The International Maritime Organization (IMO), the United Nations agency with 176 member states tasked with setting global shipping standards, has announced a delay in adopting the “IMO Net-Zero Framework.” This global agreement is intended to implement measures to mitigate the climate impact of ocean shipping.
Despite initial support in April for the draft framework, it faced significant opposition from the United States under the Trump administration, which threatened retaliatory actions against countries endorsing the agreement. Maritime shipping contributes approximately 3% of global greenhouse gas emissions, with projections indicating potential doubling by 2050 if current trends persist. Addressing shipping emissions is challenging, necessitating the development and implementation of low-emission fuels, infrastructure, and technologies.
The draft framework proposed international regulations to reduce greenhouse gas emissions from ships, including a global fuel standard and a carbon pricing mechanism. Ships would be required to meet a new global fuel standard to decrease their annual greenhouse gas fuel intensity (GFI) over time. Ships exceeding GFI thresholds would need to offset their emissions by transferring surplus units from other ships, using banked surplus units, or purchasing remedial units.
Proceeds from remedial unit sales would fund the IMO Net-Zero Fund, which aims to incentivise low-emission ships, support innovation and research, and facilitate infrastructure and technology transfer, particularly to developing countries. This initiative would also aid in mitigating impacts on vulnerable states.
In April, the framework received approval from 63 nations. However, the U.S. publicly opposed it, withdrawing from negotiations before the vote and warning of “reciprocal measures” to counteract any fees imposed on U.S. ships under the new framework. The U.S. State Department subsequently issued a communication rejecting the proposal and outlining potential actions against supporting nations, including regulations to address anti-competitive practices, visa restrictions, commercial penalties, additional port fees, and possible sanctions on officials advocating climate policies perceived to burden American consumers.
A motion to delay framework negotiations by a year, proposed by Singapore and tabled by Saudi Arabia, was approved by 57 countries, with 49 opposing and 21 abstaining. Industry participants expressed disappointment at the delay, highlighting the uncertainty it introduces to emissions reduction initiatives and investments. Maersk, a major shipping company, described the decision as “a loss of momentum for the shipping industry’s efforts to decarbonise” and emphasised the need for clarity on the future direction of the IMO’s work on the Net-Zero Framework.
Maersk further stated, “The energy transition of the shipping industry has never been an easy task. It requires action and support from the entire shipping ecosystem, including fuel producers, ship owners, regulators, and many more. Global regulations are a precondition to securing a level playing field in a global industry.”
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