Trafigura Calls on IMO to Up the Pace on CO2 Curbs
By Jack Wittels (Bloomberg) — Trafigura Group said the shipping industry’s regulator needs to act with ‘lightning speed’ to cut carbon emissions from an industry that spews more C02 into the...
MSC Mediterranean Shipping Company is throwing its support behind a carbon tax on ship fuel as well a proposed global research and development fund to help accelerate the decarbonization of shipping.
With about 16% market share, MSC is currently the world’s second largest carrier and is projected to pass Maersk as the top global container shipping company in the world.
It’s now joining others in the industry calling for support a global R&D decarbonization fund, known as the International Maritime Research and Development Board, and also in backing a potential worldwide market-based measure that would include carbon pricing, aka a tax.
“Some form of global market-based-measure, incorporating carbon pricing, could help the industry to decarbonize by reducing the price gap between fossil fuels and zero-carbon fuels as they become available,” says MSC CEO Soren Toft. “At the same time, despite our huge investments into our fleet and operations, scalable long-term solutions simply do not currently exist for us to deploy on our ships. There is a gap in R&D to bring these alternative fuels and technologies to the market and the industry wide research fund will help us achieve the UN IMO’s policy targets.”
The call to action comes ahead of the next meeting of the International Maritime Organization’s Marine Environment Protection Committee to held next week to determine, or not, the shipping industry’s path towards reducing and eventually limiting its greenhouse gas emissions.
The International Maritime Research and Development Board (IMRB) is a first-of-its-kind $5 billion program, governed by the IMO, to fund research and development of alternative fuels that are urgently needed in order to achieve the IMO’s preliminary target of reducing overall greenhouse gas emissions from shipping by 50% by 2050, compared to 2008 levels. The IMRB will be funded through a “International Maritime Research Fund (IMRF)” of a mandatory $2 per metric of marine fuel consumed by every ship.
MSC is now joining an industry call to action to UN IMO member states to support the proposal for the in an open letter by CEOs of 17 members of the World Shipping Council on 3 June.
“Decarbonizing the shipping industry is a battle we must win. Only with options at scale for commercially-viable low or zero-carbon vessels can carbon pricing be a truly effective tool to catalyse the shift towards a zero-carbon future for international shipping,” MSC said in a statement.
Maersk earlier this week called for a $150-a-ton carbon tax on shipping fuel to help bridge the price gap between fossil fuels and greener alternatives that are currently much more expensive and not yet readily available as of now.
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