Shipping to EU: Brown fuels aren’t green

Jim Corbett, World Shipping Council Environmental Director for Europe: "We are concerned that the current ETS language for maritime unintentionally favors so-called brown fuels from fossil production that increase GHGs.”

The European Commission’s proposals to include shipping in the EU’s emissions trading system (ETS) as from 2023 are now at the stage where the details of the regulation are being negotiated. Maritime interests are pushing for the total climate footprint of a fuel from production to combustion to be considered in the EU ETS for maritime.

In an open letter to EU policy makers, the World Shipping Council, Danish Shipping and several other organizations representing the full value chain behind green fuels are asking policy makers to push the regulation in the greenest possible direction.

The signatories to the letter emphasize the importance of looking at the climate impact of the new green fuels from extraction at the source to combustion.

“Renewable Fuels of Non-Biological Origins (RFNBOs) such as e-methanol and e-ammonia will play a key role for the maritime sector to align with the goal to limit global temperature rises to less than 1.5 degrees,” says the letter. “Today, engines for ships to use e-methanol exist, and engines for e-ammonia are being tested. For maritime transport to reduce its emissions, these fuels need to be produced and distributed in far greater amounts. Political commitment will be required to unlock the huge investments needed to succeed.

“The fuels of the future can be produced in more than one way. One example is methanol, which can be produced sustainably or from fossil energy. While both production pathways lead to the same product, the impact on the climate differs wildly.

“When creating regulations, politicians should consider the full picture to accurately capture the impact of the new fuels on the climate. Assessing fuels on a life-cycle basis includes the impact on the climate from producing, transporting and combusting the fuels.

“The EU-ETS proposal to include shipping in ETS only puts a price on the greenhouse gas emissions from combustion. However, some RFNBOs release GHGs during combustion that were captured upstream during production; in this way RFNBOs avoid releasing additional carbon into the atmosphere compared to fossil fuels. By including a life-cycle approach the ETS encourages the use of green fuels and put a price on new types of fossil fuels. Furthermore, the existing proposal that only considers direct emissions could encourage the use of fuels that have significant emissions during production but no emissions when used onboard.”

• Read the full letter HERE

“To support shipping’s transition to renewably produced marine fuels, the EU ETS must provide the right signal, taking into consideration the GHG emissions of fuels across their full lifecycle. We are concerned that the current ETS language for maritime unintentionally favors so-called brown fuels from fossil production that increase GHGs,” says Jim Corbett, the World Shipping Council’s Environmental Director for Europe.

In other words, when you set a price for the fuel emissions, it is important that a fuel is not considered green if it has left a significant climate footprint during extraction and production.

“Liner carriers are already investing in alternative fuels and technologies, and urge the EU to ensure policies are geared to accelerate investments in the necessary renewably derived fuels by adopting a full life-cycle perspective. Aligning EU ETS pricing with other EU Green Deal measures also supports Europe’s potential to become a major producer of renewable marine fuels,” says Corbett.

The open letter has been sent to representatives of the European Parliament, the Council and the Commission in the tripartite meetings on the legislative proposal.