COS Position on Environmental Policy

Last Updated on Thursday, 29 April 2010 09:42

The Chamber of Shipping of British Columbia (COS) encourages the Government of Canada to be proactive in working with national governments within the International Maritime Organisation (IMO) framework to enact practical and measurable solutions to reducing the overall level of marine industry emissions in all forms.

A major concern for the marine industry is unilateral initiatives enacted by state or national governments. COSBC opposes such measures and actively seeks to ensure that the Government of Canada maintain a strong multilateral approach to marine emission reduction measures through the International Maritime Organisation.

PROPOSED NORTH AMERICAN EMISSIONS CONTROL AREA - APPROVED MARCH 2010

•  An application to establish a North American Emissions Control Area (ECA), was filed by the governments of the United States, Canada and France to the International Maritime Organisation in March 2009. The application is consistent with amendments to an IMO protocol known as MARPOL Annex V1 which was approved by the IMO in October 2008.

• The application was approved by IMO at the 60th meeting of the Marine Environmental Protection Committee (MEPC60) in March 2010.

• There are remaining questions as to whether the cost versus benefit of the proposed North American ECA extending a full 200 nm offshore is fully justified, likewise the inclusion of Alaska and Hawaii given the relatively low level of marine traffic in those states.

• COSBC has urged the Canadian Government to work with major trading partners and the bunker fuel supply industry to ensure the widespread availability of low sulphur fuel by the time of a likely ECA implementation date of 2012.

• COSBC also seeks clarification on the interpretation of what will constitute “reasonable due diligence” with respect to a ship owner securing supply of low sulphur fuel upon the enactment of this legislation. It will also be important to ensure a practical enforcement mechanism.

• ECAs currently in existence in Europe in the Baltic and North Seas. The Baltic Sea came into force on 19 May 2006 whilst the North Sea and English Channel came into force on 11 August 2007.

  
  
  
  
  A comparison of Global and ECA low sulphur fuel implementation dates as approved by IMO is as per below, however the 2020 Global date is subject to a review of low sulphur fuel availability to be conducted in 2018. Should it be concluded that the 2020 date cannot be met, there is provision for push back to 2025 but not beyond.

                                   Global                  Within ECA

2006                            4.5%                         1.5%
2010                             -                                1%
2012                            3.5%                           -
2015                             -                               0.1%
2020                            0.5%                           -

GREEN HOUSE GAS REDUCTION MEASURES

Technical and Operational

COS supports efforts underway to identify viable mechanisms to reduce CO₂ emissions from shipping including but not limited tothe development of technical and operational measures at IMO.These should include:

• An Energy Efficiency Design Index which should be implemented as a mandatory requirement for new ships, The objective is to ensure that a workable mandatory design index for all new ships which will thereby facilitate delivery of increasingly efficient vessels.
• To achieve short term GHG reductions, COS also encourages the early implementation of Ship Efficiency Management Plans (SEMP) and the associated Energy Efficiency Operational Indicator (EEOI) .
• Recognising that Voyage Management for many ships and trades is beyond the control of the ship owner or operator, COS urges all stakeholders in the supply chain, particularly charterers and port operators, to work with ship owners to maximise supply chain efficiency.

The nine original principles adopted by the IMO Marine Environmental Protection Committee (MEPC) should remain the foundation for agreement on further measures namely:

• Effective in contributing to the reduction of total global greenhouse gas emissions;
• Binding and equally applicable to all flag States in order to avoid evasion;
• Cost-effective;
• Able to limit, or at least, effectively minimize competitive distortion;
• Based on sustainable environmental development without penalizing global trade and growth;
• Based on a goal-based approach and not prescribe specific methods;
• Supportive of promoting and facilitating technical innovation and R&D in the entire shipping sector;
• Accommodating to leading technologies in the field of energy efficiency, and
• Practical, transparent, fraud free and easy to administer.

In addition, COS supports three additional criteria points are added to the original nine. The economic measure must:

• Be credible to stakeholders and able to demonstrate compliance with climate change goals, including monitoring.
• Give credit for actions already taken which have already resulted in GHGreductions.
• Provide a high degree of certainty so that business can invest with confidence.

COS believes that the International Chamber of Shipping (ICS) is the appropriate voice to lead the international shipping industry in measures to reduce GHG reduction under the framework of both the IMO and United Nations Framework Convention on Climate Change (UNFCCC). In this context, COS supports the following principals laid down by ICS:

Technical and Operational Measures

1. Shipping is already the most environmentally efficient transport mode but the industry is willing to do everything possible to enhance its efficiency.
   
2. The cargo carrying capacity of international shipping and hence its ability to accommodate carbon reduction is determined by the volume and growth of world trade. The relationship between these two factors is fundamental in determining how to regulate the efficiency of the shipping industry.
   
3. The magnitude of emission reduction that can be delivered by means of the EEDI, SEMP and EEOI must be assessed and measured. The shortfall between this figure and any emission target that may be set will determine to some extent the appropriate economic instrument(s) that could then be used to further reduce the impact of shipping emissions.
   
4. ICS has agreed that steps should be taken toward the development of Marginal Abatement Cost Curves for the international shipping industry as this appears to be the most appropriate mechanism to establish the commercial cost of carbon reduction over time and to take account of all available mechanisms.
   
5. Reliance on operational and technical improvements alone may not be sufficient and the industry may need to consider that some form of ‘financial’ or ‘market-based’ instrument. However, it would be premature at this stage to make such a commitment.
   
6. There is a need to invest in efficiency technology in order to promote innovative propulsion and power sources applicable to ships. These could include:
   • New types of fuel
   • New types of engines
   • More efficient hull forms
     
7. Optimising cargo carrying capacity and volumes for given trades

Economic Measures

1. The objective for ICS is to discuss the possibility of supporting a Market Based Instrument which complies with the MEPC criteria and the other parameters as set out by the ICS membership.
   
2. It is of paramount importance that any economic instrument should result in real global carbon emission reduction without delay after the instrument becomes operative. Successful demonstration of effectiveness in producing real carbon reduction in the global inventory as a result of measures adopted for shipping is an important element of the ICS position.
   
3. Any proposed economic measure to reduce CO2 from shipping should be regulated under the auspices of IMO.
   
4. The industry can be flexible for the time being on the appropriate legal instrument for implementation. Once the mechanism has been identified and agreed then it will be appropriate to decide how to require its application.
   
5. A single global scheme is the only appropriate one for international shipping.
   
6. The proposed scheme should be capable of pre-empting or replacing any regional systems already in place or where shipping is being considered for a regional of national scheme.
   
7. The MBI should be fair to both large and small operators and should avoid the risk of competitive distortion and/or modal shift. Unwanted modal shift could transfer trade to less environmentally friendly modes thereby increasing the global carbon inventory.
   
8. Whilst it may not yet be necessary to agree on an international legal instrument a mechanism should be established under the auspices of IMO that can be used to handle funds accruing from an MBI. The establishment of an International Administrative Body to undertake this function should be investigated.
   
9. Whatever scheme might be adopted, it is inevitable that ships would be required to report bunker purchases – and bunker suppliers their sales – using bunker delivery notes, to an appropriate body, so that total emissions can be assessed. Reporting could most efficiently be accomplished via the internet and should contain the following information:
   • • Ship’s IMO-number
     • Date and place of fuel purchase
     • Name and ID of fuel supplier
     • Type and quantity of fuel purchased
     • Reference number of the BDN, if received
       
10. Disbursement of funds raised would take into account the need to meet the requirements of the target imposed on shipping for GHG reductions – and it would be necessary to be able to demonstrate and verify that global carbon emissions had reduced as a result. The fund can be used for adaptation/mitigation measures in developing countries (to gain support from these countries according to the CBDR-principle) and to support R&D to develop more energy efficient ships and alternative energy sources for ship power production:
    • • Operational efficiencies
      • Innovative R&D for existing engines and hull form
      • R&D for alternative engines and alternative fuels
      • Innovative R&D for cargo applications
      • CO2 mitigation schemes.
        
11. The economic measure should be easy to comply with and straightforward to administer at the ship owner level.
    
12. It should be simple to identify the carbon cost so that companies can decide how to pass on such costs to customers if they so wish. Ideally this would also ensure that costs can be passed on to customers as quickly as possible.
    
13. UNFCCC negotiation text already treats international shipping as a notional country (or global entity) and proposes setting emission targets.
    

Additional Emission Reduction Measures

COS also supports the following initiatives:

• Provision of shore power (cold ironing) where practical to suitably equipped vessels.
  
• Development of scrubber and other technology based systems including fuel additives as an alternative to complete reliance on cleaner and by definition, more expensive fuels.
  
• Voluntary emission reduction incentive schemes which are designed to generate strong participation, meaningful reward and measurable emission reductions within existing vessel speed guidelines.
  
• Periodic regional marine vessel air emission inventory measurement. The next such inventory is scheduled to be conducted jointly with Environment Canada in 2010.
  
• The work of the British Columbia Marine Vessel Air Quality Working Group comprising representation from Environment Canada, Provincial Government, Metro Vancouver, COS, Port Metro Vancouver, ENGOs, First Nations and the International Shipowners Alliance of Canada.
  
• The work of the Ports of Vancouver, Seattle and Tacoma in developing a Northwest Ports Clean Air Strategy.
  
  

OTHER ENVIRONMENTAL MEASURES

• COS remains opposed to a number of provisions in Bill C-15 Migratory Birds Convention Act (2005) and Bill C-16 Environmental Enforcement Act (2009). Specific objections are:
  • • The explicit provision for imprisonment of seafarers in contravention with Clause 230 of the United Nations Conference on the Law of the Sea (UNCLOS), notwithstanding verbal assurance that Crown Prosecution would be instructed not to contravene international conventions.
    • Extension of provision for imprisonment to shipping company management and ownership
    • A reverse onus of proof on the accused to have exercised due diligence.
    • Lack of requirement for the Crown to prove guilt – only that an event occurred.
      
• At its 54th session in March 2006, the IMO MEPC emphasized the importance of adequate reception facilities in the chain of implementation of the MARPOL Convention, and stated that the policy of "zero tolerance of illegal discharges from ships" could only be effectively enforced when there were adequate reception facilities in ports. Therefore the Committee urged all Parties to the MARPOL Convention, particularly port States, to fulfill their treaty obligations to provide reception facilities for wastes generated during the normal operation of ships. The Committee also agreed to develop a port reception facility database (PRFD) as a module of the IMO Global Integrated Shipping Information System (GISIS).
  
  COSBC urges the Government of Canada to ensure funding is allocated to provide for Canadian compliance with this convention in full.
  
• Given the sensitivity of Canadian coastal waters to invasive species, COSBC urges the Government of Canada to ratify the 2004 IMO Ballast Water Convention. For the convention to come into force, 30 countries representing 35% of world tonnage need to ratify.