The debate that recently took centre stage in the local shipping community is one that has, in the past few years, been a slow-burning hot topic in at least two major cities in Europe namely in Brussels which hosts the EU Commission and the EU Parliament, and in London where the UN International Maritime Organization has its seat.

What started as a debate on air pollution caused by maritime transport is now a controversial subject that has grown into a veritable furnace that Hephaestus would be proud of.

I am referring of course to the EU Emissions Trading System (EU ETS) which has been described as ‘the EU’s policy to combat climate change and its key tool for reducing greenhouse gas emissions cost-effectively.’

Since January this year the EU ETS has been extended to cover carbon dioxide (CO₂) emissions from ships having a gross tonnage of 5,000 or more that enter ports within the EU, irrespective of the flags they fly. In a nutshell, the EU ETS now covers: (1) 50 per cent of emissions from voyages carried out by those ships when the voyage involves a port within the EU but starts or ends outside the EU; (2) 100 per cent of emissions from voyages carried out by those ships when the voyage is between two EU ports; and (3) all such ships which happen to be within EU ports.

As from 2026 the EU ETS will also cover methane (CH₄) and nitrous oxide (N₂O) emissions from those same ships.

Put simply, in terms of the EU ETS the owners and, or operators of these ships will be expected to purchase and surrender EU ETS emission allowances for each ton of reported CO₂, or CO₂ equivalent, emissions falling within the scope of the EU ETS system.

The first surrender of EU ETS emission allowances these owners and operators will be asked to make will fall due in September 2025 and will cover the reporting period falling between January 1 and December 31, 2024.

In effect in so far as the first surrender is concerned, owners and operators will be asked to cover 40 per cent of their emissions in the reporting period in question, and there will then be a gradual ramp-up so that in September 2026, owners and operators will be expected to cover 70 per cent of their emissions in the reporting period between the 1 January and December 31, 2025.

In September 2026 and thereafter they will be expected to contribute or surrender EU ETS emission allowances covering 100 per cent of their emissions in the reporting period falling in the immediately preceding calendar year.

In the whirlwind of dust set in motion by these developments, I feel it is instructive to acknowledge that, within the EU, maritime transport represents not more than 3 to 4 per cent of the bloc’s total CO₂ emissions [source: https://climate.ec.europa.eu].

Moreover, international shipping accounted for 10 per cent of carbon dioxide emissions produced by the transportation sector worldwide in 2022 [source: www.statista.com].

For comparative purposes, international and domestic aviation together represented 11 per cent of the total figure, and road transport a whopping 79 per cent of the pie! The latter sector will be covered by ETS2 but that, however only comes into effect in 2027.

Understandably there is a palpable sentiment in and around the global shipping community that, notwithstanding the ‘essential role it plays in the EU economy’ (to use the EU Commission’s own words https://environment.ec.europa.eu/eu-action/transport/reducing-emissions-shipping-sect_en?prefLang=bg.); and again that it is ‘one of the most energy-efficient modes of transport’, (https://environment.ec.europa.eu/eu-action/transport/reducing-emissions-shipping-sect_en?prefLang=bg)  shipping appears to have become one of the world’s preferred whipping boys when it comes to the imposition of burdens, including financial burdens, connected with the protection of the environment!

This is not, of course, to say that efforts to protect the environment, including the marine environment which is the theatre of the shipping world’s activities, should be snubbed, sacrificed or neglected in favour of lightening the costs that ship owners and operators are to be expected to face and which in any event are inevitably passed on to end consumers of goods and products carried by ships affected by these measures.

Nevertheless, it is also true to say that in so far as environmental protection is concerned, shipping is probably the most regulated means of transport globally.

Indeed several international conventions have come into force and have been adopted by countries all over the world covering civil liability for damage caused by oil pollution and, or by hazardous and noxious substances (including the establishment of special funds to provide for compensation for such damage), intervention on the high seas in cases of pollution by oil or other substances, and the prevention of pollution from ships (the 1973 International Convention for the Prevention of Pollution from Ships, better known as “MARPOL”).

The positive impact the latter convention has had over the past half a century is nothing short of dramatic. The volume of oil that ships leaked into the marine environment in 1970 was estimated to be just short of 400,000 metric tons peaking at around 640,000 metric tons in 1979 when MARPOL was still in its infancy.

Between 2004 and 2023 oil pollution from ships averaged around 20,000 metric tons annually with only one spike above the 100,000 metric ton mark that occurred in 2019 [source: www.statista.com].

These numbers speak for themselves. And they prove that without resorting to the imposition of direct financial burdens the shipping world is capable of drastically reducing its contribution to the pollution of the environment through appropriate regulation.

Annex VI of MARPOL, first adopted as far back as 1997 which entered into force in May 2005, limits air pollutants contained in ships’ exhaust gas, including sulphur oxides and nitrous oxides, and prohibits the deliberate emissions by ships of ozone-depleting substances.

Perhaps using measures such as those afforded by MARPOL (including through its several annexes), and other kindred instruments, far more may be achieved in the global efforts to thwart environmental pollution than possibly ill-guided measures that only serve to increase the cost of transporting goods and products around the world.