The Asian Shipowners’ Association (ASA) strongly emphasized the importance of R&D funding such as the IMO Maritime Research Fund (IMRF) to advance the industry transition to net-zero.
s ASA supports industry efforts to reduce emissions from international shipping, it believes that the only way to achieve ambitious net zero targets would be through the adoption of the IMO Maritime Research Fund (IMRF), which will guarantee funding for the R&D necessary to accelerate the development of zero emission ships.
Earlier, in December 2019, shipowner associations representing the global maritime transport industry submitted a proposal to the IMO to form the world’s first collaborative shipping R&D programme for pushing work of CO2 emissions reduction from international shipping. The proposal includes core funding from shipping companies across the world of about USD 5 billion over a 10-year period.
The IMRF, which will be funded by mandatory R&D contributions from shipowners globally via a levy on actual fuel consumed, aims to be the most efficient tool to decarbonise the industry, as because these are fixed contributions that demonstrate industry’s commitment to decarbonisation, they offer a measure of stability to support for R&D efforts and will be relatively insulated from external shocks that may result in increased volatility in carbon markets.
In addition, the IMRF could also have the flexibility to allocate a portion of the funds collected to support direct mitigation for states that are most affected by climate change.
To further promote the transition to net zero, ASA notes that the IMRF could also be considered along with a broader carbon levy for international shipping to help narrow the gap between conventional and zero-carbon fuels and support IMO member states’ efforts to develop and deploy the infrastructure that will be necessary to support a zero-carbon fleet.
The IMRF can be applied fairly to a global industry, and is directly linked to the amount of fuel consumed and therefore carbon emitted. Furthermore, as a long-term measure, the IMRF will be relatively resistant to short-term shifts in policy and market volatility, which is increasingly important as the events of the past few weeks have shown
said Ms. Caroline Yang, Chair of the ASA SNEC.
Highlights of the proposal:
- A new non-governmental Research & Development organisation to pave the way for decarbonization of shipping.
- Core funding from shipping companies across the world of about USD 5 billion over a 10-year period.
- To accelerate the development of commercially viable zero-carbon emission ships by the early 2030s.
These ambitious IMO targets include an absolute cut in the sector’s total greenhouse gas emissions of at least 50% by 2050, regardless of trade growth, with full decarbonisation shortly after.
The message that maritime decarbonization needs financial instruments, taking into account the needs of developing countries, to ensure no one is left behind, was highlighted during a panel debate at the World Oceans Summit on 1st of March which focused on financing shipping decarbonization.