Greenhouse Gases from Ships

Maritime transport remains the only form of transport not included in the EU’s greenhouse gas (GHG) emissions reduction commitment. At the same time GHG emissions from shipping account for 4% of the EU GHG emissions and this is expected to increase significantly in the future.

The Commission has decided to adopt a three step approach to address GHG emissions from the maritime sector: 
1) An EU-wide system for the monitoring, reporting and verification of emissions; 
2) Based on the data obtained, reduction targets for the maritime transport sector; 
3)  Finally, a market-based measure to reduce maritime GHG emissions.

Last week the Commission presented the first of those three steps, in a legislative proposal for an EU-wide legal framework for collecting and publishing verified annual data on carbon dioxide emissions from maritime transport.

The proposal forms part of a package of measures together with a Communication outlining the Commission broader strategy to address and GHG  emissions from maritime transport at global level in order to pursue the internationally agreed goal of keeping global warming below 2°C.

Scope of the Proposal

The proposal, which takes the form of Regulation (and therefore applies directly), would require ‘Companies’ (i.e. Ship owners or anyone having assumed the responsibility for their operation - such as the manager or bareboat charterer) to monitor and report on the emissions released by ships above 5000 gross tons.

This would apply to emissions made by such ships during voyages from the last port of call to a port under the jurisdiction of an EU Member State and vice versa, as well as ships within ports under the jurisdiction of an EU Member State.

The following ships would however be exempted from the scope of the Regulation:
• warships;
• naval auxiliaries;
• fish catching or processing ships;
• wooden ships of a primitive build; 
• ships not propelled by mechanical means; 
• Government ships used for non-commercial purposes
 
The monitoring of emissions would be checked by an independent legal entity (referred to as the ‘Verifier’ in the proposal) that has been accredited by a national accreditation body.

Monitoring and Reporting

Principles and methods

 ‘Companies’ would be required to monitor and report the amount and type of fuel consumed during a calendar year for every ship within each port under the jurisdiction of a Member State and for each voyage arriving to and departing from a port located under the jurisdiction of a Member State.

‘Companies’ would also be required to use the same monitoring methodologies to cover all emissions from the combustion of fuels. Annex I to the proposal lists the approved methodologies for monitoring and reporting greenhouse gas emissions this include:
• Bunker Fuel Delivery Note (BDN) and periodic stocktakes of fuel tanks;
• Bunker fuel tank monitoring on board;
• Flow meters for applicable combustion processes;
• Direct emissions measurements.

Monitoring Plan

 The proposal would require ‘Companies’ to submit the monitoring plan for each ship indicating the method chosen to monitor and report emissions and other climate-relevant information by 31 August 2017. The ‘Verifier’ would then assess the conformity of the monitoring plan with the rules set out in the Regulation.

The monitoring plan would have to provide precise information on the monitoring methodology used for a specific ship and, as a minimum requirement, contain the following information:
• The identification and type of the ship;
• The name of the company as well as the address, telephone, fax and e-mail details for a contact person;
• A description of the emission sources on board of the ship (e.g. main engines, auxiliary engines, boilers and inert gas generators and the fuel types used) as well as of procedures, systems and responsibilities used to update the completeness of the list of emission sources over the monitoring year;
• A description of the procedures used to monitor the completeness of the list of voyages;
• A description of the procedures for monitoring fuel consumption of the ship;
• Single emission factors used for each fuel type, or in the case of alternative fuels, the methodologies for determining the emission factors, including the methodology for sampling, methods of analysis, a description of the laboratories used;
• A description of the procedures used for determining activity data per voyage.

‘Companies’ would be required to regularly check a monitoring plan in order to verify that it reflected the nature and functioning of the ship and whether the monitoring methodology could be improved and would also be required to modify the monitoring plan if:
• A change in the ownership of a ship occurs;
• New emissions occur due to new emission sources;
• A change in availability of data could lead to a higher accuracy in the determination of emissions;
• Data resulting from the previously applied monitoring methodology was found to be incorrect;
• The monitoring plan is found to not be in conformity with the requirements of the Regulation.

Monitoring Activities

 From 1 January 2018, ‘Companies’ would have to monitor emissions for each ship on a per-voyage and an annual basis, based on the monitoring plan approved by the verifier.

With regard to the monitoring on a per-voyage basis, ‘Companies’ would have to monitor the following information: 
• Port of departure and port of arrival including the date and hour of departure and arrival;
• The amount and emission factor for each type of fuel consumed in total and differentiated between fuel used inside and outside emission control areas;
• CO2 emitted;
• Distance travelled and time spent at sea;
• Cargo carried.
With regard to the monitoring on a yearly basis ‘Companies’ would have to monitor the following parameters:
• The amount and emission factor for each type of fuel consumed in total and differentiated between fuel used inside and outside emission control areas;
• Total CO2 emitted;
• Aggregated CO2 emissions from all voyages within, between, from or to ports under a Member State’s jurisdiction;
• Total distance travelled, total time spent at sea, total transport work as well as average energy efficiency.

Reporting

 ‘Companies’ would also be required to submit an emission report concerning the emissions and other climate-relevant information to the Commission and to the authorities of the flag States by 30 April of each year starting from 2019.

This report would be required to include information concerning the data identifying the ship and the company, the monitoring method used, as well as the results from annual monitoring.

Verification and Accreditation

The proposal requires the ‘Verifier’ to assess the conformity of the monitoring plan. Where the assessment contains recommendations necessary to be incorporated within a monitoring plan, the respective company should revise its monitoring plan before the reporting period starts.

A ‘Verifier’ would also assess the conformity of the emission report with the requirements laid down in the proposal and verify certain key information, notably:
• the assigning of fuel consumption to voyages within the scope of the Regulation; 
• the reported fuel consumption data and related measurements and calculations;
• the choice and the employment of emission factors; 
• the calculations leading to the determination of the overall emissions, 
• the calculations leading to the determination of the energy efficiency.

Compliance and ¨Publication of Information

The proposal sets out further requirements related to the publication of information:
• When the emission report fulfils the requirements set out in the Regulation, the ‘Verifier’ would be required to deliver a document of compliance for the ship concerned.
• The Commission will make the emissions reported according to the Regulation as well as the information on the ‘Company’s’ compliance with the monitoring and reporting requirements publicly available  
• From 30 June 2019, ships arriving at, within or departing from a port under the jurisdiction of a Member State should carry on board a valid document certifying the ship’s compliance with the reporting and monitoring obligations for the concerned reporting period.

Member State Activities

Finally the proposal would require Member States to impose penalties for failure to comply with these monitoring and reporting requirements (as well as ensuring that those penalties are applied) and set up a system for the exchange of information and cooperation between national authorities.

International Cooperation

The Commission would inform the International Maritime Organisation about the implementation of the Regulation, with a view to improving the development of international rules within the IMO for the monitoring, reporting and verification of greenhouse gas emissions from maritime transport.

If an international agreement on the matter was to be reached in the future, the Commission states that it would necessarily review the Regulation.

Next Steps

The proposal will now be sent to the European Parliament and the Council for examination following the ordinary legislative procedure. The Commission intends for the Regulation to be legislated and enter into force by July 2015.