This week European Union (EU) legislators reached a landmark deal to bring maritime transport into the EU’s emission trading scheme (ETS), in a world first for any carbon market. Under the current plan, ships travelling within the EU will be required to pay for 100 percent of their carbon dioxide, methane, and nitrogen dioxide emissions for journeys within the bloc, and 50 percent of emissions of journeys to or from a non-EU destination. The percentage of emissions covered for intra-EU journeys would ratchet up over time, starting at 40 percent in 2025, before rising to 70 percent in 2025, and 100 percent in 2026. Smaller vessels would be exempt from the legislation, which is to apply on all ships above 5,000 gross tonnes.
While countries have agreed to adding shipping to the EU ETS, the details of the legislation will need to be endorsed by member states before being passed into law. The hope is that shipping’s inclusion in the ETS will encourage shipowners and builders to invest in clean technologies and solutions so as to reduce their carbon credit bill.