The CBDR Principle and GHG emissions from International Shipping

Per Kågeson

GHG emissions from maritime transport

•1,046 Mt CO2 from shipping in 2007

•Approximately 3.3 % of overall global CO2 emissions

•870 Mt CO2 from international shipping that are not domestic and not part of the national inventories

•Large potential for efficiency improvement

•Slow replacement of ships

Market-based measures

• IMO has discussed different types of market-based measures for curbing CO2 emissions, among them:

1. Emissions trading under a global cap

2. A levy on bunker fuel for financing purchase of emission credits to offset any emissions of CO2 above a baseline

Common but Differentiated Responsibility

• Principle 7 of the Rio Declaration and Article 3.1 of UNFCCC

• Legitimizes asymmetry of commitments by putting most of the burden on the rich

• Conflicts with the obligation of States not to damage the environment beyond their own territory

• Does not define the border-line between developed and developing countries

The CBDR and equal treatment of ships

• China and India (among others) interpret CBDR to mean that ships registered in developing countries should be exempt from any MBM or be fully compensated for the impact on their economies (no net incidence)

• Existing IMO treaties are based on equal treatment of ships

• ¾ of all ships belong to Annex I companies but most of them carry flags of developing countries

Global application

• For full compensation of all non-Annex I countries 1/3 – 1/2 of the revenues from a global CO2 levy or from auctioning emission allowances would have to be allocated to the developing countries

• This may be difficult to achieve in the case of the levy as its main objective is to fund the purchase of emission credits to offset any emissions above the cap

A stepwise regional solution

• A scheme endorsed by IMO and UNFCCC that is open to voluntary participation by states and ports

• An IMO/UNFCCC scheme covering all traffic to ports in Annex 1 countries

• An IMO/UNFCCC scheme that gradually expands to include traffic to countries when their income per capita exceeds a certain pre-defined level

CBDR when application is limited to Annex I

• Only a minor part of arriving ships would come from developing countries and they would typically carry goods intended for use in the industrialized countries

• Journeys to developing countries would not be covered

• A small part of the proceeds could be used for compensating, in particular, LDCs.

Differentiation of responsibility

• All developing states are not equally poor

• Some non-Annex I countries have higher GDP per capita (at PPP) than the “poorest” among Annex I countries had in 1997 (when signing the Kyoto Protocol)

• Saudi Arabia, Korea and Singapore are rich countries. China has a higher GDP/capita than Ukraine

Taking account of accumulated emissions?

• The exact relevance of historic emissions is unclear

• Part of these emissions occurred when the risk of climate change was not yet known

• Some occurred due to mismanagement and lack of democracy in the former communist countries

• Leapfrogging allows developing countries to advance fast (and at comparatively low GHG emissions)

Need for sustainable compensation criteria

• The exact grounds for compensation should be clarified.

• The basic choice is between distinct categories (Annex I or non-Annex I) and parametric values such as CO2/capita and GDP/capita.

• Another main issue is the duration of the compensation.

Thanks for your attention!

Per Kågeson

kageson@kth.se