Friday, September 12, 2008

Oh Ek

The European Parliament has voted for a report, drawn up by Lena Ek, which suggests that shipping should be included in the EU ETS. The UK has tended to favour action by the IMO instead.

To include aviation in the ETS it was agreed that the EU would tax all flights from or to the EU.

But in aviation the economics rule out diverting to a point near the EU border and then doing a shorter "hop" into the EU to artifically lower the ETS cost. It costs too much and takes too long to land and take off again.

How do you decide what counts as EU shipping? It can't be by registration (because even more would then register in Liberia).

So it would have to be some kind of charge per visit based on the size of the engine of the ship and how far it had travelled.

But in shipping, things being slower, there would probably be an incentive to divert to countries near the EU. Why pay tax for a whole journey from China to the EU, if you can pull up alongside in Morocco or Norway, and then only pay the tax from there the EU?

It's a tricky one - be interesting to see what they come up with. The green groups seem to favour a straight tax of some kind. One group is calling for "differentiated port charges, en-route charges and fuel taxes"

No comments: