London-based Simpson Spence Young (SSY) has launched a new service to secure carbon allowance procurement for clients ahead of shipping’s entry into the EU’s emissions trading system (ETS).
The world’s largest independent shipbroker has joined forces with carbon market specialists CF Partners, which operates one of the largest trading desks in the carbon compliance market.
“By forming this strategic partnership with CF Partners, we are able to offer a full EU ETS service, enabling our customers a smooth and simple route to market from the point of exposure to being fully compliant,” said James Ash, head of SSY’s carbon desk.
The EU ETS will require shipping companies to surrender allowances for 40% of verified emissions for 2024; 70% for 2025; and 100% for 2026 and beyond. As part of the ETS, all emissions emitted by vessels calling at an EU port for voyages within the EU, as well as 50% of emissions from voyages that start or end outside the EU, and all emissions at berth in EU ports, will be included.
In simple terms, the extension of the EU ETS to shipping means that a cap is set on the total amount of greenhouse gases that can be emitted by a ship, which is reduced over time. Shipping companies can purchase allowances, also known as carbon credits, to cover their fleets’ emissions. Fines will be issued to those exceeding their allowances and if unpaid or there is ongoing non-compliance, port authorities may detain a vessel or even exclude it from a port.
“The maritime sector is entering the EU ETS at a time of record EU allowance prices and significant market volatility, so companies that act early will be best placed to develop an effective compliance strategy,” said Tim Atkinson, head of carbon sales at CF Partners.
The new SSY service will enable procurement and warehousing of EU carbon credits, thereby alleviating the operational and regulatory challenges that operators would otherwise face as a consequence of the new legislation, the company said.
“It’s no secret that the road to decarbonization brings with it a number of key challenges with regulatory compliance being a significant challenge for many in the industry. Through our EU ETS compliance service, we are offering a real and practical solution for the shipping community as they continue to transition to a greener, cleaner future,” said Stanko Jekov, SSY managing partner.
In February, Wilhelmsen Ship Management (WSM) and shipbroker Affinity Shipping also teamed up to jointly establish an independent company that will provide compliance services related to the EU ETS.
source : splash247.com
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