The world’s largest carbon market is set for a historic revamp. Europe’s shipowners are concerned

Published

4 years ago

July 12, 2021

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The container ship Maersk Murcia sits moored to a terminal in the port of Gothenburg, a busy shipping centre on the west coast of Sweden, as cargo is loaded onto it by crane before it sets sail on August 24, 2020.

JONATHAN NACKSTRAND | AFP | Getty Images

LONDON — The European Union is due to propose an unprecedented overhaul to its carbon market this week, seeking to put a price on shipping emissions for the first time.

And the region’s shipowners are deeply concerned.

The European Commission, the EU’s executive arm, is set to present its green fuel law for EU shipping on Wednesday. It is part of a broader package of reforms designed to meet the bloc’s updated climate targets.

To be sure, the EU has committed to reducing net carbon emissions by 55% (when compared to 1990 levels) through to 2030, becoming climate neutral by 2050. The EU says this will require a 90% reduction in transport emissions over the next three decades.

To meet these targets, the EU plans to undergo the biggest revamp of its Emissions Trading System since the policy launched in 2005. Already the world’s largest carbon trading program, the ETS is now widely expected to expand to include shipping for the first time.

Lars Robert Pedersen, deputy secretary general of BIMCO, the world’s largest international shipping association, says it is no secret the industry has concerns about the EU’s plans.

You’re not going to change the fleet on a dime. In the near to medium term any imposition of a carbon price would essentially be a tax.

Roman Kramarchuk

Head of future energy analytics at S&P Global Platts

“There is a strange misbelief in Europe that these kinds of actions put pressure” on other regions to do the same, Pedersen told CNBC via telephone. “I think, frankly, it has the opposite effect.”

He argued the proposal was “not conducive” to international policy, would fail to reduce regional carbon emissions and ultimately take money out of the shipping industry when it could otherwise be spent on reducing emissions in the fleet.

“It is taxation. Does that help anything when it comes to decarbonization? I don’t think so. It looks more like it is an effort to collect money — and so be it,” Pedersen continued. “Europe decides what Europe decides and there’s not so much you can do about that, I guess, other than highlight that it might not be the most appropriate way to reduce emissions.”

His comments come shortly after Transport & Environment, a European non-profit, purportedly obtained a leaked proposal for a draft of the first-ever law requiring ships to progressively pivot to sustainable marine fuels.

A liquid natural gas (LNG) storage silo at the LNG terminal, operated by LNG Croatia LLC, in Krk, Croatia, on Monday, Jan. 25, 2021.

Petar Santini | Bloomberg | Getty Images

A spokesperson for the commission declined to comment on the draft proposal. The EU has said action to address EU international emissions from navigation and aviation is “urgently needed” and initiatives to address these areas will be designed to boost the production and uptake of sustainable aviation and maritime fuels.

Pedersen said it was important not to panic over the leaked draft, noting that it could still be revised in the coming days and there are many more hurdles to overcome before the measures become EU policy.

EU member states and the European Parliament would first need to negotiate the final reforms, a process that analysts estimate could take roughly two years.

“To be frank with you, I haven’t even bothered to read it because I think it is a waste of time at this point. We have a date when the final proposal will be presented, and we will read that very carefully,” Pedersen said.

‘An environmental disaster’

Shipping, which is responsible for around 2.5% of global greenhouse gas emissions, is seen as a relatively difficult industry to decarbonize because low-carbon fuels are not widely available at the required scale.

Soren Toft, chief executive of the Mediterranean Shipping Company, the world’s second-largest container carrier, has also criticized the EU’s proposal. Speaking to The Financial Times last month, Toft warned the proposals would have the opposite effect of their intentions in the absence of readily available low-carbon fuels.

What’s more, it is not just the shipping industry that has voiced opposition to the EU’s plans.

Transport & Environment described the leaked draft of the commission’s proposal as “an environmental disaster,” arguing the policy does not incentivize investment in low-carbon fuels such as renewable hydrogen and ammonia. Instead, it argues the proposal promotes liquefied natural gas and “dubious” biofuels as an alternative to marine fuel oil.

“It’s not too late to save the world’s first green shipping fuel mandate,” said Delphine Gozillon, shipping policy officer at Transport & Environment. “The current draft pits e-fuels against much cheaper polluting fuels, giving them no chance at all to compete on price. The EU should revise the draft to include an e-fuels mandate and make them more cost-attractive through super credits.”

Europe’s ETS is the bloc’s main tool for reducing greenhouse gas emissions that cause climate change. It forces heavy emitting businesses, from aviation to mining, to buy carbon permits in order to create a financial incentive for firms to pollute less.

One issue currently afflicting the scheme, however, is so-called “carbon leakage,” where businesses transfer production (and emissions) elsewhere due to the relative cost of polluting in Europe.

The EU is expected to address this problem, potentially implementing what’s known as the carbon border adjustment mechanism from 2023. The policy is an attempt to level the playing field on carbon emissions by applying domestic carbon pricing to imports.

How will the EU’s proposal impact carbon prices?

“How shipping is brought into a pricing regime is critical,” Roman Kramarchuk, head of future energy analytics at S&P Global Platts, told CNBC via email.

“But the July proposal will be far from a done deal,” he continued. “It’s worth remembering that the EU had to temper its ambitions around aviation previously in response to push-back from trade partners — though the upshot of that was a more globally inclusive approach from the UN through the CORSIA program.”

The Carbon Offsetting and Reduction Scheme for International Aviation initiative refers to a United Nations deal designed to help the aviation industry reach its “aspirational goal” of making all growth in international flights “carbon neutral” from 2020 onwards.

Kramarchuk said it was important to note that the proposed policies were not expected to constitute an outright ban on specific fuels, adding S&P Global Platts sees increasing shares of the shipping fleet being powered by LNG, methanol or ammonia through to 2030.

Electricity pylons are seen in front of the cooling towers of the coal-fired power station of German energy giant RWE in Weisweiler, western Germany, on January 26, 2021.

INA FASSBENDER | AFP | Getty Images

The impact that the EU’s proposal has on carbon prices will also be “crucial,” Kramarchuk said, predicting an end-of-year target for the EU’s benchmark carbon price at 60 euros per metric ton.

The December 2021 carbon contract surpassed 50 euros for the first time ever in May, having stood at around 20 euros before the coronavirus pandemic. It was last seen trading at around 54 euros.

Higher carbon prices would likely raise questions about the competitive decisions shipping firms take around fuel choice and in turn depend on how carbon emissions in fuels are accounted for, Kramarchuk said.

“But you’re not going to change the fleet on a dime. In the near to medium term any imposition of a carbon price would essentially be a tax.”

Environment

China-made panels drive Africa’s 15 GW solar import milestone

Published

11 hours ago

August 25, 2025

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China-made panels drive Africa’s 15 GW solar import milestone

Solar is taking off across Africa in a big way. According to a new analysis of China’s solar panel exports data from energy think tank Ember, solar panel imports into the continent jumped 60% in the 12 months through June 2025, setting a record that could reshape electricity systems in many countries.

In that period, Africa imported 15,032 megawatts (MW) of solar panels, up from 9,379 MW the year before. While South Africa has dominated past surges, this wave is happening across the map: 20 countries set new import records, and 25 countries each brought in at least 100 MW, compared to just 15 a year earlier.

Nigeria overtook Egypt to become the second-largest importer with 1,721 MW, while Algeria surged into third with 1,199 MW. Growth rates in some countries were staggering: Algeria’s imports jumped 33-fold, Zambia’s eightfold, Botswana’s sevenfold, and Sudan’s sixfold. Liberia, the DRC, Benin, Angola, and Ethiopia all more than tripled their imports.

Still, import numbers don’t tell the whole story. It’s unclear how many of these panels have been installed yet. Muhammad Mustafa Amjad of Renewables First, an energy transition think tank in Pakistan, pointed out that countries risk losing valuable time and opportunities without proper tracking. “Africa’s transition will happen regardless,” he said, “but with timely data it can be more equitable, planned, and inclusive.”

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If these panels do get installed, the impact could be massive. In Sierra Leone, the past year’s imports alone could cover 61% of the country’s 2023 electricity generation. For Chad, it’s 49%. Liberia, Somalia, Eritrea, Togo, and Benin could all boost generation by more than 10% compared to 2023, and 16 countries could see increases of over 5%.

The economic case is also strong. In Nigeria, solar savings from replacing diesel could repay panel costs in just six months, or even less in other countries. In fact, in nine of Africa’s top 10 solar panel importers, the value of imported refined petroleum outweighed solar imports by factors of between 30 to 107.

Ember’s chief analyst, Dave Jones, called the surge “a pivotal moment,” urging more research and reporting to keep pace with the rapid rise to “ensure the world’s cheapest electricity source fulfills its vast potential to transform the African continent.”

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Environment

Hyundai and Kia are growing fast in the US, and EVs are leading the way

Published

13 hours ago

August 25, 2025

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Hyundai and Kia are growing fast in the US, and EVs are leading the way

Hyundai and Kia vehicles are popping up on US roads more than ever, and a lot of it has to do with EVs. The South Korean auto giants just hit another milestone as they gear up to introduce several new models.

Hyundai and Kia bet on EVs, hybrids for growth in the US

After launching their first hybrid vehicles in the US in 2011, the Sonata and K5, Hyundai and Kia have come a long way.

Today, two out of ten Hyundai or Kia models sold in the US are considered “eco-friendly,” including electric (EV), hybrid, plug-in hybrid (PHEV), and fuel cell electric (FCEV) vehicles.

After 14 years, Hyundai and Kia announced on Monday that combined, they have now sold over 1.5 million eco-friendly cars in the US. In a statement, the company said it continues seeing strong demand for several models, including the Tucson Hybrid, IONIQ 5, and Niro Hybrid.

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Although 14 years is a relatively long time, in the first few years, they only offered a few models. It took 11 years to reach the 500,000 mark in 2022, and in just three years, they’ve since tripled it.

Since reaching 100,000 in annual sales in 2021, brand sales of eco-friendly cars have grown rapidly. Hyundai and Kia sold 182,627 units in 2022, 278,122 units in 2023, and 364,441 units in 2024. This year, they sold over 221,500 in the first six months, up 20% from the same period in 2024.

Hybrids accounted for over 1.1 million, followed by electric vehicles with nearly 375,000, and FCEVs at just over 1,850 units sold.

The Hyundai Tucson Hybrid and Kia Niro Hybrid are the brand’s top-selling eco-friendly cars in the US. Hyundai’s Sonata Hybrid and IONIQ 5 ranked second and fourth. Meanwhile, the Kia Sportage Hybrid and Sorento Hybrid placed third and fifth.

Hyundai and Kia offer 19 eco-friendly vehicles in the US, including eight hybrid and PHEVs, 10 EVs, and just one FCEV.

Both brands sold more vehicles in the US in the first half of the year than ever. With Hyundai now building vehicles at its new EV plant in Georgia, including the 2025 IONIQ 5 and 2026 IONIQ 9, the automaker expects the growth to continue. Kia assembles the EV6 and EV9 at a separate plant in Georgia, and will introduce the EV4, its first electric sedan, in early 2026.

Based on the advanced E-GMP platform, Hyundai and Kia’s electric vehicles offer some of the longest driving ranges, fastest charging speeds, and remain surprisingly affordable.

With leases starting as low as $159 per month, the 2025 Hyundai IONIQ 5 is one of the most affordable EV lease deals in the US. Even the three-row IONIQ 9 is listed with monthly leases as low as $299. That’s pretty cheap for a nearly $60,000 three-row electric SUV.

Hyundai will continue to offer hybrids in response to the changing policies under the Trump Administration. It also plans to add hybrid production in Georgia, starting next year.

Looking to check one out for yourself? We can help you find vehicles in your area. You can use our links below to view Hyundai and Kia models near you.

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Environment

Save big on heat pumps and solar before Washington pulls the plug

Published

15 hours ago

August 25, 2025

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Save big on heat pumps and solar before Washington pulls the plug

Three years after the Inflation Reduction Act (IRA) became law, Rewiring America is rolling out a new effort to make sure homeowners don’t miss out on major savings.

The Save on Better Appliances campaign is designed to help families take advantage of federal energy tax credits before they expire at the end of 2025, while also showing how modern electric appliances can cut long-term energy costs.

With utility bills climbing, the group is highlighting the benefits of heat pumps, heat pump water heaters, rooftop solar, and other upgrades that can keep homes comfortable while protecting against future price spikes. For many households, energy-efficient appliances are one of the few ways to bring bills under control – and that value remains even after federal incentives are gone.

Right now, homeowners can still access the federal Energy Efficient Home Improvement Credit (25C) and Residential Clean Energy Credit (25D). On top of that, thousands of state, local, and utility-level incentives are available to help offset upfront costs.

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Ari Matusiak, CEO of Rewiring America, pointed out that the IRA incentives were never meant to last forever:

Congress’s decision to repeal them prematurely means households should act fast. But the savings, comfort, and long-term value of these upgrades remain. For homeowners ready to act, we have the tools to help. And for those who need more time, we’re working to expand your options and ensure that these upgrades make financial sense whenever the moment is right.

What the campaign offers

The Save on Better Appliances campaign runs through October and includes:

A central hub where homeowners can learn about the expiring credits, check out state, local, and utility incentives, and connect with vetted contractors.
Weekly Zoom drop-in sessions with Certified Electric Coaches, starting September 3, to answer questions about home upgrades.
Contractor tools, including Rewiring America’s Contractor Finder, soon to be integrated with the BetterHVAC directory for more trusted installer options.
A new Single-Project Personal Electrification Planner to help homeowners map out common projects like heat pumps, energy audits, and electrical upgrades.

“I’ve been doing HVAC installations for the past 40 years, and I can tell you that I’ve seen firsthand how the 25C tax credit has made heat pumps, the most efficient HVAC technology, more affordable and accessible for homeowners,” said Scotty Libby, owner of Maine-based Royal River Heat Pumps. “Homeowners should talk to their local contractors now if they want to upgrade their HVAC, take advantage of the tax credit, and lock in the potential long-term energy savings a heat pump would provide.”

Beyond tax credits

Rewiring America is also working with manufacturers, contractors, and lenders to make upgrades more affordable, even without federal help. In Rhode Island and Colorado, families can already access specially priced heat pump packages, with more states on the way. These deals will expand in 2026 and beyond, lowering upfront costs no matter what happens in Washington.

Across the country, state agencies, utilities, and local nonprofits are already leading creative programs to help families save money, find trusted contractors, and begin electrifying their homes. Rewiring America says this campaign is about amplifying that work and making it easier for households to take the first step.

“Tax credits may expire, but the benefits of better HVAC – lower bills, healthier homes, and lasting comfort – are here to stay. That’s why we’re supporting Rewiring America’s campaign,” said Bill Spohn, Sr., president of the Better HVAC Alliance.

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