Funds collected as part of the EU’s CO₂ Emissions Trading System (ETS) could be used to establish and scale up the production of green fuels in Europe, according to trade and employers’ organisation for Denmark’s shipping industry, Danish Shipping.
Right now, the global shipping industry is holding its breath and looking to London, where the IMO’s Net-Zero Framework will be put to a final vote on 17 October.
The organization noted that Danish shipping companies contribute billions to the scheme and argued that the shipping industry’s CO₂ payments should be used to build up green fuel production in the EU.
Danish Shipping has declared its full backing to the agreement, calling it a gamechanger for the decarbonisation of international shipping.
“The agreement at the IMO will be a gamechanger for the decarbonisation of international shipping once it is adopted. Then it will be full speed ahead – and Danish shipping companies are ready. But a key prerequisite for success in climate transition is that a lot more alternative fuels are produced than is the case currently. And that must also happen in Europe,” said Jacob K. Clasen, deputy CEO of Danish Shipping.
“It is only logical that the funds we ourselves contribute through quotas should also be used to create the production of the fuels we will sail on in the future,” added Jacob K. Clasen, Deputy CEO of Danish Shipping.
The EU has already introduced climate regulation of shipping through the EU ETS and FuelEU Maritime.
According to Danish Shipping, when the ETS is fully phased in by 2026, Danish shipping companies are expected to contribute DKK 3.8 billion to the system.
The organisation proposes that ETS revenues should be earmarked as a support scheme for the green transition of shipping, including both production and offtake.
“Those funds must be used to accelerate the build-up of green fuel production in Europe. Our shipping companies are ready to switch, but we cannot afford to wait for other regions to outpace us. We are facing investments worth billions. It is only logical that the funds we ourselves contribute through quotas should also be used to create the production of the fuels we will sail on in the future,” said Jacob K. Clasen in an interview with the shipping media outlet Søfart.
It is also crucial to ensure proper alignment between EU climate regulation and a forthcoming global IMO regime.
“The EU must adjust its rules to a global agreement. It must not result in double regulation and double payment. Ideally, we should have one system for regulating shipping’s CO₂ emissions,” Clasen concluded in an interview with Søfart.
