055/17/Gen.Inf. Remarks on IMO’s reaction to the EU MRV Regulation

Nelson F. Coelho, Doctoral Researcher in International Law at Utrecht University, provides his insights on IMO MEPC 70 decision regarding carbon dioxide emissions from international shipping. Dr. Coelho attended the Committee as an observer and notes that IMO’s approach on collecting data for the CO2 emissions differs significantly from the EU MRV legislation.

The Marine Environment Protection Committee (MEPC) of the IMO had already approved, in its 69th session back in April this year, the setting of mandatory requirements for ships to record and report data on their fuel consumption. At the 70th meeting of this IMO organ, it was decided to adopt those requirements as modifications to MARPOL Annex VI. This decision is the first step of a roadmap through to 2023 that aims at developing a comprehensive IMO strategy on reduction of GHG emissions from ships. As a consequence of the entry into force of this roadmap, all vessels larger than 5000 GT will have to report fuel consumption starting 1 January 2019. This mandatory global data collection system represents an improvement in what regards shipping energy efficiency and will provide relevant information for any strategy to mitigate the carbon footprint of this industry. Still, this outcome cannot be fully understood without looking outside of the IMO setting. These negotiations were held under the shadow of EU Regulation 2015/757, whereby European Union member states decided that they will unilaterally, and as early as 1 January 2018, be monitoring shipping CO2 emissions. The question to be asked now is whether the MEPC 70 decision will succeed in pushing the EU legislation back into the drawer.

At the outset it must be noted that these two international organizations have very different agendas in what respects climate change. EU member states must respond to increasing internal pressures to do more to reduce their GHG emissions footprint (e.g. the Urgenda case in the Netherlands, and the Client Earth case in the UK). But most of the remaining IMO states however solely take into consideration the particular international commitment they have consented to under the UNFCCC Paris Agreement. The fact that some states parties to the IMO are EU member states may explain their negotiation strategies at the MEPC. Nonetheless, despite them being an active number of delegations represented at the IMO, their overall influence, albeit relevant, has proven to be less than decisive.

As a consequence of this MEPC 70 decision, Regulation 22-A will be added to MARPOL Annex VI. This Regulation on collection and reporting of ship fuel consumption data sets forth some steps to be followed by ships and respective administrations. First, the ship must collect the data. Then it must aggregate the data collected in each calendar year. Then it must report that data to the national administration. The administration then verifies the data received according to national procedures, which will follow IMO guidelines. Then the administrations will transfer the data into the IMO Fuel Consumption Database. It is up to the IMO Secretary-General to keep this information in an anonymized database and to report annually to the MEPC with a summary of the data gathered in this process. The data to be submitted includes, amongst few technical characteristics of the ship, the fuel consumption, by fuel type, in metric tonnes and methods used for collecting fuel consumption data as well as distance travelled from berth to berth, hours not at berth.

This approach differs from that set forth by EU legislation. The focus of the EU is put directly on the CO2 emissions and not just on fuel consumption or the efficiency of the ship. Also, companies are here expected to perform the calculations of such emissions themselves, following methods described in the Regulation. Companies can chose the method of their preference, as long as they use it consistently for each ship once chosen.

The type of the data collected is another point that greatly distinguishes both instruments. This is particularly sensitive because the obligation set forth by the EU legislation refers to far more information what will be collected under MARPOL’s new Regulation. The EU expects to have access to, inter alia, the name of the company, the name of the ship-owner, the port of registry, the annual CO2 emissions, the annual average fuel consumption per distance travelled, a description of the emission sources, such as main engines or gas turbines, and even to the ship’s revision record sheet. What is more, the Regulation mandates companies to obtain, record, compile, analyse and document monitoring data, including assumptions, references, emission factors and activity data, “in a transparent manner that enables the reproduction of the determination of CO2 emissions”.

That also signifies that the European Commission intends to make that data publicly available. As a safety valve, the Regulation does guarantee companies the right to manifest their wish to prevent disclosure of a particular category of the aggregated data to ensure protection of commercial interests; but this applies only as long as the information to be excluded does not relate to CO2 emissions. These rules about public disclosure have been drafted under the assumption that “public access to the emissions data will contribute to removing market barriers that prevent the uptake of many cost-negative measures which would reduce greenhouse gas emissions from maritime transport”. But despite efforts towards turning this mechanism a model for a global data collection system, the fact is that such assumption is not shared by most of EU member states’ IMO counterparts, which favoured a relatively less intrusive and less transparent approach to the information on CO2 emissions by ships.

The IMO global mechanism is therefore quite more sensitive to the shipping community’s data protection concerns than the instrument adopted by the EU. It remains to be seen how shipping companies will be adapting to the existence of concurrent mechanisms and also how EU member states will be using the information the European Commission gathers from shipping companies, both internally and in subsequent MEPC discussions. For now, and even if the EU had left the door open to review its instrument, its immediate reaction does not demonstrate any willingness to step back from its unilateral move. This means that for those companies shipping to EU ports in 2019, it is very likely that both instruments will apply.

Written by Nelson F. Coelho, Doctoral Researcher in International Law at Utrecht University

Above article has been written in the course of an internship at the International Maritime Organization, where the author has attended MEPC 70 as an observer.

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Thank you & Best Regards,

Eng. Dimitrios Nikolaos Spanos
Lead Maritime Auditor / Principal Surveyor
Member of IRCA, IIMS, ELINT, HELMEPA & Nautical Institute

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