European shipowners welcome the formal approval of the new EU ETS law today by the plenary of the European Parliament. Earmarking around 2 billion Euro of the revenues of the Innovation Fund for the maritime sector can mark a turning point in the decarbonisation of the industry.
Importantly, the Parliament and the Council have embraced the calls of the industry stakeholders to earmark EU ETS revenues back to the maritime sector to support the uptake of clean fuels and foster innovation. At least 20 million ETS allowances, which correspond to around 2 billion Euro under the current ETS carbon price, will be allocated to maritime projects under the Innovation Fund.
“Addressing the climate crisis and decarbonising shipping is not a question of ‘if’ but a question of ‘how’. Setting aside part of the ETS revenues for maritime is a victory for the energy transition of the sector. Dedicated support through the Innovation Fund is indeed key to bridge the price gap with clean fuels,” says Sotiris Raptis, ECSA’s Secretary General.
ECSA also welcomes the upholding of the “polluter-pays principle” through mandatory requirements for the pass-through of the EU ETS costs to the commercial operators of the vessels. The phase-in period and the gradual inclusion of emissions from shipping over a three-year period is also crucial to ensure a smooth transition for the sector. The co-legislators also agreed on special provisions for ice-class vessels, small islands and outermost regions.
While the new ETS marks an important step in the decarbonisation of the industry, sufficient amounts of low- and zero-carbon fuels will need to be available at an affordable price to maintain the industry’s global competitiveness. This should be a top priority of the proposed Net Zero Industry Act. As shipping is one of the most difficult to decarbonise sectors, the upscaling of affordable low- and zero-carbon fuels and technologies for the sector is key.
“Shipping being a cornerstone of Europe’s energy and supply chain security, this must be properly reflected in the strategic priorities of the new Net Zero Industry Act. For this reason, we welcome the inclusion of offshore renewable technologies and carbon capture and storage in the list of strategic net-zero technologies. In addition, renewable fuels of non-biological origin (RFNBOs) should be included in the Act, so that dedicated production capacity can be swiftly developed ,” added Sotiris Raptis.
This outcome follows the maritime industry’s statements on the earmarking of the EU ETS revenues of 29 September and of 22 November and of 30 November.
More info about ECSA’s position on Net Zero Industry Act.