The head of number-two ocean carrier MSC, Soren Toft, has broken with former boss Soren Skou over the question of a carbon tax for shipping. In a carefully-written statement issued Friday, Toft signaled support for an industry-backed $2 per tonne bunker levy and cast doubt on the effectiveness of a carbon tax until more carbon-neutral fuel solutions are available.
In recent appearances, Maersk CEO Soren Skou has suggested that electrofuels like green methanol and green ammonia provide a known path to zero-carbon shipping. Under his leadership, Maersk has ordered its first methanol-powered vessel, and it will take delivery in 2023.
In order to ensure that costlier green fuels can be competitive, Skou has called for a $450 per tonne bunker tax – less than the $750 per tonne effective tax level recently calculated by Trafigura, but far more than the ICS-backed $2 per tonne R&D levy.
In a statement Friday, Toft suggested that – contrary to Maersk’s experience – “scalable long-term solutions simply do not currently exist for us to deploy on our ships.” Rather, Toft’s MSC believes that supply chain issues and technical questions must be solved before new fuels can be scaled up for the shipping industry. Given this question of availability, he expressed ambivalence about the effectiveness of carbon pricing until after more R&D has been completed and low-carbon solutions exist at scale. As a solution, he reiterated MSC’s support for the ICS-backed $2 per tonne, $5 billion, 10-year-long research levy to investigate carbon-neutral fuels.
Given IMO’s implementation process and the length of the ICS-backed R&D program, its completion could be as far away as the mid-2030s. During the last IMO MEPC meeting in November, the World Shipping Council (WSC) confirmed that the initiative is designed to roll out solutions for industry beginning next decade. By contrast, Skou has called on IMO to support known technologies with a steep carbon tax within the second half of the 2020s.
Toft was once Skou’s second-in-command at Maersk, serving as EVP and COO. He was tipped as Skou’s likely successor, but he departed Maersk suddenly in November 2019 for an undisclosed outside role. After a year’s hiaitus, he reappeared as CEO of MSC in December 2020, and he has led the number-two line on a spree of vessel orders and second-hand acquisitions – putting it on track to exceed Maersk Line on a TEU basis.
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