The EU on Wendesday (14 July) published proposals to make the shipping sector finally pay for its pollution and fossil fuels – and to start using cleaner maritime fuels.
However, the world’s first ‘green’ fuel mandate for the sector would actually boost the use of liquefied natural gas (LNG), a fossil fuel, claims green group Transport & Environment (T&E).
Under the proposed ETS Maritime, shipping companies will have to buy carbon credits for their pollution on voyages within Europe and for 50% of their emissions when travelling between EU and non-EU ports or in the opposite direction.
T&E welcomed the proposals to extend the EU emissions trading system to shipping and, for the first time, to tax shipping companies for part of the fossil fuel they purchase. The sector has escaped taxation for decades and was even exempted from the recent global minimum corporate tax requirements agreed by world leaders.
“The EU is finally making shipping polluters pay,” said Faig Abbasov, shipping programme director at T&E.
“Now lawmakers need to defend a carbon market that covers extra-European voyages, so that the biggest shipping companies are not let off the hook. The ETS revenues should be reinvested in deploying zero-emission vessels, port charging, and hydrogen refuelling infrastructure.”
But worryingly, the FuelEU Maritime proposal could lead to more than half (55%) of the energy used by ships calling at EU ports being LNG and biofuels by 2035, according to T&E’s analysis.
This is despite LNG offering minimal emissions reductions and releasing methane – a global warming gas up to 36 times more potent than CO2.
Meanwhile, the European Commission proposed a new infrastructure law (AFIR) requiring major ports to spend billions installing gas refuelling infrastructure for ships, helping lock in decades of fossil-fuel burning. In contrast, neither legislation requires or incentivises the deployment of genuinely sustainable e-fuels based on green hydrogen.
“The Commission remains the only major institution still recklessly pushing the industry to invest in LNG ships that will lock us into decades of further pollution and stranded assets. Governments and MEPs need to shift the focus onto promoting renewable hydrogen and ammonia instead.”
Discussions around the need to develop methanol bunkering operations are taking place at numerous ports ahead of estimated demand of above 7M mtpa by 2030, says Chris Chatterton of Methanol Institute.
‘Economics of the shipping market will be the key driver enabling methanol to be adopted at a higher pace going forth over next couple years as market begins to return to more normal rates,’ states COO.
Integr8 Fuel injunction varied by Singapore Court to allow former employees to start work at Hartree Group in December 2022 following failure to produce evidence on biofuels development plans.
Variability of sources can affect the stability and performance of biofuel bunkers produced from these feedstocks, in turn leading to difficulties in meeting regulations and industry standards, shares Bryan Quek.
Top three positive movers in 2022 were Bunker House Petroleum Pte Ltd (+7), Eastpoint International Marketing Pte Ltd (+5), and Eng Hua Company (Pte) Ltd (+6); newcomer Sinopec Fuel Oil (Singapore) gets 19th spot.
Livestock carrier also involved in earlier bunker claim with Glander International Bunkering due to remaining unpaid fuel bill of approximately USD 116,000, according to court documents obtained by Manifold Times.