Trafigura’s Bach Nielsen urges quick action on global regulatory framework

Rasmus Bach Nielsen, head of fuel decarbonisation at Swiss commodities trading giant Trafigura, has called on regulators to accelerate decision-making, emphasising the need for a shipping carbon levy before it is too late.

Bach Nielsen reflected on speeches by Kitack Lim, secretary-general of the International Maritime Organization (IMO), and Magda Kopczynska, director for waterborne transport at the European Commission, at the Nor-Shipping Ocean Leadership Conference yesterday, highlighting collaboration and carbon pricing, among other things.

“We should not get fooled that collaboration will not solve the problem. The problem is the cost gap of zero-carbon fuel and fossil fuels and IMO has a tremendous task and they are progressing, but if they don’t continue to progress fast enough, we will not be able to decarbonise at the pace that society requires,” Bach Nielsen told the conference, adding that he hopes Lim’s key highlight onwards would be the price on carbon instead of collaboration.

We need a lot more action from the IMO

As for the great support for the global carbon price, Bach Nielsen noted that: “What we hear and what we feel, also through round table events in Brussels, is that the funds which the EU is potentially going to collect from the ETS (Emissions Trading System) will not be directly channeled back into shipping.”

He stressed that the production cost of clean fuels is “not realistic” to bring to the market unless the industry has a global regulatory framework.

“We need a lot more action from the IMO, and if the IMO does not pick up the pace, ultimately they’ll be responsible for holding back shipping decarbonisation,” warned Bach Nielsen.

Magnus Ankarstrand, president of Yara Clean Ammonia, agreed that there is a need for very clear regulation to know what the actual framework will be and that it will be “extremely important to speed up because if not, everybody will wait for everybody.”

“Somebody has to put the whole puzzle together and that needs to be the governments to make sure that regulations are clear and that there is sort of a clear outsight for what we should plan for,” Ankarstrand said.

Synnøve Seglem, Knutsen’s deputy managing director and president of the Norwegian Shipowners’ Association, added that it is important that tax from CO2 goes to funding that will drive more technology and development to meet the new standards. “If not, it will be quite difficult for shipping to decarbonise at the pace that we’ve all been talking about,” she told delegates.

Adis Ajdin

Adis is an experienced news reporter with a background in finance, media and education. He has written across the spectrum of offshore energy and ocean industries for many years and is a member of International Federation of Journalists. Previously he had written for Navingo media group titles including Offshore Energy, Subsea World News and Marine Energy.
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