December 21, 2022
The MEPC79 is now finalised, and these are the key outcomes regarding the reduction of GHG emissions from ships on a commercial level.
The IMO, acting as a global regulator, can steer the industry towards decarbonisation provided it acts quickly and precisely. So far, the industry has been moving faster than the IMO both with regards to setting higher ambitions, but also taking initiatives towards the development of zero-carbon fuels and infrastructure.
Let’s take a look at what has happened and what we can expect going forward.
The IMO Initial Strategy in 2018 set out “to peak GHG emissions from international shipping as soon as possible and to reduce the total annual GHG emissions by at least 50% by 2050 compared to 2008 whilst pursuing efforts towards phasing them out as called for in the Vision as a point on a pathway of CO2 emissions reduction consistent with the Paris Agreement temperature goals.”
Recent science publications on climate change stressed that urgent action is needed to achieve the Paris Agreement temperature goals. The IMO target of 50% emissions reductions by 2050 is not ambitious enough to meet the Paris agreement goals and revision of the strategy is now essential.
The majority of IMO nations seemed to support the revision of the Initial Strategy and showed support towards measures and initiatives targeting zero emissions from ships by 2050. Specifically, discussions focused on strengthening the 2030 ambition, deployment of low and zero carbon fuels as soon as possible, investments in human resources along the value chain to kick-start the decarbonisation process as well as the inclusion of green corridors in the revised IMO strategy.
In addition, several studies highlighted that delays in the start of emissions reductions in shipping could add to the total cost of shipping decarbonisation. The United Kingdom’s review of evidence on emission reduction pathways´ estimated delays could lead up to an additional $100 billion in total costs, while DNV’s ‘Maritime Forecast to 2050’ advised annual fuel infrastructure costs range between $28-90 billion. The ´Science based target setting guidance for the maritime transport sector’ report pointed out that in an industry with long-life assets where investments can be extremely costly, it is imperative to create an environment where stakeholders feel safe to take action towards a concrete ambition, rather than one which could potentially be obsolete in a few years. Whilst setting up short term goals can help break down the decarbonisation process, it is important that they are set out in line to achieve zero emissions by 2050.
The final revision of the Initial Strategy is expected at MEPC80 in summer 2023.
The IMO has considered various proposals for mid-and-long term measures and following discussions, it seems member states are leaning towards a global GHG levy system and a GHG Fuel standard in an effort to combine economic and technical features in their approach.
Discussions will take place next year and a final decision on which measure to proceed with will be taken at MEPC80 in 2023.