Climate Change, International Shipping and Market-Based Measures

Abstract

International shipping carries around 80 percent of global trade by volume and produces between 1.6 percent and 3.7 percent of GHG emissions. However, projections indicate that in 2050 there will be an increase of between 50 and 250 percent, becoming between 12 and 18 percent of GHG emissions. Hence, a global approach to improving energy efficiency and effective emission control is needed. Since emissions from international shipping are being produced principally in high seas, states find it particularly difficult to regulate. International shipping emissions were not included in the United Nations Framework Conference on Climate Change (UNFCCC). Excluded also in the Montreal Protocol, the international shipping industry was, however, incorporated in the Kyoto Protocol. However, until 2011 it was the only mode of transport for which GHG emissions were not regulated. The Kyoto Protocol (art. 2.2) left measures to reduce these emissions to the International Maritime Organization (IMO) and in the meeting of July 2011, after an intense debate, its Marine Environment Protection Committee (MEPC) adopted the Energy Efficiency Design Index (EEDI) for new ships. The EEDI is supposed to foster innovation and technical development of all the elements influencing the energy efficiency of a ship, in order to promote the design and produce more energy efficient ships. This is a different approach when compared to the Kyoto protocol, where a market-based measure (MBM) was adopted. In this paper we will analyze the works of the MEPC, particularly the possibility of introducing MBM in the fight against GHG emissions in international shipping.