EU co-legislators close to agreement on inclusion of maritime sector in ETS review

Negotiators from the European Parliament and the Council of the European Union for the revision of the EU Emissions Trading System (ETS) will meet on Tuesday 22 November with the ambition of finding a compromise on the modalities surrounding the inclusion of greenhouse gas (GHG) emissions from the maritime sector in the carbon market.

During this new round of inter-institutional negotiations (‘trilogues’), the co-legislators will have to agree in particular on the scope and timing.

While the EU Council and the Commission are in favour of a gradual inclusion of CO₂ emissions from the maritime sector in the ETS to reach 100% in 2027 (Council) or 2026 (Commission), the Parliament wants to oblige shipping companies to surrender allowances corresponding to 100% of their emissions from 2024.

The Commission and the EU Council believe that the extension of the ETS should cover all CO₂ emissions from large ships (gross tonnage over 5,000 t) calling at an EU port on voyages within the EU (intra-EU) and 50% of the emissions from voyages starting or ending outside the EU (extra-EU voyages), as well as the emissions that occur when large ships are at berth in EU ports. The European Parliament, for its part, suggests covering 100% of these voyages from 2027.

The co-legislators will also have to resolve the issue of how the revenues generated by the extension of the ETS to ship emissions will be used. In particular, the Parliament proposes the establishment of an ‘Oceans Fund’ to support the decarbonisation of maritime transport, with 15% of the revenue used to help protect, restore and better manage marine ecosystems affected by global warming.

Another thorny issue is the extension of the ETS to maritime emissions other than CO₂.

In a press conference, which EUROPE attended, on Monday 21 November, German MEP Michael Bloss - the shadow rapporteur on this dossier for the Greens/EFA - seemed optimistic that a compromise on the maritime sector could be reached, despite the complexity of the aforementioned issues.

In addition to the maritime sector, negotiators will discuss the creation of a second ETS covering emissions from the heating of buildings and road transport (ETS2 or BRT ETS). However, it is not to be expected that there will be an agreement on this point, as the positions of the co-legislators remain far apart at this stage.

The next trilogue is expected to take place on 29 November. (Original version in French by Damien Genicot)