Memorandum submitted by the department for transport (efs01)

 

Summary

 

The available evidence shows that emissions of both air quality pollutant and greenhouse gases from ships are increasing substantially as the volume of maritime traffic continues to grow. Air quality pollutant emissions from ships are predicted to outweigh those from all land sources combined by 2020[1], and greenhouse gas emissions from ships are predicted to double by 2050[2] in business-as-usual scenarios.

 

However, recent developments in the International Maritime Organization (IMO) on revisions to Annex VI of MARPOL (the International Convention for the Prevention of Pollution from Ships) to further limit emissions of sulphur oxides (SOx) and nitrogen oxides (NOx) from ships demonstrates the commitment of the international community to improving maritime environmental performance. This commitment is reinforced by efforts within the IMO to agree measures to limit greenhouse gas emissions from ships by its Assembly in late 2009, which the UK fully supports and in which we are playing an important role.

 

The Government is clear that shipping emissions must be tackled and that the shipping sector must operate under carbon limits. We believe that a coordinated multilateral maritime carbon emissions trading system (ETS) is the best option for delivering cost effective reductions, while maintaining a thriving shipping sector. We are working with industry and our European partners to develop this concept. But it is paramount that anything we do in the UK takes us closer to a global solution and does not have the detrimental impact on international negotiations, carbon leakage and the wider UK economy and UK employment; that could result from unilateral action.

 

The Government is also assessing other options for reducing greenhouse gas emissions from ships. We have commissioned research into the technological and operational abatement potential for reductions of both pollutant and greenhouse gas emissions, with a view to maximising any synergies between the two areas.

1.
Shipping in a carbon constrained world

 

1.1. When comparisons on a Carbon Dioxide (CO2) per tonne/km basis are made, shipping is the most carbon efficient method of mass transport. However, it is vital that the shipping sector plays its part in reaching any carbon targets set at the global, EU or UK level. Ideally this share would be determined by the cost of abatement relative to other sectors so that the most efficient solution is found across the whole economy. The Government therefore believes that the maritime sector must operate under carbon limits.

 

 

2. Global shipping's contribution to climate change

 

2.1. Estimating global greenhouse gas emissions from shipping is challenging due to a lack of data and scientific uncertainty on overall impacts. Research on quantification of impacts of shipping emissions impacts had previously focussed on emissions of CO2, although some studies have also estimated Methane (CH4) emissions. There are also believed to be global climate impacts from the emission from ships of black carbon and NOx. Work continues to reduce the uncertainty around these impacts.

 

2.2. Within the guidelines of the Intergovernmental Panel on Climate Change (IPCC), shipping emissions are classified as either national navigation (which includes domestic waterborne navigation and fishing) or international.

 

2.3. According to an interim report[3] of the International Maritime Organization's (IMO) updated study on greenhouse gas emissions from ships, international shipping emissions in 2007 were estimated at 847Mt of CO2 (20% to reflect uncertainty inherent in the calculation method). This equates to 2.7% of total global anthropogenic CO2 emissions. If domestic, non-military shipping is included CO2 emissions are estimated at 1019 Mt ( 20%), i.e. 3.3% of global emissions.

 

2.4. The table below compares the IMO central estimates for the base and forecast years with an earlier study by Eyring et al:

 

Global emissions from shipping

Updated IMO study (unpublished draft)

Eyring et al., 2005

Year

2007

2020

2050

2001

2020

2050

CO2 (million tonnes)

*mid-range estimates

1019

926-1073*

2036-2989*

813

1110-1188

1109-2001

 

 

2.5. The IMO figures were calculated using a 'bottom-up' approach: an analysis of activity data which estimates the total fuel consumption (and thereby emissions of CO2) of an inventory of a variety of ship types above 100 gross tonnage, based on factors such as their installed power, average load and fuel-type. Eyring et al developed an activity based inventory using fuel consumption and fleet numbers.

 

2.6. The IMO's updated study is expected to predict significant increases in CO2 emissions from international shipping, to over double current emissions, by 2050, if globalisation continues on its current trend. Historically, emissions have risen with global GDP growth, leading to higher demand for international transport. As the primary mode of international freight transport, demand for shipping services has increased; leading to higher CO2 emissions despite improvements in the efficiency of ships. Forecasts therefore predict continued increasing emissions in the absence of new policy.

 

 

3. Assessing the UK's share of international maritime emissions

 

3.1. According to the UK national atmospheric emissions inventory (2006), which is compiled using current IPCC guidelines, CO2 emissions from international shipping attributable to the UK constituted 3.9% of the UK's total transport emissions.

 

3.2. These emissions were calculated using sales of marine bunker fuels in the UK (including Crown Dependencies and the Overseas Territories that have ratified the Kyoto Protocol: Bermuda, Cayman Islands, the Falkland Islands, Gibraltar and Montserrat) for international navigation. This methodology assumes that responsibility for emissions stems from the country that possesses the ship fuel before it is purchased by the ship. Vessels trading internationally are likely to buy fuel where prices are lowest. Emissions measured in this way are therefore sensitive to changes in the relative price of fuel in the UK and its trading partners and may not be an accurate measure of emissions from international shipping attributable to the UK. In addition, the ability of vessels to bunker fuel for long periods of time means that much of the international seaborne traffic between the UK and its partners may not be captured by the UK national atmospheric emissions inventory.

 

3.3. There are several other possible ways of splitting emissions between countries. In 2005 Entec carried out a study for the European Commission to quantify global emissions (the total of emissions from national and international navigation) at the European Union and UK levels using different methodologies, and these gave radically different results:

 

 

 

European and UK shipping emissions, 2000, million tonnes carbon dioxide

Assignment methodology

Coverage

Method

EU27+2

UK

A1

Location of emissions:

12 mile zone

European waters

All vessel activity in EU/UK waters

38.34

6.00

A2

Location of emissions: 200 mile zone

European waters

All vessel activity in EU/UK waters

120.64

13.35

 

B

Flag of ship

 

EU/UK registered vessels

Worldwide EU/UK vessel activity

196.63

11.76

C

Bunker fuel sales

EU/UK reported sales

Top-down

159.24

9.69

D

Reported bunker fuel consumption

EU/UK reported fuel consumption

Top-down

158.91

9.51

E

A2 EU result divided between countries in proportion to freight tonnes loaded

European nations

Top-down

120.64

16.59

F

A2 EU result divided between countries in proportion to land based national emissions

European nations

Top-down

120.64

16.14

G

Country of departure/destination

EU/UK port activity

Vessel activity 500+ GT

152.42

23.82

Source: Entec 2005

 

3.4. The United Nations Framework Convention on Climate Change (UNFCCC) Subsidiary Body for Scientific and Technological Advice considered these, and other options for allocating international maritime emissions to national totals. However, there are difficulties with each option:

 

Allocating maritime emissions in proportion to national economy-wide emissions (method F) or freight tonnes loaded (method E) without reference to additional use of shipping services - this contradicts the principle that the 'polluter pays'.

Nationality of carrier (method B) - shipping operates in national and international markets and shipping companies have weak ownership, management and operational links to individual nation states. Ships can easily change their nationality (or 'flag') to avoid flag state regulations.

Country of origin or destination of the ship (method G) - measures based on this kind of allocation could result in evasion through the establishment of hubs just outside the states implementing the measures e.g. if implemented by the EU, at the African Mediterranean coast, this will lead to increased emissions, transport delays and increased shipping costs.

Origin or destination of cargo - this presents data difficulties, especially in the case of vessels on multi stop itineraries.

Nationality of passenger - only relevant for cruise ships and ferries and presents data difficulties.

Fuel sales (method C) - is subject to distortions, see paragraph 3.2.

Reported fuel sales and fuel consumption (methods C & D) - are based on data believed to underestimate significantly actual maritime fuel use.

Vessel activity methods (A, G) - are data hungry and hence costly.

12/200 mile zone method (A) - better suited to assigning local pollutants.

 

3.5. Because of the difficulties outlined above, the UK and the EU are exploring the possibility of a trans-national sectoral approach in the UNFCCC. Unilateral action by the UK before these negotiations are completed and an international allocation method agreed upon would prejudice the UK position in these and other negotiations on greenhouse gas emissions from ships.

 

3.6. The Government is clear that we must address international shipping emissions. But it is paramount that anything we do in the UK takes us closer to a global solution and does not have the detrimental impact on the wider UK economy and UK employment; which could result from unilateral action.

 

 

4. Work in the International Maritime Organization on Greenhouse Gas Emissions

 

4.1. The Secretary-General of the IMO has declared his intention that parties within IMO should agree on measures to reduce greenhouse gas emissions from ships at the IMO Assembly in late 2009. The IMO should be able to report good progress to the UNFCCC Conference of the Parties in Copenhagen in December 2009.

 

4.2. Many countries in the IMO are concerned about the adverse impacts any action might have on world trade and economic development. Developing and newly industrialised countries maintain that the Kyoto Protocol principle of 'common but differentiated responsibilities' should apply to IMO solutions - i.e. that only developed countries (those listed in Annex I to the UNFCCC) should take action. They are also keen to avoid prejudicing their position in the UNFCCC negotiations on a post-2012 agreement on climate change.

 

4.3. A number of technological and operational solutions are already being discussed at the IMO by states and by environmental and industry NGOs; such as more efficient ship design, harnessing wind power, using alternative fuels and reducing speed. The IMO is also currently engaged in an update of its 2000 study into shipping's contribution to greenhouse gas emissions and the potential for abatement. The interim report will be presented to IMO's Marine Environment Protection Committee in October, and the final report will be submitted to the Committee when it meets in July 2009.

 

4.4. The UK Government supports the Secretary-General's goal to deliver a global solution. That solution must apply irrespective of the nationality (i.e. flag) of a particular ship. Any system must limit the risk of 'carbon leakage' by the transfer of goods to shipping not covered by the system, or to alternative less efficient transport modes. We support and contribute to the IMO work on improving data and identifying abatement options.

 

4.5. In the Government's view, the most likely progress within the IMO by 2009 will be agreement on the CO2 design index for new ships, along with the voluntary operational CO2 index for current ships and a range of voluntary operational and technological improvements.

 

4.6. However it is vital that ship owners, operators and charterers are also encouraged to implement technological and operational solutions through applying a carbon price and setting absolute caps. The Government believes that a global greenhouse emissions trading scheme for ships may best provide incentives to the shipping industry to improve its carbon efficiency; reduce emissions at minimum cost, and send a message to the world that the industry is serious about making its fair contribution to combating climate change. The UK is proposing that in the medium term (beyond 2009), the IMO negotiates a new convention to deal with greenhouse gas emissions from ships, using economic instruments such as an emissions trading scheme.

 

4.7. The European Commission is also stressing the importance of carbon pricing, but is focusing on a regional approach (such as inclusion of maritime emissions in the EU ETS) in the short term: it has made it clear that if there is not significant progress in the IMO by 2009 it will bring forward its own measures. The UK welcomes this and is therefore exploring the option of including maritime greenhouse gas emissions in the EU ETS, but believes that regional action should not be an end in itself, but a step towards a global solution. We are working with our European partners to explore how best to achieve this.

 

 

5. Work in the United Nations Framework Convention on Climate Change

 

5.1. The Kyoto Protocol requires Annex I countries to pursue the limitation or reduction of greenhouse gas emissions from shipping through the IMO. In addition, the final text of the UNFCCC Bali Action Plan contains references that ensure emissions from maritime transport are not excluded from future negotiations on a post-2012 global agreement on climate change.

 

5.2. EU member states are therefore working with the Commission to develop proposals for the maritime sector that can be considered by the Kyoto Protocol Ad hoc Working Group and the Ad hoc Working Group on Long-term Cooperative Action. The UK is working to ensure cohesion between the developments in IMO and the UNFCCC.

 

 

6. Developing new technologies and fuels, as well as more fuel-efficient operations

 

6.1. In order to identify and provide a better understanding of the technological options for low carbon commercial shipping and their long term economic viability, the Department completed a Low Carbon Commercial Shipping Study in March 2007. This research produced an overview report into the future technological options for low carbon commercial shipping and their long term economic viability. It will inform the Low Carbon Transport Innovation Strategy which will be used by other stakeholders as a basis for further work into meeting the UK's carbon reduction targets.

 

6.2. The Government has also recently commissioned a Shipping Emissions Abatement Techniques Review, which examines the technological and operational options for reducing air quality pollutant and carbon emissions, their applicability, impact costs and potential timescales for uptake.

 

6.3. The IMO is currently developing guidance on best practices for fuel-efficient operation of ships and on limitation of leakage rates for refrigerant gases and coolants in ships. Areas covered include:

 

Improved voyage planning and weather routeing

Optimum trim, ballast, propeller, rudder and autopilot

Hull maintenance

Propulsion system maintenance and modification

Improved fleet management

Improved cargo handling

Energy management

Use of alternative fuel oils

Renewable energy sources

 

6.4. Agreement on this guidance is expected at the IMO's Marine Environment Protection Committee in October 2008. The UK will be looking to optimise air quality and climate change improvements. Should a CO2 design index for new ships be mandated by the IMO in 2009, this would also result in measures to make ships more fuel-efficient being incorporated into ship design in the long-term.

 

6.5. In recent years, the UK has worked with other governments to explore and develop the concept of ships designed, constructed and operated in an integrated manner to eliminate harmful discharges and emissions throughout their working life, known as the "green ship" or "clean ship" concept.

 

6.6. The concept has been the subject of a great deal of work by the North Sea States, and was fully endorsed by the North Sea Ministerial Meeting on the environmental impacts of shipping and fisheries, held in Gothenburg on 4-5 May 2006. The "green ship" or "clean ship" concept needs to be developed further in the IMO.

 

 

7. Shipping and UK air quality and public health

 

7.1. While shipping has a generally good environmental record, it now accounts for a large (and growing) percentage of global emissions of atmospheric pollutants. Emissions from sea-going vessels can have a major impact on air quality on land. These emissions impact on the UK's ability to meet standards set by EU legislation concerning ambient air quality and national emission ceilings.

 

7.2. Many of the abatement measures to reduce greenhouse gas emissions, such as hull modifications, speed reductions and the use of solar/wind energy bring a concomitant reduction in emissions of air quality pollutants. The UK strongly supports such 'win-win' measures and the need to be aware of measures that reduce emissions of either greenhouse gas emissions or air quality pollutants, at the expense of the other.

 

7.3. The main pollutants which ships emit are:

 

Sulphur oxides (SOx) and Nitrogen oxides (NOx). These both have adverse effects on both human health and ecosystems.

 

Particulate matter (PM). Both short-term and long-term exposure to ambient levels of PM are consistently associated with respiratory and cardiovascular illness and mortality as well as other ill-health effects.

 

7.4. Polluting atmospheric emissions from ships are regulated via Annex VI of MARPOL (the International Convention for the Prevention of Pollution from Ships), which places limits upon SOx and NOx emissions, although it does not explicitly address particulate matter (although these controls will reduce the formation of secondary PM). Controls are also required under the EU Sulphur Content of Liquid Fuels Directive (1999/32/EC), which as amended provides additional restrictions on the sulphur content of some marine fuels including gas oils and those fuels consumed by passenger vessels operating between community ports. The directive additionally establishes a requirement for member states to monitor compliance of marine fuels sold within their territory.

 

7.5. The UK is in the process of implementing MARPOL Annex VI into domestic law. The public consultation on our draft law was completed on 15 August.

 

7.6. Once Annex VI had entered into force internationally, the IMO set the process of revising Annex VI in motion. The former UK Permanent Representative to the IMO, Mike Hunter, led an expert group to study the impacts on climate change, of the options for revision of Annex VI.

 

7.7. IMO's revision of Annex VI to the MARPOL Convention has made good progress and the UK has played a full part in negotiations, supporting the introduction of significantly more demanding targets, as well as the extension of the scope of Annex VI to cover particulate matter. The Government welcomes the agreement which was reached at the meeting of IMO's Marine Environment Protection Committee in April of this year, and the fact that all the outstanding issues relating to sulphur oxides and nitrogen oxides were resolved. The Marine Environment Protection Committee is expected to adopt the revised MARPOL Annex VI when it next meets in October. Implementation and enforcement of the agreement on sulphur levels in fuel is likely to be very challenging, but it does have potential to substantially reduce emissions of SOx and NOx from ships.

 

7.8. MARPOL Annex VI introduced the concept of a SOx Emission Control Area (ECA), which specifies tighter controls on sulphur emissions within its boundaries. The sulphur content of fuel oil used onboard ships must not exceed 1.5% m/m, or alternatively, ships can fit an exhaust gas cleaning system, or use other methods to limit SOx emissions in a SECA. The Government supports the SECA concept.

 

7.9. The North Sea ECA which covers most of the east coast of Britain as well as the English Channel, came into force in November 2007. (In fact, all EU Member States that border the North Sea ECA commenced monitoring and enforcement in August 2007.) The North Sea ECA will have a significant effect on reducing shipping's impact on air quality within the UK.

 

 

September 2008

 



[1] According to the Impact Assessment accompanying the Thematic Strategy on Air Pollution

[2] Unpublished, presented at the intersessional meeting of the IMO's Greenhouse Gas Working Group in June 2008)

[3] Unpublished, excerpts presented at the intersessional meeting of the IMO's Greenhouse Gas Working Group in June 2008