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Wednesday, July 5, 2023

Shipping levy on maritime emissions opposed by Australia at IMO conference

Shipping, in transporting around 90% of world trade, creates about 1 billion tonnes of greenhouse gasses, or nearly 3 per cent of global carbon dioxide emissions. It is about the same amount as Germany or Japan. 

Pacific Island nations including Solomon Islands and Marshall Islands, proposed the introduction of a $100 per tonne levy on maritime emissions in order to make cleaner fuels cost-competitive with the dirtier heavy fuel oil that is the industry standard. 

But Australia appears to have joined Saudi Arabia, China, Russia, Brazil and other major states, to oppose this Pacific initiative for a levy on maritime emissions. Climate Home report identifies Latin American countries were also most vocal against the measure.

Fiji had proposed for the IMO, supported by a broad coalition of other Pacific nations, small island states and Least Developed countries:

  • 37% GHG emissions reductions by 2030
  • 96% by 2040 
  • full decarbonization of shipping industry by 2050. 

A carbon levy and global fuel standards was also proposed as part of the basket of measures. 

Conference outcomes:

  • failure to agree on absolute emission reduction targets for 2030 and 2040, 
  • identified “indicative checkpoints” of at least 20%, striving for 30% emission reduction by 2030, 
  • at least 70%, striving for 80% reduction by 2040. 
  • aim to reach only net-zero “by or around, i.e., close to 2050”, depending on “national circumstances”.
  • Green fuel mandates deferred.
  • “pricing of greenhouse gas emissions” (a levy), deferred, earliest would be in 2027.
John Maggs, from the Clean Shipping Coalition, said:

 “There is no excuse for this wish and a prayer agreement. They knew what the science required, and that a 50% cut in emissions by 2030 was both possible and affordable. Instead the level of ambition agreed is far short of what is needed to be sure of keeping global heating below 1.5ºC and the language seemingly contrived to be vague and non-committal. The most vulnerable put up an admirable fight for high ambition and significantly improved the agreement but we are still a long way from the IMO treating the climate crisis with the urgency that it deserves and that the public demands.” Read more by Clean Shipping, 7 July, 2023, UN agrees on a new climate plan for global shipping, but not 1.5°C aligned.


IMO’s Marine Environnement Protection Committee #MEPC, is meeting in London and is expected to adopt an upgraded IMO greenhouse gas strategy.

The Pacific levy proposal has received key support and backing from the European Union and many nations gathered at Paris climate finance talks held last month. Both the International Chamber of Shipping and World Shipping Council support the introduction of a levy.

The proposal sets ambitious decarbonisation targets of 37 per cent by 2030 and 96 per cent by 2040,  which would pull the industry in line with the Paris Agreement targets.

Under what is known as the “fair share” approach, the industry should not emit more than 12.2 giga-tonnes (GT) of GHG from 2020, which equals 3% of the global carbon budget to achieve the 1.5ºC temperature goal. With 37% emissions reduction by 2030 and a nearly total emission reduction by 2040 (96%), this leads to 11.25 GT CO2e cumulative emissions by 2050. This is the only trajectory where cumulative emissions by 2050 remain within the 1.5ºC carbon budget.

The levy would generate an estimated $US60 billion to $80 billion each year which would be used to fund the deployment of clean shipping technology and help developing nations decarbonise, reports the Age..

“I had personally expected [the new government] to change its work in the IMO in a direction that was much more positive to supporting the Pacific Islands positions,” said Michael Prehn, a Danish shipping expert who serves as the representative to the International Maritime Organisation for Solomon Islands.

“I am surprised by the Australian government not changing its actions in IMO to be more in the direction of supporting the Pacific Islands proposals.” reported the Age (July 3)

The Age reports a statement by an unnamed spokeperson for  Transport Minister Catherine King which provides rhetoric but fails to explain Australia's opposition to the Pacific proposal:

“With our own legislated national target of net zero by 2050, Australia will be an active player in advocating for an ambitious strategy and the phasing out of GHG (greenhouse gas) emissions from international shipping by 2050. We will also be looking for the establishment of interim ambitions to establish a clear transition pathway for industry and ensure the global fleet keeps on track,” the spokesperson said.

“As an island nation where 99 per cent of our goods are imported and exported by sea, Australia needs to carefully consider the details of any economic measures.”

The Age also reports an observer at the IMO meeting in London who articulated general disappointment in Australia's failure to change positions from the former Morrison Government for both the Pacific proposal and adoption of greater emission reduction targets.

“Under [former prime minister Scott] Morrison, Australia was incredibly badly received. Clearly, with the new administration, there was a hope that they could be more progressive, and Australia has been disappointing at every single meeting.”

Marshall Islands Ambassador to the IMO, Albon Ishoda, said "there can be no excuse" for global shipping not to clean up its act according to a report by Radio New Zealand.

Ishoda said the countries at the IMO have a responsibility to be guided by science and lead on the issue.

"If we set these targets this week and make a commitment to swiftly enact the measures to achieve them, the science-based path is one we can follow," Ishoda told delegates at the opening plenary of the 80th Marine Environment Protection Committee (MEPC80).

"But targets are meaningless without the right actions to implement them. We need the right measures to get us there," he said.

The Micronesian Center for Sustainable Transport (@mcst_rmi) tweeted:

"Although Australia has voiced support for alignment to Paris Agreement climate targets, they are opposed to the Pacific’s proposed shipping levy and it is currently undetermined if Australia would support alternative proposals."

Pacific Islands Climate Action Network (PICAN) (@CANPacificIs) tweeted:

"This will be the ultimate test for the IMO, to respond to the urgency as demanded by the IPCC and all climate science; t"o offer certainty for the industry as to the speed and trajectory of transition required, and equity to ensure that no State is left behind.


Simon Stiell, Executive Secretary of the UNFCCC (@simonstiell) tweeted:

"The science is clear: We need to reduce emissions in all sectors.

I call on the maritime shipping sector to lead by example.

The technologies exist. What we need is a clear transition plan for all ships and harbours to meet net zero by 2050.

My message at IMO #MPEC80"

 

Interesting twitter thread from the IMO negotiations by Ralph Regenvanu (@RRegenvanu), MP for Port Vila and Vanuatu's Minister of Climate Change Adaptation, Meteorology and Geo-Hazards, Energy, Environment and Disaster Risk Management:

"As we head into the final stretch of #IMO #MEPC80 meetings, I want to address some #disinformation we’re seeing about two goals we have this week: a) targets for decarbonisation, and b) the levy.

A thread:"

"Myth 1: "Developed countries are pushing for a GHG levy." Absurd. Developing countries in the Pacific are leading this fight. Decarbonising shipping & protecting the most vulnerable? OUR priority. We’ve picked up support from many developed countries, not the other way round."

"Myth 2: "1.5 aligned targets are unrealistic’" Nonsense. In fact, shipping has the tech, the scale, the institution in the IMO that can coordinate, to get us there. What it will show if we fail to set ambitious targets is one thing only: an absolute failure of political will."

"Myth 3: "Shipping ambition is split on developed/ developing lines." Wrong.  Pacific developing countries have been in the forefront of this – often well ahead of developed countries. Fellow developing countries should think twice before pretending they speak for us."

"Myth 4: "Carrying on as usual will keep costs down for developing countries." What will actually happen is that we’ll see regional and national approaches imposed that will tax developing countries’ trade with no money returned to them."

"Myth 5:"A levy will mess with markets." A few corrections: a) a comprehensive impact assessment in the coming year will assess just that; b) analysis so far indicates its impact on the vast majority of trade will be marginal - it’s a market signal; c) inaction will cost far more."

"Myth 6: "we can afford to carry on as usual." Tell that to those losing land & homes, to victims of drought & wildfires. Major shipping states and rich countries are making the transition already – the question is whether we make it equitable and go fast enough to save lives."


 The Clean Shipping Coalition (@CleanShippingCo) tweeted on July 7 at the end of the week:

"Thanks to the heroic efforts of the Pacific Island states pushing for higher ambition, the 🇺🇳 @IMOHQ  moved #shipping closer to #ParisAgreement. BUT: the agreed climate targets are not 1.5°C-aligned & shipping will exceed its 1.5°C carbon budget by 2033."

Pacific Islands Climate Action Network (PICAN) (@CANPacificIs) tweeted on July8:

"We are deeply disappointed in that Parties have fallen short of achieving the level of ambition needed to accelerate the just & equitable transition of the shipping sector; and securing our collective future, in particular that of the many climate frontline communities,SIDS& LDCs"

"We still remain concerned at the lack of ambition, and the lack of clarity in the strategy, notably that it does not quite align to the science-based 1.5C reduction pathways. In fact the science suggest that there be a reduction of 50% by 2030 – and 100% by 2040."

Industry Capture and Lack of Transparency

Climate Home reports that they identified ten oil and gas company lobbyists and over 50 employees of the shipping industry on the participant list of the International Maritime Organization (IMO) talks, which the media and public were barred from. Lobbyists from oil companies such as Shell, ExxonMobil and Saudi Aramco were on the guest list.

Climate Home quotes several NGO observers including Rasmus Bjerring Larsen, a policy officer at Green Transition Denmark who was at the talks. He told Climate Home: “Industry involvement at the IMO is overwhelming, particularly from big oil and ship owners. Meanwhile civil society and especially media representation is marginal.” Read more.


UN Secretary General calls for shipping emissions reduction to meet Paris targets

Secretary-General's video message to the 80th session of the Marine Environment Protection Committee:


Excellencies, friends.

Humanity is in dangerous waters on climate.

But the decisions you take over the coming days could help us chart a safer course.

Science tells us it is still possible to limit global temperature rise to 1.5 degrees Celsius.

But it requires an immense and immediate global effort.

And shipping, which accounts for almost three percent of global emissions, will be vital. 

The industry has seen some progress.

But it must move much faster to get on track and drive investment and innovation.

I urge you to leave London having agreed a Greenhouse Gas Strategy that commits the sector to net zero emissions by 2050 at the latest;

And that includes ambitious science-based targets starting in 2030 – both on absolute emissions reductions and the use of clean fuels.

These must include all greenhouse gas emissions and cover the whole value chain.

Such targets will provide the certainty that the industry and investors need.

I also urge you to commit to developing technical and economic policies and regulations to deliver on these targets and support a just, equitable transition. 

Measures such as carbon pricing will push the industry in the right direction by making zero-emission fuels more competitive.

While the finance generated can support the just transition in developing countries and address the needs of those most vulnerable to the climate crisis.

I look forward to welcoming leaders from government and business, including shipping, to the Climate Ambition Summit I am holding in September. To present credible, concrete action to keep 1.5 degrees alive.

Excellencies, friends,

This meeting of the Marine Environment Protection Committee is a chance to steer us towards a clean, prosperous future for the industry – and a safer future for humanity.

I urge you to take it.

Thank you.

  

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