Environment - Reducing Shipping Greenhouse Gas Emissions (port-based incentive schemes)


(www.MaritimeCyprus.com) This report reviews port-based incentive schemes to reduce shipping emissions, such as environmentally differentiated port fees. Greenhouse gas emissions from shipping currently represent around 2.6% of total global emissions, but this share could more than triple by 2050. Ports have a crucial role to play in facilitating the reduction of shipping emissions, alongside the ship operators themselves. Which incentives are currently used? What are their impacts? How could positive effects be increased? The report also explores lessons learned that could inform international negotiations on the reduction of shipping greenhouse gas emissions.

Many of these measures focus on ship design and operations. However, ports also have a crucial role to play in facilitating the reduction of shipping emissions. This report assesses the extent to which financial incentives at the port level could provide important lessons for the design of decarbonisation policies for the maritime sector. It identifies the port-based incentives currently in place, explores their features and assesses their impacts. Importantly, it explores how the experiences with existing measures could inform international carbon-reduction negotiations for shipping and help to increase the effect of port-based environmental incentives.

A number of port-based financial incentives to mitigate emissions are already in place today. The most common financial incentive used is the environmentally differentiated port fee. This is applied in approximately 28 of the 100 largest ports in terms of total cargo volume handled (in tonnes) and container volumes handled (in standard containers, or TEUs). In practice, this takes the form of a reduction of port fees for ships that are considered environmentally friendly, usually based on an index related to ship characteristics. Some US ports have introduced financial incentives for ships reducing speed when approaching the port. The Panama Canal Authority has a scheme that provides priority slot allocation to greener ships. Spain includes environmental incentives in the tender and license criteria for the towage services provided in ports. Shanghai has an emission-trading scheme in which ports and domestic shipping are included and in Norway an NOx tax is in place.

Despite the prominent place of such incentive schemes, very little is known about their actual impact. Public information on how many ships use these schemes is scarce and there is no port that has proven GHG emission reductions as a result of such policies. The only scheme for which serious impact studies exist is the vessel speed reduction scheme in Los Angeles and Long Beach in the United States.
The dearth of data notwithstanding, it is clear that the impact of port-based incentives on global shipping emissions is marginal. The number of ports deploying financial incentives is still fairly low and where they are applied only a handful of ships are benefitting from the schemes – often less than 5% of the ships calling the port. Moreover, the difference in fees for the dirtiest and cleanest ships is usually small, normally in the order of 5% to 20%. Currently only five ports use indices in which GHG emissions provide a substantial part of the index criteria. Any incentives ship-owners may currently have to order more efficient ships with lower emissions can only to a very small extent be a result of savings from port-based incentives.

Yet, ports clearly play a hugely important role in helping the shipping sector to manage the transition to clean shipping. Port-based incentives for GHG emission mitigation could provide an important supporting role. The first lesson learned therefore is that ports are players in this context, and that they are taking actions - to both incentivise cleaner ships and to increase the efficiency of their operations, which can also have an effect on shipping emissions. Furthermore, the existing port-based measures establish that market interventions are needed to reward clean performance. The fact that financial incentives have been chosen implies there is support for flexible measures to drive behavioral change.

However, more emphasis is needed on monitoring, reporting and verification of the impacts of these measures. More could also be done to enshrine the “polluter pays” principle. Higher rates of differentiation between vessels based on their environmental performance could drive more and faster change. It is possible within the policies to differentiate fees according to type of vessel enabling the economic activities that can afford to pay to take more of the responsibility for acting.

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Source: International Transport Forum


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  1. Pors need to have facilities to give vessels electrical power. So after - ALL FAST- stop all vessels equipment(MOTORS) and connect to shore power. No emission from vessels in ports. As tankers has IG plant even this has to be supply by port.