal for a European maritime ETS covers the emissions from intra-EU voyages and emissions at berth, alongside half of the emissions from extra-EU voyages (both incoming and outgoing voyages). Due to the limited scope of the ETS proposal, ships can find ways to avoid falling in the scope of the EU ETS as much as possible in order to minimise costs. Such practices must be prevented, in order to protect the integrity of EU climate policy, and to avoid undermining the competitiveness and connectivity of EU markets and ports.

Accordingly, ESPO calls for the maritime EU ETS proposal to proactively prevent evasive action by forcefully applying the polluter pays-principle. A possible solution – if legally possible - could be to expand the scope of the proposal by considering the evasive call to/from a non-EU neighbouring port as a call to an EU port. Evasive port calls at neighbouring non-EU ports could seriously jeopardise the effectiveness of the maritime ETS, as it would not reduce total shipping emissions. It could even increase overall emissions, in particular when evasion leads to longer voyages.

Revenues generated by a maritime ETS must enable the decarbonisation of maritime and ports
To deliver the greening of shipping, EU ETS revenues should be reinvested in the European maritime sector and facilitate achieving actual deployment and use of sustainable alternative fuels, including the electrification of vessels and designated infrastructure in ports. It is a matter of principle that revenues generated through a market-based measure should be used for the purpose of greening, in this case the transition of the maritime sector to net-zero emissions.

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