United Kingdom: A new study has revealed that greenhouse gas emissions from the shipping industry could be reduced by 50 percent by 2030 without negatively impacting global trade. This comes as countries gear up to discuss the implementation of a potential carbon tax on emissions produced by ships.
Currently, maritime transportation accounts for approximately 3 percent of global greenhouse gas emissions, with limited alternatives to the cheap, heavy, and polluting diesel oil commonly used by ships.
The shipping sector has been slow in adopting emissions reduction technologies, prompting an increasing number of countries to advocate for a tax on shipping as an incentive for shipowners to invest in emissions-cutting measures and support climate-affected nations.
The International Maritime Organization (IMO), the United Nations division responsible for global shipping regulations, is convening in London today for a two-week-long discussion on decarbonization efforts and the viability of implementing a carbon levy of up to $100 per tonne of carbon emitted by ships.
A shipping levy was discussed by nearly 40 world leaders and the heads of global financial institutions last week in Paris. The summit for a new global financing pact, hosted by French President Mr. Emmanuel Macron, heard arguments from developed and developing countries in favour of a tax, the revenues of which would flow to the “loss and damage” fund to help countries suffering the ravages of extreme weather.
Estimates from the World Bank suggest that a carbon tax on shipping could generate annual revenues ranging from $50 billion to $60 billion.
Japan, the second-largest ship-owning nation globally, has proposed a carbon tax of $56 per tonne of carbon starting in 2025.
US Treasury Secretary Mr. Janet Yellen cautiously welcomed the proposal at the Paris conference, while John Kerry, US Special Presidential Envoy for Climate, expressed personal openness to the idea but clarified that it did not reflect the official position of the administration. The stance of the United States on the matter remains uncertain.
Mr. Yellen commented that “we are very focused on the need to raise substantial resources to address climate change, poverty reduction, and other global challenges. So we’re very open to innovative approaches. I think it is a very constructive suggestion and would agree with President Macron’s description of the logic of why it would be appropriate, and it’s something that the US will look at.”
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