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Shipping execs advocate carbon levies

Singapore - Executives at some of the world’s top shipping groups are advocating a levy on carbon emissions on shipping in an effort to shape tightening rules on greenhouse gas emissions.

Singapore - Executives at some of the world’s top shipping groups are advocating a levy on carbon emissions on shipping in an effort to shape tightening rules on greenhouse gas emissions while providing a means to fund development of cleaner fuel sources.

“To meet international shipping’s decarbonization challenge, the maritime industry needs a carbon levy, it is coming, and we should shape it,” said Andreas Sohmen-Pao, chairman of BW Group at the Global Maritime Forum in Singapore this week. The comments followed closed working group discussions on the need for a levy on carbon emissions from shipping operations with other executives from other companies including Cargill Ocean Transportation, Euronav, Angelicoussis Group, Torvald Klaveness Group, Norwegian bank DNB and mining giant BHP. Maritime shipping, which represents about 90% of international trade, accounts for about 2-3% of global carbon dioxide (CO2) emissions.

The U.N.’s International Maritime Organization (IMO) has a goal to cut greenhouse gas (GHG) emissions by 50% from 2008 levels by 2050. Immediate action is needed if the global shipping industry is to meet this target, the International Renewable Energy Agency (IRENA) said in a report released this week. [nL3N27E2SK] In the absence of suitable mitigation policies, GHG emissions associated with the shipping sector could grow between 50% and 250% by 2050, it added.

But how to achieve this remains unclear as alternatives to fossil fuels, such as biofuels and hydrogen-based solutions, remain uneconomical and require significant infrastructure investments and technological advances, the report said. “We have an opportunity to shape a new maritime future, create a new business opportunity and drive innovation,” said Sohmen-Pao. The IMO will introduce tougher rules on the sulphur emissions in January as part of regulatory steps to clean up shipping.

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