On the impact of the economic crisis on CO2 emissions from shipping

The Marine Environment Protection Committee of the IMO recently decided to make a new study on GHG emissions from shipping, as “the current estimate does not take account of the economic downturn experienced globally since 2009” (MEPC 64/5/5, Annex, p. 1). This is certainly true, though one wonders if it matters. As will be shown below, global sales of marine bunker surpassed pre-crisis levels already in 2010.

While the financial crisis had little impact on global CO2 emissions, one could envision it being different for the shipping industry. Indeed, trade collapsed in 2009—trade volumes fell 17.5% between September 2008 and January 2009—but it has now recovered to pre-crisis levels. Trade re-growth has been uneven, however: developing countries have exceeded these levels, particularly China and East Asia, though developed countries which saw the greatest drop in trade have still to catch up in terms of trade volume. From the perspective of many investors, ship owners, ship operators and other stakeholders, this is probably much less than expected. A record delivery of new ships in 2010 (ordered in good times, well before the crisis), resulting in a 8.6 percent growth of the world fleet that year, ensured that there is still an overcapacity of ships compared to transport demand.

There have been many assessments of GHG emissions from shipping during the last decade, using different methodologies. Miola (2011) provided an excellent review. The perhaps most simple assessment is based on sales of marine bunker fuels, statistics which have been available through the International Energy Agency (IEA) for many years, and which is based on the reporting of individual countries. This data is believed to under-estimate the total emissions, and is shown together with more reasonable estimates on international shipping emissions in the below figure (Buhaug et al. (2009) is the Second IMO GHG study, with upper and lower bounds as provided in the report (Table 3.3, p. 27) added to the figure).

The economic crisis had a more severe effect on the developed world in terms of bunker sales, but did in total rebound past pre-crisis levels in 2010 (it fell 5% from 2007 to 2009, and then increased 7% from 2009 to 2010). As can also be seen in the figure, sales of bunker have increased constantly in non-Annex I countries since the last decade, and has for years surpassed Annex I countries.

Moreover, the magnitude of the impact should be considered in the context of the uncertainty associated with the method used in the Second GHG study, which produced an estimate with lower and upper bounds of about plus/minus 20% (so, when it is claimed that shipping contributed to 3.3% of global CO2 emissions in 2007, one should rather think “from 2.7% to 3.6%”). This uncertainty is far larger than the impact of the economic crisis as seen in bunker sales statistics.

Thoughts, comments etc. are greatly appreciated.


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