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Some 47 governments and industry groups are lobbying the International Maritime Organization (IMO) to implement an emissions pricing mechanism for greenhouse gases (GHG) to raise a fund to decarbonise shipping.
The proposal is just one of many to be mulled by the IMO at the February meeting of its GHGs working group (ISWG-GHG).
The market-based measure would aim to reduce the price gap between fossil and zero-emission fuels in a way that is not necessarily supported by the EU’s emissions trading system (ETS) or FuelEU Maritime.
Critics of the European systems say that, while they are perfectly capable of punishing shipowners for non-compliance, they do little to incentivise action by fuel refiners to make such low- and zero-emission fuels available to shipping.
Unsurprisingly, FuelEU Maritime has drawn ire from shipowners, typified by remarks by the German Shipowners’ Association (VDR) which called it “a patchwork of rules” that “distort international competition and are ineffective in the fight against climate change”.
The International Chamber of Shipping (ICS) has been pushing for such a measure from the IMO for some years. The current iteration is the latest of many submitted by the ICS with industry support “for the past 10 years” said ICS secretary general Guy Platten this week.
Previous ideas have been for a research and development fund, while others such as this have explicitly targeted the production of zero- or low-carbon fuels.
“While a large number of governments now support a universal flat rate GHG contribution by ships – or something similar – a minority of governments continue to have concerns,” acknowledged Mr Platten. “Working in co-operation with all IMO member states, we will do our best to allay such concerns during the final stages of these critical negotiations about regulatory text.
“The joint text put forward by this broad coalition is a pragmatic solution and the most effective way to incentivise a rapid energy transition in shipping to achieve the agreed IMO goal of net-zero emissions by, or close to, 2050. We are very pleased that such a large and diverse group of nations now firmly supports a common approach to maritime carbon charging. This proposed joint text has been hard fought and is broadly based on ideas ICS has been advocating for the past 10 years.”
The measure’s detractors question where such a fund would be administered, and which companies would be rewarded, arguing that it is a case of ‘shipping marking its own homework’. Concerns include that the measure contradicts the ‘polluter pays’ principle; instead of appearing to target shipping’s financial beneficiaries, the measure would levy high costs on hard-to-decarbonise developing and island nations that are disproportionately affected by climate change and disproportionately reliant, economically, on polluting shipping.
In a highly publicised move in 2022, representatives of Maersk stepped down from the board of the ICS and switched to another industry association, the World Shipping Council (WSC), citing the latter’s pursuit of more aggressive decarbonisation goals.
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