I thank the committee for its invitation to discuss our decarbonisation strategy for the shipping and aviation sectors. Both are vital to our island’s international connectivity and competitiveness but their decarbonisation is highly complex and both are rightly recognised as hard-to-abate sectors. Opportunities for significant emissions abatement will ultimately rely on alternative fuels and for emerging technology pathways to mature and scale. Given the international nature of these sectors, it is essential that we pursue a partnership and commonly negotiated approach to each sector’s decarbonisation. At a European level, this is done through the EU’s Fit for 55 legislative package. At an international level, it is done through forums such as the International Maritime Organisation, IMO, and International Civil Aviation Organisation, ICAO.
While a combination of national, regional and global targets will be needed to plot a sustainable pathway towards decarbonisation, it will be global measures that provide the best opportunity for achieving sector-wide environmental and emissions abatement goals.
Ireland’s long-term strategy for the reduction of greenhouse gas, GHG, emissions sets out a proposed decarbonisation pathway trajectory to achieving our net-zero climate objective for 2050. However, emissions from international aviation and maritime are not currently accounted for within the carbon budget programme and the sectoral emissions ceilings that were agreed by the Government last July. Emissions from domestic aviation and shipping accounted for only 2.3% of our 2018 transport baseline, and the focus of our national climate action plan is therefore concentrated on the land transport sector. Nonetheless, as an island nation reliant on our international connectivity, we recognise that decarbonisation of our aviation and maritime sectors is essential.
An efficient and resilient maritime transport sector is fundamental to the successful functioning of the Irish economy: over 90% of Ireland’s international trade in terms of volume is carried by sea. We have witnessed the sector’s remarkable resilience, agility and ability to respond quickly to changes and challenges, such as Covid-19, Brexit and the current Ukrainian conflict. Shipping is the transport mode with by far the lowest climate footprint per tonne transported, but maritime transport still accounts for between 3% and 4% of EU emissions. There is a need to act decisively in order to align the sector with the global temperature goals of the Paris Agreement. Meaningful and ambitious engagement at the International Maritime Organisation and other voluntary initiatives is essential for the greening of shipping. Ireland has maintained a voice of high ambition throughout such negotiations, alongside other high-ambition countries. In 2021, Ireland became cosignatories to the UK’s Clydebank Declaration for green shipping corridors at COP26 in Glasgow, and has also signed the Declaration on Zero Emission Shipping by 2050. These are both high-ambition declarations signalling Ireland’s intention to work multilaterally on solutions in this area.
Last week’s successful revision of the IMO’s greenhouse gas strategy at the Marine Environment Protection Committee 80, MEPC 80, represents a significant major increase in ambition, establishing a goal of net-zero GHG emissions from ships by or around 2050 relative to the previous 50% target reduction of the 2018 strategy.
The revised strategy also introduced important checkpoints and timelines for the adoption and entry into force of longer-term candidate measures, placing the sector on a pathway to achieving net zero.
At European level, the EU’s Fit for 55 legislative package also includes several proposals, including the ReFuelEU maritime regulation and the alternative fuels infrastructure regulation, both of which the European Parliament voted to adopt yesterday, 11 July, the revised monitoring, reporting, and verification, MRV, regulation and the EU emissions trading system, ETS, directive. Each of these provide regulatory certainty for the shipping industry. While the combination of these files will place additional obligations on the maritime sector, I am confident that the sector can and will apply the same resilience and capabilities, as shown in addressing recent shocks, to addressing our climate challenges.
On alternative fuels supply, the role of our domestic maritime sector will be critical in facilitating the development of offshore renewable energy infrastructure and integral to achieving our wider national targets. This includes delivery of 5 GW of grid-connected offshore wind and developing an additional 2 GW of floating offshore wind to support the production of green hydrogen. Realising these targets for 2030 will help us to electrify and reduce our emissions in the transport sector. It will also allow our ports to play an important role as green energy hubs for future fuels, such as green hydrogen, e-methanol and ammonia.
I will turn to the aviation sector. This sector has a crucial role in maintaining Ireland’s economy, for tourism, for trade, for foreign direct investment and, given our geography, for connectivity with the rest of the world. Ireland, through the programme for Government, is committed to supporting EU and international action to reduce emissions in the sector. This presents a particular challenge as the sector continues to grow in Ireland and internationally. The International Civil Aviation Organization estimates annual growth in European aviation of more than 3% per annum to 2050 for passenger traffic and up to 2.4% for freight traffic. Industry and governments must act decisively and collectively if we are to meet our climate goals. This is recognised in the industry’s shared goal of net-zero carbon emissions by 2050. It is reflected in the adoption at global level of the long-term aspirational goal for aviation emissions reduction.
At European level, measures within the Fit for 55 package, including the ReFuelEU aviation regulation and the strengthened EU’s ETS legislation, will make a significant contribution to decarbonising aviation. This will be done by drawing on the internationally recognised basket of measures, with emphasis on four key pillars. The first is technological advances in aircraft design, which will lead to reduced emissions through more fuel-efficient aircraft, and aircraft powered by alternative energy sources such as hydrogen and electricity, which are currently under development. The second pillar is market-based measures such as the EU’s ETS and the carbon offsetting and reduction scheme in international aviation, CORSIA, which will incentivise airlines to reduce their emissions. The third pillar is improved operational measures such as air traffic management to help reduce fuel burn and time spent in the air. The fourth pillar is the development and deployment of sustainable aviation fuel, commonly known as SAF. Here, the use of SAF is considered to provide the greatest level of emissions abatement. It is estimated that the use of SAF will account for up to 65% of the mitigation needed to achieve the goal of net zero by 2050. A key factor is that SAF, as a drop-in fuel blended with jet kerosene, can be used in current aircraft and existing fuelling infrastructure.
In particular, the ReFuelEU aviation regulation will mandate minimum levels of SAF to be supplied at 2% from 2025 and increase to 70% by 2050, while the granting of free allowances within the EU ETS will further incentivise the uptake of SAF. We will, however, require significant increases in production capacity to meet the ReFuelEU mandate levels. The preparatory ReFuelEU aviation study estimated that more than 100 additional SAF producing plants would be needed in the EU by 2050. In this context, the potential for SAF production in Ireland needs to be properly explored. To support this work, I have asked officials in my Department to establish a cross-departmental working group. This will involve industry experts to inform and guide our future work in this area and it will include an assessment of the potential for local production of SAF in the State, and what barriers may exist currently for producers. This much-needed ramp up of production of SAF reflects the step change needed to meet the demands of the aviation industry. Alongside the complexity of production, lies the additional challenge of ensuring that SAF can be made available at a competitive price. Currently, we expect that the gradual introduction of SAF will result in additional fuel costs for airlines, until production capacity and economies of scale are achieved.
All that being said, there remains an urgent imperative to halt further unsustainable growth in our fossil-fuel usage in all transport sectors, and to decouple our transport systems from a reliance on fossil fuels. Our challenge will be how we meet our climate commitments while maintaining affordability and competitiveness. I trust that this has outlined the huge amount of activity under way and I look forward to the committee’s support as we seek to accelerate and progress the implementation of such measures.
