New vessel efficiency incentive scheme developed

The World Shipping Council and the government of Japan have developed a refined Vessel Efficiency Incentive Scheme or EIS designed to stimulate significant improvements in the carbon efficiency of the world’s maritime fleet. The proposal would establish explicit efficiency standards for both new and existing ships in the world fleet. Vessel efficiency would be measured using the Energy Efficiency Design Index (EEDI) developed by the IMO. New and existing ships meeting the specified standards would not be subject to any fees or costs other than those associated with the design and installation of more efficient ship technologies. Those ships that fall short of the specific standards would be required to pay a fee (or penalty) that is based on the amount of fuel consumed and how far short of the standard the specific ship falls. The per-unit fee applied to each tonne of fuel would be adjusted based on the relative efficiency of the vessel. The EIS allows a ship to avoid recurring regulatory costs by meeting the standards established in the Convention. “This feature is unique to the EIS proposal and is significant as it provides an option in the marketplace for cost avoidance that is not available in a system that would impose a uniform levy or tax on all ships and all fuel purchases or in emissions trading proposals that require the purchase of emission credits,” a spokesman said.