Minister Harakka: Winter navigation to be taken into account in EU emissions trading proposal

Minister of Transport and Communications Timo Harakka has sent a letter to European Commission Executive Vice-President Frans Timmermans concerning emissions trading in maritime transport. Minister Harakka stresses that the special circumstances related to winter navigation should be taken into account in the Commission's proposal for emissions trading, and the proposal should also include an assessment of its impacts on the relative competitiveness of Member States.

The proposal of the European Commission to be published on 14 July 2021 will extend emissions trading to maritime transport as part of the Fit for 55 climate package. Finland has made efforts to influence the upcoming proposal in such a way that emission reductions will be achieved while also taking into account the relative competitiveness between countries and special circumstances related to winter navigation. At the moment it seems that the Commission will not take Finland's perspectives into account.

"Due account for the special characteristics of winter navigation is an absolute necessity to ensure both the safety of transport operations and relative competitiveness. We are demanding this special attention because our distances and climate conditions are facts that cannot be changed by any regulatory frameworks," Minister of Transport and Communications Timo Harakka says. 

"If the special characteristics of winter navigation are not taken into account in emissions trading for maritime transport, the costs for Finland will be huge, and the competitiveness of our export sectors will also be seriously weakened," Minister Harakka says. 

By ignoring winter navigation and ice-classed ships the EU would deviate from international regulation. The safety aspects of winter navigation and equitable operating conditions relative to other maritime transport have been taken into account, for example, in the energy efficiency rules of the International Maritime Organization IMO.

Maritime transport is vital for Finland: about 85% of our total foreign trade and 95% of our goods trade with other EU countries rely on maritime transport.

Ice-classed ships combine environmentally safe and logistically efficient maritime transport

Under the EU's emissions trading scheme the operators must, on an annual basis, acquire and return emission allowances corresponding to the volume of their emissions. Emission allowances can also be bought and sold. The operators are driven to reducing their emissions by gradually decreasing the total quantity of emission allowances.

What Finland is worried about in the Commission's proposals is that it will guide the shipping companies to using weaker vessels just because they are more energy-efficient and produce less emissions. Such vessels are not intended for harsh icy conditions and they need more icebreaker assistance. This will not decrease emissions on the transport system level, and the likelihood of oil and chemical spills in wintertime would increase. 

About 70-80% of visits of ships to Finnish ports from foreign ports are made by vessels in the best ice classes. Heavy ice-strengthened vessels inevitably consume more fuel and produce more emissions even when sailing in open water. These vessels obviously need more power when navigating in ice.

Next steps

The EU's emission reduction target by 2030 has been tightened from 40% to 55%, compared to the level in 1990. To achieve this target, the Commission has drawn up a Fit for 55 climate package that is to be published on 14 July 2021. The package will include a proposal for emissions trading in maritime transport and several other proposals concerning the transport sector. The current estimate is that the earliest time when emissions trading could be started is in 2025-2026.

Inquiries:

Minister of Transport and Communications Timo Harakka, requests for interviews: Marjo Jäppinen, Head of Communications, tel. +358 40 080 4730

Eero Hokkanen, Ministerial Adviser, Ministry of Transport and Communications, tel. +358 50 476 0401, eero.hokkanen(at)lvm.fi, Twitter @eerohokkanen