New Zealand’s coastal shipping industry should be exempt from the Government’s Emissions Trading Scheme (ETS) in order to remove a “substantial burden” on a sector “that is well understood to be environmentally efficient”.

Such is the tenor of a submission to the New Zealand ETS Review made by New Zealand Shipping Federation executive director Annabel Young.

Ms Young says the recent increase in the ETS charge to 1.42 cents per litre will add a substantial operational cost on her members, which international vessels bunkering in New Zealand are exempt from.

“This gives those ships a legislated advantage over New Zealand-based ships,” states Ms Young.

“This is significant as the international and New Zealand-based ships compete directly for local cargo, that is, between New Zealand ports.

“The Federation believes that the same rules should apply to all operators in New Zealand waters.”

Ms Young says it is her members’ understanding that the international norm is for bunker fuel to be considered outside various carbon disincentive schemes that are in place around the world.

“We believe that this reflects the wide acceptance of the relative efficiency, especially carbon efficiency, of ship operations.

“Therefore, the Government policy objectives can be best met by ensuring that transport by sea is not penalised by the operation of the ETS.”