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Abstract
The shipping industry, although relatively carbon-efficient, is projected to produce rising carbon emissions in the future as a consequence of increasing world trade. A number of candidate regulations designed to mitigate these emissions have been canvassed by the UN’s International Maritime Organisation and by the European Commission. Many of these schemes are focussed on the use of market measures—emission trading schemes or fuel levies. This paper draws on observational and interview data gathered to examine enforcement issues associated with the control of ships’ sulphur emissions in order to consider the possible enforcement problems that might be associated with projected market measures to control ships’ carbon emissions. Enforcement problems are shown to be associated with the globalised character of the industry and its polycentric governance structure.
Highlights
The topic of controls on carbon emissions from the shipping industry has received relatively little public policy attention, international shipping’s greenhouse gas emissions are greater than the total emissions of many countries, including for example, the UK [1]
It is in this context that we investigate the use of market-led tools for the effective governance of carbon emissions from the shipping sector
While large ship operators might conduct the purchase of surplus credits in-house, most operators would probably contract out such work to specialist brokers who would charge a fee for their services. Such third-party charges will always be unpopular in shipping company offices, especially so when maritime freight rates have fallen and many companies are losing money: “...in the examples that were given to us, there seemed to be so many other additional parties involved that the cost of administering such a system seemed illogically high [...]” [shipping industry representative interviewee]. Beyond these generic difficulties associated with ETSs, there appear to be a number of further problems specific to a shipping ETS, namely those of the “responsible entity”, of flag-State allocation, verification and enforcement, of reliance on the Bunker Delivery Note for evidence of fuel consumption, and of variation in Port State Control practice
Summary
The topic of controls on carbon emissions from the shipping industry has received relatively little public policy attention, international shipping’s greenhouse gas emissions are greater than the total emissions of many countries, including for example, the UK [1]. For example, while the climate regime of United Nations Framework Convention on Climate Change (UNFCCC) is based on the key principle of “common but differentiated responsibility”, the IMO is driven by the principle referred to as “no favourable treatment” This norm difference continues to cause blockages in negotiations over emission reductions from the shipping sector, making it difficult to integrate climate change regulations into sector policy [3]. While the IMO has developed a regulatory framework for international shipping, it does not directly enforce its regulations [31] It is in this context that we investigate the use of market-led tools for the effective governance of carbon emissions from the shipping sector. Following a report of the methods of the study, the paper considers, firstly, the enforcement problems of regional and global emissions trading schemes for the shipping industry, and secondly, the enforcement problems of a regional and a global fuel levy
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