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Greek shipowners welcome proposed EU ETS changes

Photo: EU/Mauro Bottaro EU flags fluttering in the wind
Greek shipowners welcomed proposed changes to the EU Emissions Trading System and expressed disappointment in the container sectors’ opposition to the changes.

Greek shipowners, who control some 58% of European Union tonnage, have welcomed a European Parliament report that recognises the commercial operators’ structural role in shipping and for the industry's decarbonisation and the need for a sector dedicated fund.

Welcoming the report of the European Parliament (EP) Rapporteur, German MEP Peter Liese, on the revision of the EU Emissions Trading System (ETS), the Union of Greek Shipowners (UGS) however expressed disappointment the container liner sector opposed the EP proposals.

“Liese’s report addresses the shipping industry’s concerns to a significant extent, primarily by recognising the commercial operators’ structural role in shipping and for its decarbonisation, in line with ‘the polluter pays’ principle as well as the need for a sector-dedicated fund,” said the Greek owners.

The report mandates the inclusion of a binding clause in contractual agreements between owners and commercial operators of their vessels and a dedicated Ocean Fund, where at least 75% of revenues from shipping's ETS allowances will be invested for the decarbonisation of the industry.

The Piraeus-based UGS points out that currently the production and availability of alternative carbon-free fuels and their related propulsion technologies are still at immature stages of development, especially for the ocean going bulk sector, while bringing these fuels and technologies to market eventually will be costly and will be primarily the endeavour of other stakeholders.

“It is unfortunate that an organisation representing mega carriers in the container liner sector exclusively has opposed the aforementioned EP proposals,” said the UGS in a statement January 28. The World Shipping Council (WSC) said changes to the EU ETS would corrupt the scheme.

The UGS also said it “fails to understand the argumentation, given that liner shipping companies are only partially commercial operators of chartered in tonnage and not chartering companies as is the rule in the bulk / tramp sector. “Furthermore, these liner shipping companies can readily pass on the costs of decarbonisation, including the cost of ETS allowances to their customers,” said the UGS.

The UGS primarily represents bulk / tramp shipowners, a sector that carries approximately 85% of global cargo tonne-miles, which is by far the largest and most efficient segment of shipping, where charterers, as a rule, are the commercial operators of the vessels, where thousands of primarily shipping SMEs compete under almost perfectly competitive conditions and where the shipping companies are price takers. “It is, therefore, essential charterers, as commercial operators of the vessels, assume responsibility in line with the ‘polluter pays’ principle,” contend the Greek owners.

“This is a fair approach, which the EU co-legislators can adopt in order to facilitate the decarbonisation of the shipping industry and minimise the potential administrative burden and cost,” said the UGS.

The UGS said it stands ready to engage constructively with the stakeholders in this legislative process, “to ensure the future EU rules are not only environmentally ambitious but also fair, workable in practice and compatible with the industry’s international characteristics and the need for it to remain competitive and sustainable in an environmentally sustainable future”.