Merchant Shipping (Prevention of Air Pollution from Ships) (Amendment) Regulations 2021

Tuesday 14th September 2021 Grand Committee

Considered in Grand Committee

17:29

Moved by

[Baroness Vere of Norbiton]

That the Grand Committee do consider the Merchant Shipping (Prevention of Air Pollution from Ships) (Amendment) Regulations 2021

Relevant document: Instrument not yet reported by the Joint Committee on Statutory Instruments

[The Parliamentary Under-Secretary of State, Department for Transport (Baroness Vere of Norbiton) (Con)]

My Lords, these draft regulations are necessary because of the ongoing need to reduce pollutant emissions from the maritime sector, to protect public health and the environment. The regulations do this by amending regulations in the Merchant Shipping (Prevention of Air Pollution from Ships) Regulations 2008, which I will refer to as the 2008 regulation, in order that our domestic legislation is aligned with the latest international limits and standards for sulphur and nitrogen dioxide emissions.

The international requirements are set out in annexe VI of the International Convention for the Prevention of Pollution from Ships 1973, also known as the MARPOL Convention. These changes limit the amount of sulphur in marine fuels that are used or intended for use by ships to 0.5% by mass or less. They also require that new ships and new engines be certified to meet the latest NOx emission standards, both globally and when ships operate inside waters which have been designated as an emission control area by the International Maritime Organization.

At this stage, the MARPOL Convention refers to four regions which have enhanced ECA protection status: the North Sea, including the English Channel; the Baltic Sea; North America, which includes both the east and west coasts of the United States and Canada; and the US Caribbean. Ships operating in an ECA must not use fuel which exceeds 0.1% sulphur unless they are using an abatement technology. New ships must also comply with a stricter NOx tier 3 standard. New ECAs could be introduced in future. The Mediterranean is being considered for one and the Government have agreed to consult on a possible ECA for the Irish Sea.

The regulations also enable UK ship inspectors to enforce these new limits more effectively on foreign-flagged vessels calling at UK ports. Currently, under port state control regulations, ship inspectors from the Maritime and Coastguard Agency can apply limited sanctions on ships calling at UK ports for an offence. These include recording a deficiency against the ship, temporarily detaining the vessel or ordering the ship to debunker—empty its fuel tanks—if the ship is using non-compliant fuel, after which access to UK ports and anchorages may be denied if there is evidence of significant non-compliance. These sanctions can be applied to ships only when in port or at anchor.

The new instrument will allow ship inspectors to use the criminal justice system to impose fines on offenders. This is in line with our current approach to other marine pollution offences. The ability to impose fines would be an important deterrent for all foreign-registered vessels within UK waters, whether in transit, in port or at anchor, particularly those that would consider risking non-compliance to reduce costs without the threat of financial penalties. However, I stress that compliance with maritime environmental rules is the norm. Enforcement action by the MCA through the courts is extremely rare and would be funded through existing resources if it were to occur.

The regulations also include an ambulatory reference provision, which will automatically update references in the 2008 regulations to provisions of the convention and its annexes. This implements a key industry request from the Red Tape Challenge, which enables some amendments to international requirements to be transposed into domestic law more rapidly and efficiently than was possible previously. An amendment that is accepted will be publicised in advance of its coming-into-force date by means of a Statement to both Houses of Parliament. However, the ambulatory reference provision is limited. Substantial changes, such as implementing a new chapter into MARPOL annexe VI, would still need to be implemented by statutory instrument.

The regulations also amend obsolete sulphur limits for marine fuels used by ships, which were made under Section 2(2) of the European Communities Act 1972. Specifically, the new regulations remove references to the 1% sulphur limit for ships operating inside an ECA and the 3.5% sulphur limit for ships operating outside an ECA. Of course, these have been superseded by the stricter 0.1% and 0.5% sulphur limits respectively. The new regulations also remove references in the 2008 regulations to a 1.5% sulphur limit which applied to passenger ships operating outside an ECA. Again, this has been superseded because, like all vessels, passenger ships outside an ECA are now subject to the stricter 0.5% sulphur limit.

While it is important to remove obsolete requirements from our domestic legislation that were introduced under Section 2(2) of the European Communities Act, the draft regulations retain others which are still pertinent. For example, they do not amend the requirement for ships to use 0.1% sulphur fuel when at berth in a UK port, which was introduced using Section 2(2) powers in the European Communities Act.

I am sure noble Lords would agree that maintaining the highest standards of environmental protection is vital for public health. It is therefore important that we continue to implement the latest international standards to control ship emissions and have an effective enforcement regime in place. The Government have made it clear that air quality is one of our top priorities. These regulations help deliver on the commitments made in Maritime 2050, published in 2019, and our route map for sustainable maritime transport, the clean maritime plan. It is important for the health of our coastal communities and port cities that we reduce emissions from the shipping industry, and that we ensure we can strongly and visibly enforce the standards we agree at the International Maritime Organization. I commend these regulations to the Committee.

[Baroness Randerson (LD)]

My Lords, I thank the Minister for her very clear introduction. I have no criticism of the regulations themselves, but I want to concentrate on the backlog of maritime legislation within the department and its impact on the sector. I am very grateful to the Secondary Legislation Scrutiny Committee. It has repeatedly drawn attention to this problem, which has existed since 2016. Since then there have been five separate updates to MARPOL, to which the Minister referred. I believe the department still needs to implement over 40 changes to maritime legislation. These regulations, although very welcome, are very late as well.

The Department for Transport says that it has not prioritised this raft of legislation because operators tend to comply with IMO regulatory requirements as ships cross international boundaries all the time. That statement is contradicted by the Government’s own Explanatory Memorandum, which states that the ability of inspectors to sanction non-compliant ships will be very limited until these regulations come into force.

My real concern is the vagueness of all this, so can the Minister provide us with a lot more detail? First, on the simple numbers, the SLSC was told that, of the 40-plus backlog, 10 have now been made, 10—including this one—are in the final stages, and another eight are in the very final stages of preparation and anticipated to be introduced in the 2022-23 Session. The remainder are at an earlier stage of development and are anticipated to be complete by the end of 2023. This is far too slow and could mean that some legislation has been delayed for seven years.

Can the Minister explain exactly how many pieces of legislation are in that final slow lane and why they have been placed there? I realise it is far too much to ask for this to be done here, but could she write to us with a list of all the pieces of legislation in this backlog and say which pieces are in which category? The original DfT target to deal with this backlog was 2020, so why has it lapsed so badly?

I realise that the pandemic has affected everything, but in itself that is not a sufficient excuse, because the pandemic goes back only some 18 months and this backlog goes back to 2016. It must be seen in the context of other delays in DfT legislation. We are in a position where we need more legislation on EVs, driverless cars and other key areas of transport development. A major question must be why the department does not devote more resource to keeping up with modern transport developments. I agree with the committee, which labels the number of delayed pieces of legislation “highly disturbing”.

This is not just a numbers game. Let us look at the implication of these pieces of legislation. Many of them, like this one, have environmental implications. This one concerns sulphur oxide and nitrogen oxide and is about reducing air pollution; it is another example of a Government who talk tough on pollution but fail to deliver on the crucial detail. We must remember that this is about the health and working conditions of sailors as well as the overall state of our planet. Working conditions for many in the maritime sector are often very poor. Many are subject to exploitation and they are certainly often overlooked. We owe it to them to ensure that the UK upholds the highest standards.

This is London International Shipping Week, and I note that the industry has committed itself this week to zero carbon by 2050. It certainly needs the Government to do a great deal more to support it in achieving that. So although these regulations are welcome as far as they go, I would like to see much more from the Government to demonstrate that they are serious about tackling emissions from ships because of the impact on ships’ crews, cruise passengers and dockyard workers, as well as on our planet.

[Lord Greenway (CB)]

My Lords, I agree very much with what the noble Baroness, Lady Randerson, just said about these regulations. I have no problem with them, as she has already said, but I regret very much the considerable delay that has occurred in bringing them forward, and I hope that we will hear some sort of explanation from the Minister when she comes to sum up.

These regulations are not a great surprise. Our shipping industry has been well aware of what is going on for quite some time now, and it has been forced to act by the introduction of these emission control areas, which stole a march on the International Maritime Organization’s regulations by bringing in things that applied not to the whole world but merely to the specific areas that the Minister mentioned. By and large, our own ships have already made the necessary adjustments to be able to operate in these low-sulphur areas.

I have been in this House for 45 years—I am horrified to say it—and in that period I have seen our merchant fleet reduced from a fairly large standing in the world to something that is almost pathetic compared with what it was. We are not the force in international shipping that we were and that is a huge regret, but this country still has great expertise in the maritime field. The Government have set up a new committee to look into things such as finding a new means of propulsion, in effect to try to replace the internal combustion engine. I do not know how that is going, and the Minister probably cannot help me on that, but we still have a part to play in international shipping.

17:45

I am afraid we are no longer involved in the mainstream container business, where P&O was the last company with a large part in that industry. That moved over to Holland, to the Dutch company Nedlloyd, and is now part of the giant Maersk corporation, the Danish giant. There is a company that is entirely committed to reducing marine pollution. The noble Baroness mentioned that at London International Shipping Week, the aim is to have a carbon-neutral industry by 2050. Maersk is very much committed to that and has the first sizeable ship that will use carbon-neutral fuel coming into service in 2023. That will be, by container standards, a fairly small ship—2,000 20-foot equivalent units—but it will be powered by e-methanol, or green methanol, and also able to use standard low-sulphur oil. In a way, the company is hedging its bets, because nobody yet knows how much of the new fuel can be produced, so it must have an alternative. I understand that it aims to produce that e-methanol by using wind power.

On top of that new ship coming on stream, the company has also ordered eight much larger ships—16,000 containers—which will all be in service by 2024. Those ships are quite a bit more expensive than normal ships —10% to 15% more expensive—and cost $175 million. The eight ships are costing $1.4 billion. That has been the problem for the shipping industry: there have been few alternatives to using normal fuel and it has been expensive to make any changes.

What Maersk is aiming to do is a great step forward. It is the bigger ships that cause the problem. I have seen it mentioned that one large container ship with a 100,000 horsepower engine produces more rubbish out of its exhaust than millions of cars. That is probably true, but we must remember that ships provide more than 80% of the world’s trade and, if we are to find any means of solving this problem, it must be one that works well.

There is hope for the future, certainly in terms of smaller ships. There are fuels such as liquified natural gas, biofuels, green hydrogen—even electricity, because one company that operates on the Dover Strait has been looking at the possibility of an electric ferry running between Dover and Calais. All sorts of encouraging work is going on. As I said, the shipping industry has been fairly slow to react, but it is very much getting its act together now, and I hope we will see enormous improvements in future. In the meantime, I support the regulations.

[Lord Tunnicliffe (Lab)]

My Lords, I welcome the introduction of these regulations to implement the standards of the International Maritime Organization to limit air pollution emissions from ships. The specific provisions relating to sulphur and nitrogen oxide have been in place globally for some time, and the decision to transfer them to domestic statute should benefit our natural environment and health. With that said, these regulations must be paired with an overarching approach to air pollution that recognises the value of making maritime cleaner but also includes steps to limit emissions from other modes of transport.

I turn to the specific regulations, which relate to an international agreement from 2008. Why has it taken 13 years for that agreement to be implemented? Given that the Explanatory Memorandum suggests that consultation took place only during the drafting of the international agreement, can the Minister explain what steps the Government have taken to ensure that the maritime industry is aware of these regulations now being implemented? On a related note, can the Minister confirm whether the Government have made an estimate of how many ships in UK waters do not currently meet the provisions of this legislation?

Regarding the Government’s broader approach to maritime pollution, and given that it is now more than two years since the Government’s clean maritime plan, can the Minister confirm whether the UK is on track to zero-emissions shipping by 2050? What steps are the Government taking to meet the ambition for all new vessels to have zero-emissions capabilities by 2025?

Finally, on the wider question of air quality, the Government’s transport decarbonisation plan published in July showed that they are still stalling when it comes to the tough decisions on transport emissions. There have been no sectoral deals with conditions on climate action. There have been deep cuts to electric vehicle grants. No serious steps have been taken to encourage people on to rail through cheaper fares. I welcome the legislation and any other steps that would improve air quality, but if the Government are committed to this principle they need to do much more to support cleaner transport.

[Baroness Vere of Norbiton (Con)]

I thank all noble Lords for their contributions to this short debate. I appreciate their support—if occasional qualification thereof—for these regulations. The problems really lie in matters beyond these regulations, which I think make sense to the Committee. I shall cover a few things that were mentioned, and I shall start off by outlining a bit more of the context. Air quality is one of our top priorities. That is what these draft regulations do, although to a certain extent they are belt and braces; they fill in some of the gaps in the regulatory framework and enforcement regime that exist in a more global fashion for the shipping industry as a whole.

Maritime pollution emissions are very important. As noted by the noble Lord, Lord Greenway, in 2016 domestic shipping—shipping specifically within the UK—accounted for 11% of the UK’s domestic NOx emissions, 2% of PM2.5 and 7% of sulphur dioxide. That is quite a significant proportion for an industry that is fairly small—but, as the noble Lord, Lord Greenway, pointed out, incredibly important. The department is working closely with Defra to develop more detailed information on emissions from shipping in order to assess the impact of air pollution prevention measures implemented since the comprehensive study carried out in 2016. In addition, international shipping emissions are significantly greater and have a significant impact on air quality in the UK, from ships both in shipping lanes and while they are at UK ports.

The Government recognise that pollutant emissions from international shipping have an impact on public health and the local environment. Our national targets for air quality include this impact. We work incredibly closely with the International Maritime Organization to address pollutant emissions by UK-flagged vessels and those within UK waters, as well as globally.

Reductions in air pollutant levels are closely linked to reductions in levels of greenhouse gases, as noted by the noble Lord, Lord Tunnicliffe, and the noble Baroness, Lady Randerson. As they will both know, the Government remain fully committed to our 2050 net-zero target for domestic shipping. This is designed to address both greenhouse gases and pollutant emissions from shipping. Just earlier this week, we announced that we will push for zero-emissions targets for international shipping, to challenge the international community collectively to deliver a Paris-compliant outcome when the IMO renegotiates its strategy for climate change in 2023.

Furthermore, we have continued to make good progress on the commitments we set out in the clean maritime plan, which was published in 2019, that by 2025 all new vessels for use in UK waters are going to be designed with zero-emissions capabilities and that by 2035 zero-emission maritime fuel infrastructure, known as bunkering, is widely available across the UK. We are doing this by providing £1.4 million-worth of funding for a competition for innovation in clean maritime. We have established the marine emissions reduction advisory service as a function of the MCA’s future technologies team, undertaking research, considering the role of maritime clusters in delivering clean innovation and growth and exploring the inclusion of the maritime elements in the renewable transport fuel obligation as part of a public consultation.

Building on the clean maritime plan, the Prime Minister’s 10-point plan in November 2020 announced up to £20 million for a clean maritime demonstration competition to develop clean maritime technologies. If we know one thing from the excellent speech from the noble Lord, Lord Greenway, it is that at the moment we are not quite sure what technology will win out in shipping. It is one of those areas that would be harder to reach by battery electric and therefore we need to look at other alternatives, whether that be low-carbon fuels or hydrogen combustion engines. It could be all sorts of different things, and that is why the Government are very much focused on what we can do to support the market to develop the solutions and then be able to support those which are most appropriate for commercialisation.

Turning to some of the issues in the regulations themselves, I think it was the noble Lord, Lord Tunnicliffe, who asked how many ships this would cover in the UK—the UK-owned ships. I do not have that information, but I can say that the additional cost to UK-owned ships that operate only domestically is estimated to be around £2 million a year following the introduction of these regulations. I will see if I can find out more information as to what that would mean per vessel.

In terms of engagement with the industry, the department discussed the draft regulations with the UK Chamber of Shipping and fuel suppliers to consider the impact. We did not carry out a formal consultation on the draft regulations. As the noble Lord, Lord Greenway, pointed out, the measures were well-known within the maritime and fuel supply sectors so there is nothing novel about the implementation of international requirements. It should also be noted, of course, that these regulations were published in draft back at the end of May because they are part of the enhanced security arrangements relating to amendments made to legislation under Section 22 of the European Communities Act. We had no feedback at all from industry stakeholders on the documents following publication, therefore we were reassured that industry fully understood what was coming down the track.

Turning to the point raised by the noble Baroness, Lady Randerson, we will take this on the chin. We recognise that there is an issue here and we will work very closely with the Secondary Legislation Scrutiny Committee to keep it updated with our backlog of legislation. We thank it for its work and for working with us on this. Minister Courts, the Maritime Minister, wrote to the committee on 5 July. I am sure the noble Baroness will have seen the letter. I have various lists of Sis, but I do not think it will be helpful if I read them all out. I might try to put it all in a letter afterwards. The latest stats I have are that there are 43 maritime statutory instruments to be delivered. We are prioritising those that are safety critical or that implement the IMO standards. We have done 13 to date. We have another nine for completion between now and early 2022 and then 21 instruments in 2022 and 2023. I think we can probably do better than that. I also happen to know that the SLSC has been back in touch with the DfT—and rightly so—to have yet another conversation with us about our legislative programme. We will, of course, be as open as we can. We are doing our best to prioritise legal resources. I am going to be honest with noble Lords that legal resources are stretched across government at the moment. It is not just a DfT issue, and we obviously have to work within what we have.

I will not say more on enforcement now; I would rather write, because what I have pretty much says what I said in my opening speech, and I am not entirely sure about this. However, I will go back and look at Hansard to see whether we can provide more information about specific things relating to enforcement and the gaps we are filling in.

It has been a pleasure to be back in real life discussing SIs in the Moses Room—I have missed it. It is also apt that we are having this debate during London International Shipping Week. I know that the noble Lord was a bit of a Debbie Downer on the role of the UK in international shipping, but I have to say that London International Shipping Week is an amazing event. We are able to bring together some of the leading people from the sector. I, for one, feel that the last one I was at, two years ago, was a great success, and I am sure that this one will be too. However, back on the regulations for the time being, once again, I commend them to the Committee.

Motion agreed.