Union MRV enters into force before global MRV

Union MRV enters into force before global MRV

Union MRV enters into force before global MRV

By Helena Athoussaki, Chief Strategist and CEO of IMAREM

Despite the good progress of IMO negotiations on a global data collection system including CO2 emissions, the European Union moves quickly with the adoption of a Regulation which enters into force on 1 July 2015 and aims at establishing an EU-wide system for monitoring, reporting and verifying (MRV) emissions from large ships using EU ports.”

According to the latest IMO GHG study, international shipping has reduced its total CO2 emissions by more than 10% between 2007 and 2012. The same study forecasts however shipping CO2 emissions to increase by 50% to 250% by 2050, which would then represent a substantial part of the total global emissions.

On 24 October 2014, EU leaders agreed on an EU-wide target of an at least 40 % domestic reduction in greenhouse gas emissions by 2030 compared to 1990 levels.

Maritime shipping remains the only mean of transportation not included in the Union’s reduction commitment. In June 2013 the European Commission set out a strategy for progressively integrating maritime emissions into the EU’s policy for reducing its domestic greenhouse gas emissions. The first step of the strategy is the monitoring, reporting and verification of CO2 emissions from large ships using EU ports.

On 28 April 2015, the European Parliament endorsed the system for Monitoring, Reporting and Verification of CO2 emissions from large ships using EU ports as a first step before any market-based measure, efficiency standard or other measure is applied.

According to the EU the introduction of a robust Union MRV system is expected to lead to emission reductions and to provide ship users with aggregate and transparent data identifying the most fuel-efficient vessels, enhancing the competitiveness within the sector, with new technologies and operational measures adopted to improve efficiency and lower operational costs.

The shipping industry is disappointed by the Parliament’s vote since there was very good progress in the last MEPC 68 meeting on global data collection system including CO2 emissions.

It is noteworthy that during that meeting, the Marshal Islands called on IMO to step up its efforts towards the climate change crisis and asked for a carbon reduction target in shipping, an issue which was extensively discussed but not delivered.

Furthermore, the shipping industry is concerned with the publication of commercially and operationally sensitive data and it is claimed that the activity data requested is related only to the past commercial utilization of a ship and thus serves no value for assessing ship’s future performance capability.

There are many challenges that EU may encounter in implementing an MRV system and introducing uniform rules. The system must (a) fully align with a global system in case IMO comes with a global data collection system prior to the first monitoring year 2018 and (b) be applicable to reflect the international nature of shipping, the ownership of the fleet as well as the complex and highly technical nature of the sector.

The proposed MRV might involve a certain level of administration complexity due to its reporting procedures, the information templates and the various parties involved requiring from ship owners and operators to design an effective risk free MRV management system.

Concluding and on the positive side, the MRV system could be a good platform for self-assessment and improvement as it well known that you cannot reduce something without measuring it first.

How EU MRV works

The Union MRV Regulation creates an EU-wide legal framework for collecting and publishing verified annual data on CO2 emissions and energy-efficiency related information from all ships over 5 000 gross tons that use EU ports, regardless of their flag or ownership

From January 2018 onwards, companies will have to monitor and report the verified amount of CO2 emitted by their large ships on voyages to, from and between EU ports. Companies are also required to provide certain other aggregated annual information, such as data to determine the ships” energy efficiency.”

The activity data falling under the scope of the Regulation that shall be reported is:

the fuel consumption and the resulting CO2 emissions;

The sailed distance;

The steaming time;

The time at berth or anchorage; and

The transported quantity of cargo.

There are 4 accepted monitoring methodologies for estimating the CO2 emissions.

Bunker Fuel Delivery Note (BDN) and periodic stock takes of fuel tanks

Bunker fuel tank monitoring on board

Flow meters for applicable combustion processes

Direct emissions measurements

Companies are flexible to use a combination of these methodologies, if this enhances the overall accuracy of the monitoring.

A ship-specific monitoring plan and the annual emission report will be subject to verification by accredited verifiers. Companies shall then submit the verified documents to the European Commission and the Flag States which are held responsible for ensuring the enforcement of the MRV (possibly Port Authorities under the existing Port State Control regime). In the case of ships having failed to comply with the Regulation, the option of detention or expulsion may be enforced.