Climate change represents a significant challenge for nations around the globe, and Malta is no exception. As a member of the European Union (EU) and the United Nations Framework Convention on Climate Change (UNFCCC), Malta has committed to reducing greenhouse gas (GHG) emissions across various sectors. The European Emissions Trading System (EU ETS) is a cornerstone of these efforts, targeting specific industries including aviation, maritime transport, and buildings and road transport. This article explores Malta’s approach to mitigating climate change in these three critical areas and the mechanisms involved.
1. Aviation Sector: Navigating Emission Reductions Through the EU ETS
Malta’s aviation sector plays a vital role in the economy, but it also contributes significantly to greenhouse gas emissions. To address this, the EU Emissions Trading System (EU ETS) has established clear protocols for aircraft operators, aiming to balance economic activity with environmental responsibility.
Compliance Requirements for Aircraft Operators
Aircraft operators in Malta and the European Economic Area (EEA)—including EU Member States, Iceland, Liechtenstein, and Norway—must comply with the EU ETS. This regulation also extends to certain operators under the Swiss Emissions Trading System, as per a linkage agreement between the EU and Switzerland. Malta is responsible for administering the EU ETS for aircraft operators with a Maltese license and those attributed to Malta according to EU ETS rules.
Key Compliance Steps:
- Monitoring Emissions: Aircraft operators must develop a comprehensive emissions monitoring plan, approved by the Climate Action Authority. This plan ensures accurate tracking of emissions during flights.
- Annual Reporting: Operators are required to prepare and submit an annual Emissions Report. This report is verified by an independent, accredited verifier, ensuring transparency and accountability.
- Surrendering Allowances: Operators must surrender allowances corresponding to their reported emissions. Free allocation of allowances is available for specific operators. For example, Air Malta PLC is allocated 52,948 allowances in 2024 and 33,595 in 2025. Similarly, Wizz Air Malta Ltd receives 258,156 allowances in 2024 and 163,801 in 2025.
CORSIA: A Global Initiative for International Aviation
Malta is also aligned with the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), an initiative by the International Civil Aviation Organisation (ICAO). CORSIA focuses on reducing emissions from international flights and requires operators to offset their emissions through approved carbon offset programmes. Key compliance steps include monitoring emissions, preparing verified reports, and acquiring and cancelling offsetting units as per annual requirements.
Example: An operator flying from Malta to a non-EU country would need to track and report emissions under CORSIA rules and acquire the necessary offsets to meet compliance.
2. Maritime Sector: Emissions Reduction Through the EU ETS
The maritime sector is critical to Malta’s economy, given its strategic location in the Mediterranean. As part of the EU’s commitment to reducing carbon emissions, the Emissions Trading System has been extended to include maritime transport starting in 2025.
Scope and Requirements of the EU ETS for Shipping
From 2025 onwards, shipping companies will need to surrender allowances corresponding to their carbon dioxide emissions from activities related to maritime transport. Emissions of methane (CH₄) and nitrous oxide (N₂O) will be included starting in 2026. This phased approach ensures a gradual adaptation for shipping companies while maintaining a firm commitment to emission reductions.
Annual Surrender Requirements:
- 2025: Shipping companies must surrender allowances covering 40% of their verified emissions from 2024.
- 2026: 70% of verified emissions from 2025 must be accounted for.
- 2027 Onwards: 100% of verified emissions for each previous year must be surrendered.
Monitoring and Reporting Obligations:
Shipping companies must monitor emissions in compliance with Regulation (EU) 2015/757. This includes tracking carbon dioxide emissions during voyages to and from EU ports and submitting aggregated emissions data annually to the national Competent Authority.
Example: A shipping company registered in Malta that completes voyages within EU waters will be required to track its CO₂ emissions, verify the data, and submit the corresponding report to the Climate Action Authority in Malta. By 2027, this company will need to surrender allowances equal to 100% of its verified emissions from the previous year.
3. Buildings and Road Transport: Transitioning to ETS-2 for Broader Impact
Starting in 2027, the European Union will implement a new Emissions Trading System, ETS-2, specifically targeting emissions from fuel consumption in buildings, road transport, and additional sectors like manufacturing and construction. This is a crucial step towards reducing the carbon footprint in Malta’s everyday life.
Obligations for Regulated Entities
Entities regulated under ETS-2 must obtain a greenhouse gas emissions permit from the Competent Authority by January 1, 2025. These entities are responsible for monitoring and reporting emissions linked to the combustion of fuels in buildings and road transport.
Key Compliance Steps:
- Developing a Monitoring Plan: Each entity must prepare a detailed plan to monitor emissions, which must be submitted to the Competent Authority for approval.
- Annual Emissions Reporting: Regulated entities must submit verified emissions reports annually and surrender the corresponding number of allowances.
- Cost Reporting: Starting in 2028, entities must report the costs associated with allowances that have been passed on to consumers.
Example: A construction company in Malta using fuel for machinery would need to track its emissions, prepare an annual report, and surrender allowances for its carbon output under ETS-2. From 2028, the company will also need to disclose how the costs of these allowances are reflected in consumer pricing.
Malta’s Greenhouse Gas Inventory: Understanding the National Emission Profile
Malta’s strategy for addressing climate change is underpinned by a robust inventory of greenhouse gas emissions. As a party to the UNFCCC, Malta is required to submit an annual inventory of GHG emissions and removals. This inventory is vital for shaping climate policies and targeting emission reductions effectively.
Scope of the Greenhouse Gas Inventory
Malta’s GHG inventory covers seven direct greenhouse gases, including carbon dioxide (CO₂), methane (CH₄), nitrous oxide (N₂O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), sulphur hexafluoride (SF₆), and nitrogen trifluoride (NF₃). The inventory also includes indirect greenhouse gases like carbon monoxide and nitrogen oxides, although these are reported separately.
Sectoral Contributions to Emissions:
Malta’s GHG inventory categorises emissions into five main sectors:
- Energy: Emissions from fossil fuel use in electricity generation, industry, transport, and buildings.
- Industrial Processes and Product Use (IPPU): Emissions from non-combustion industrial processes, including refrigeration and air-conditioning systems.
- Agriculture: Emissions from livestock and crop cultivation.
- Land Use, Land-use Changes, and Forestry (LULUCF): Emissions and removals from land use changes and forestry activities.
- Waste Management: Emissions from landfills, incineration, composting, and sewage treatment.
Example: In the 2024 submission, Malta reported its emissions profile from 1990 to 2022, highlighting trends in the energy and waste management sectors as primary sources of GHG emissions.
Global Warming Potential (GWP) of Greenhouse Gases
The Global Warming Potential (GWP) measures the impact of various greenhouse gases relative to CO₂ over a 100-year time horizon. This metric is critical for calculating the overall climate impact of different emissions and informing mitigation strategies.
Example: Methane (CH₄) has a GWP of 25, meaning it is 25 times more effective at trapping heat in the atmosphere compared to CO₂ over a century. This makes reducing methane emissions a priority in sectors like agriculture and waste management.
Conclusion: A Unified Approach to Mitigating Climate Change in Malta
Malta’s commitment to reducing its carbon footprint across aviation, maritime, and buildings and road transport sectors demonstrates a holistic approach to combating climate change. Through the EU ETS and CORSIA, Malta is aligning with international efforts to cap and reduce emissions, while the upcoming ETS-2 aims to broaden the scope of emission reductions. The detailed greenhouse gas inventory process enables precise targeting of emission sources, ensuring that Malta’s climate policies are data-driven and effective.
By combining regulatory frameworks, technological innovation, and international cooperation, Malta is working towards a more sustainable future. The comprehensive approach outlined above provides a pathway for balancing economic development with environmental responsibility, ultimately contributing to global efforts against climate change.
