The Shipping Industry’s Pollution Problem Part II: A Lack of Authority

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By Adam Sarvana, DC Bureau

Part II in the four-part series No Safe Harbor about the shipping industry’s emissions problems

Although the original shipping emissions standards established in the MARPOL treaty went into effect in 2005, they were written in 1997, and getting the more stringent 2008 revisions past the onerous International Maritime Organization (IMO) regulatory process was a battle that exhausted the few environmental groups that even engaged in the first place. Furthermore, the rules still do not address CO2 or other global warming risks, and some observers fear it is now too late to make a push to change the rules again.

“When you look at that slow track” of revising the NOx and sulfur limits, said Jackie Savitz, a campaign director with the ocean-focused activist group Oceana, “in terms of global warming pollution we can’t have another twenty-year process. We don’t have that time to wait. So we’re pessimistic that the IMO will be the way to control global warming emissions from ships.”

But waiting has become standard for activists in this arena: the environmental provisions of MARPOL only became enforceable in the U.S. in January of this year, with the passage of the Act to Prevent Pollution from Ships.

Those global warming emissions, setting aside the health impact of sulfur and nitrogen output, are themselves considerable ─ and they are growing. The April report prepared for the IMO’s environment committee, officially titled Second GHG IMO study 2009, found that combined domestic and international shipping accounts for about 3.3 percent of the world’s total CO2 emissions, more than railroad freight (0.5 percent) and airlines (1.9 percent) combined.

Unfortunately, the report noted that the interaction of black carbon with snow melt “has not yet been calculated for ship emissions,” a glaring omission when viewed alongside the mounting evidence that black carbon is second only to CO2 in its global warming impact. According to an April 15 article in the New York Times on Third World sources of black carbon, the substance accounts for about 18 percent of the planet’s warming, while CO2 accounts for about 40 percent. No other pollutant comes close.

For many countries concerned about the industry’s impact on the health of their citizens, this lack of information is hardly satisfactory. The Environmental Audit Committee of the UK’s House of Commons recently decided to examine shipping emissions in more detail. Its final report, Reducing CO2 and other emissions from shipping, published in May, was damning: it called the shipping industry irresponsible, the IMO a feckless waste of resources, and its own government woefully unprepared to face the danger.

“[T]here can be no excuse for the lack of progress within the IMO in the years since the Kyoto Protocol was signed,” the report concluded. “That the IMO has yet to reach agreement even over the type of [global warming] emission control regime to take forward, let alone decide any details — much less bring any scheme into implementation — suggest that it is not fit for purpose in this vital area.”

Taking a swipe at the idea that quantifying emissions is too difficult, the report stated, “It is perfectly feasible to track the emissions of individual ships, given they are obliged to keep their fuel receipts, and that it is straightforward to calculate CO2 emitted from fuel consumed. … Most of all, ships must physically enter a port at some point; it is not as though this were an industry beyond the control of individual governments.”

There is legitimate uncertainty, however, about just how much control individual governments really have.

Shipping is an odd business because, even more than airlines, shipping companies are by definition regional or global rather than strictly national entities, with interests extending well beyond the borders of any one country. This has given rise to a phenomenon almost without parallel in the modern economy whereby shipping firms choose each ship’s official country of registration — under whose tax, environmental and labor laws it will be governed — based on little more than a whim, a practice so common it has a name: flags of convenience. (The Somali pirate drama that played out on television earlier this year was centered on a Møller-Mærsk liner flagged in the U. S. and ultimately rescued by the Navy. The company flags other ships in its fleet elsewhere around the globe.)

Despite being small and economically underdeveloped, the three largest registrars of commercial shipping worldwide are Panama, Liberia and the Bahamas. Greece is also among the largest markets and is home to many of the world’s most significant owners of shipping lines (and the current IMO head, Efthimios Mitropoulos). A market for shipping registration is now growing in, of all places, Mongolia, which enjoys the hard currency that such business can generate despite the fact that the country lacks a coastline.

Whatever the British government’s reservations about the IMO’s ability to regulate its members, the industry itself is largely in favor of the idea. Bryan Wood-Thomas of the World Shipping Council (WSC) stressed multiple times during an interview that shippers strongly prefer uniform, worldwide environmental standards to anything resembling a global patchwork. Asked whether the Council supports a recent joint U.S./Canadian request for the IMO to create a large emissions control area (ECA) along each country’s coastline, his answer quickly veered to the bigger picture.

“One of the worst things that can happen to us is regulations appearing unilaterally or regionally, because it creates a chaotic environment to move in,” he said, emphasizing that much of the industry is actually in favor of the request because it is being conducted through the international auspices of the IMO rather than on each country’s own terms. (A Møller-Mærsk representative gave a similar answer in a written response to e-mailed questions.)

He returned to the point later, with a slightly different take: “If shipping is regulated uniformly through a global agreement, then there’s no competitive disadvantage [for any particular country]. More progressive companies will say, ‘That’s just the cost of doing business.’ If you fail to have a global agreement, you have a chaotic regulatory environment that’s more difficult and expensive to operate in.”

Although there is little for shipping lobbyists to do on the environmental front in Congress, since no one is threatening to write a new law, a few legislators are willing to carry the industry’s flag if necessary. During the 2008 hearing on Sen. Barbara Boxer’s emissions bill, Sen. David Vitter echoed the industry’s call to wait for a single global standard:

“Marine vessel emissions are a global issue, and should be addressed from a global perspective. The U.S. has already submitted a proposal for stronger emissions standards to the International Maritime Organization, and they are currently examining it as an option. Supporting S.1499 would push the U.S. toward unilateral action, rather than global cooperation.

"… Rather than create a blanket, one-size fits all approach for both areas in attainment and non-attainment, I am interested to hear more about proposals that have come up through the IMO negotiations[.]” Vitter, it should be noted, received a $1,000 contribution in the 2008 election cycle from the Maersk Inc. Good Government Fund, the political action committee acting on behalf of Møller-Mærsk in this country.

When it comes to cracking down on shipping pollution, almost everyone involved in these issues knows what needs to be done. Savitz, of Oceana, echoed many sources (including Wood-Thomas) interviewed for this story when she laid out the difficulties in getting poorer countries to agree to strict international environmental regulations that could impact their own emerging economies.

“Under Kyoto, there’s ‘developing’ and ‘industrialized’ countries, and we have ‘common but differentiated responsibilities’ under which the two types don’t have the same [environmental] requirements,” she said. “If your ships are flagged or owned by developing countries, they don’t feel they should have to abide by the same regulations” as those of highly economically developed nations like the United States.

John Kaltenstein of Friends of the Earth agreed, pointing out that while some small countries have actually ratified more environmental treaties than the United States (which was never a party to Kyoto), the key question is enforcement.

“Issues on the high seas outside any country’s waters,” such as emissions and waste dumping, “are resolved by the regulations of the flagging country,” he said. “It’s up to the flag state to penalize [a company] or whatever is called for. Other countries are powerless outside their waters if the flag country won’t enforce.”

David Marshall of the Clean Air Task Force put it most succinctly:

“Right now they’re deadlocked at the IMO between developed and developing countries over whether standards should apply only to developed countries.”

This is particularly salient when it comes to Arctic emissions of black carbon, which are so far completely unregulated. What more can these small, economically dependent countries do? Some countries are more interested than others in addressing these issues. But the question is perhaps better directed at the companies themselves, since the countries involved generally do not own the ships or provide the crew.

Savitz pointed out that merely reducing a ship’s speed is one simple step with a large upside ─ a 2000 IMO study found that cutting the speed of all ships worldwide by only 10 percent would lead to a 23.3 percent reduction in their CO2 emissions. (“Think about what we’d have to do to reduce CO2 by 23 percent from power plants,” she said. “With ships you can just take your foot off the gas.”) Other potentially beneficial steps, some of which Wood-Thomas pointed to as promising money-savers for the industry, include more efficient hull design, route optimization to avoid bad weather, better ship maintenance and switching to lower-sulfur fuels. The April IMO report on greenhouse gases said that taken together, these and other suggestions could cut global shipping CO2 emissions between 25 and 75 percent.

The low-sulfur fuel option is attracting particular attention, especially in light of the recent joint U.S./Canadian petition to create a gigantic ECA along the entire Atlantic and much of the Pacific coastline (with the odd exclusion of much of Alaska). Although neither country actually flags many ships, the U.S. is such a major importer of shipped goods that it has the power to drastically affect the global market. Many ships, at one point or another, will dock at a U.S. port, and if the ECA is granted by IMO voting members next year, it will mean that most ships will have to carry at least some low-sulfur fuel on board, although as Kaltenstein of Friends of the Earth pointed out, even if the proposal is granted, “If you sail from Asia to the U.S., only a small part of that trip would require low-sulfur fuel.” Outside the ECA, only the weaker global standards would apply.

Complying with the potential new American ECA, which would include NOx, SOx and PM2.5, may be a bigger or smaller challenge depending on whom you ask. Technically speaking, switching from bunker fuel to low-sulfur distillate mid-voyage is not difficult, and is already done routinely by ships around the world to comply with existing regulations. However, Wood-Thomas of the WSC and Joseph Cox, president of the Chamber of Shipping of America, which focuses on companies that do a large amount of their business in the U.S., both argued that the future availability of low-sulfur fuel may be a problem.

“There’s a fair degree of confidence that low-sulfur fuel will be available [in the U. S.] in 2015,” Wood-Thomas said, “but the broader question is, can you get it in Singapore or Hong Kong? That’s difficult to project. Various specialists would give you a report with all sorts of question marks.”

Despite this uncertainty, many governmental and activist observers say creating a large new ECA around the world’s biggest economy would not only go a long way to improving American air quality but could expand the very low-sulfur fuel market the industry now fears is too small to allow compliance. This would have a global ripple effect that could literally mean the difference between life and death for tens of thousands of people living near major shipping lanes. Indeed, although everyone agrees that there is currently not enough low-sulfur fuel for all ships to use at all times, Kaltenstein suggested that anyone who questions the viability of strict standards is looking only at the short term.

“The shipping industry argues there’s not enough low-sulfur fuel to go around,” he said, but “you need a rule to create the demand for low-sulfur fuel. It won’t just happen organically.”

Originally, the IMO allowing for the creation of ECAs was an incremental measure that fell short of some activists’ hopes for a strict worldwide sulfur limit, he said ─ a step that made better sense than everyone simply resigning themselves to the small amount of low-sulfur fuel and leaving it at that. But now, he said, the time has come to go beyond ECAs.

“Land-side pollution sources have received more pressure to clean up, like power plants and refineries,” he said. “Fuel sulfur in trucks is 15 ppm now, and bunker fuel averages 27,000 ppm ─ that’s a tremendous difference.” The industry’s global warming potential is of particular concern: Kaltenstein pointed out that even switching to low-sulfur fuel “doesn’t necessarily get at black carbon.”

Speaking of pressure to clean up, how has the EPA responded to the challenge of regulating shipping? Not well, according to multiple sources.

Sarah Burt, of Earthjustice, recounted a decade-long legal battle over whether to regulate shipping emissions domestically, a battle that continues to this day. Under the Clean Air Act, the EPA was supposed to issue some sort of regulation in 1992, a deadline that it ignored. By 1999, Earthjustice concluded that the EPA was never going to get its act together, so it filed a lawsuit that resulted in a settlement agreement to put out a regulation by 2003. The resulting rule did no more than codify the status quo lack of any emissions limit alongside a promise to publish a real cap by 2007 ─ an unusual “rule” by any standard that was nevertheless upheld by the D. C. Circuit Court in Bluewater Network v. EPA.

In Burt’s telling, “the 2007 deadline came and went, and we sued again [in the D. C. district court] in October 2007 because they’d missed the April [2007] deadline.” In December 2007 the agency put out a rule changing the deadline to December of 2009, hardly standard content for a federal rulemaking procedure.

Why was this done? Burt described it as “a procedural stunt whereby we were in the wrong court” to sue. Under the Clean Air Act, an outside party challenges a failure to make a rule in district court; if the EPA puts out a rule the party questions, they have to take the matter to the circuit court. Since the agency had promulgated a rule, no matter how meaningless, the lawsuit against the 2007 suit had to be dismissed ─ a process that Burt called “part of how the EPA is pulling out all the stops not to have any scrutiny over [shipping] regulations.”

Despite this record of double-dealing, Burt said, “Now we’re going to take them at their word and see what regulations they promote in December.”

They won’t even have to wait that long. The agency in June formally proposed a new national rule under the Clean Air Act that would only apply to new U.S.-flagged ships, leaving foreign vessels off the hook. The rule would go into force in 2011 and would, according to the agency’s announcement, “require more efficient use of current engine technologies,” resulting in an estimated 15 to 25 percent reduction in NOx emissions below current levels. (In 2016, the rule would stiffen to require more effective exhaust treatment, reducing NOx by 80 percent below current levels.) It would also set new limits for hydrocarbon and carbon monoxide emissions and forbid the production or sale of ship fuel with over 1,000 ppm of sulfur inside the ECA, essentially enforcing the IMO standard and no more. The proposal will not be finalized, in whatever form, for months.

(Originally published at


See also:

The Shipping Industry’s Pollution Problem Part I: Low-Hanging Fruit

The Shipping Industry’s Pollution Problem Part III: Off The Hook

California Fights Shipping Pollution As International Shippers Push Back

(Photo: Flickr/monstermunch/CC BY-SA 2.0; Map: EPA)