In the context of COP28, the question of national, economy-wide climate action is again in the spotlight. Yet while shipping is clearly a fundamental part of national economies, most national climate plans given to the UNFCCC still do not include action on each country’s share of shipping emissions. Meanwhile, as the EU’s climate laws have shown, regional and national policy is key to chart a course for sustainable shipping worldwide.

Building on our analysis from COP27, this paper looks into depth at the policy measures available to address shipping emissions at national level. We display, for the first time, shipping emission profiles for countries with the administrative and economic capacity to regulate their share of shipping emissions. We find that the USA alone gives a subsidy of €1.4 billion to its shipping industry, while China currently awards just under €1 billion in subsidies. To address these emissions, we display the policy measures that can be used by these and other states to take action on their shipping emissions.

In the context of the COP28 negotiations, the issue of national action on shipping emissions is once again at the fore. Most states have not included shipping emissions within their national climate plans to the UNFCCC (nationally determined contributions, NDCs) arguing that shipping (and aviation) are not subject to the Paris Agreement. T&E has elsewhere debunked this argument. At the same time, in initial drafts of the COP28 conclusions countries have been invited to scale up ocean-based climate mitigation action.

The UN body addressing maritime issues, the International Maritime Organization (IMO), agreed in 2023 to climate targets, but the proposed legislative timeline makes the proposed emissions cuts impossible to achieve without action by states outside the IMO.

The EU has, therefore, stepped up with climate mitigation actions on shipping emissions. In 2023 European states agreed to a set of laws to reduce shipping emissions notably through its carbon pricing mechanism (ETS) and by a green fuels mandate (FuelEU Maritime). In this analysis, we analyse the shipping emissions profiles of other states and the possible measures that these states can take to mitigate shipping’s climate impact.

This paper has set out the shipping pollution profile of selected developed countries and demonstrated concrete policy actions they can take to address these emissions. Given that there are a limited number of ships in the world, whose main destinations are limited to a few large economies, there is a clear need for these countries to put in place policy measures to address shipping emissions.

As demonstrated, there is a broad suite of policy options at hand. These range from green fuel mandates, mandatory energy efficiency requirements, speed reduction, fossil fuel/greenhouse gas pricing and other measures. Potential revenue, for example through pricing pollution in carbon markets, will also be important to address the impacts of pollution whether they be on health or the environment locally or globally. These revenues can also be used in part to support shipping decarbonisation, as has been shown by the EU’s Innovation Fund and Norway’s Enova. In the US alone, €1.4 billion euros is currently awarded as an indirect subsidy to the shipping industry each year. In China, this amount is €0.95 billion euros and these amounts will go up as each country’s carbon price increases.

There is therefore ample opportunity and need for the countries to take action now on their shipping emissions. This should start through putting in place an emissions monitoring and reporting law that could be modelled on the EU’s and on top of which other policy measures can be implemented.
Source: European Federation for Transport and Environment