The IMO’s Intersessional Working Group on the Reduction of GHG Emissions from Ships (ISWG-GHG 18), held from February 17-21, has concluded, sparking discussions and calls for further action within the maritime industry.
The Intersessional Working Group continued discussions on proposals, using the draft text for an “IMO net-zero framework” agreed at the last meeting of the Marine Environment Protection Committee MEPC 82, as the basis. This draft text integrates inputs and proposals from Member States and international organizations on possible amendments to be made to the International Convention for the Prevention of Pollution from Ships (MARPOL, Annex VI).
The IMO’s 2023 GHG Reduction Strategy commits Member States to adopting mid-term measures to reduce GHG emissions from ships in late 2025, including:
- a technical element, namely a goal-based marine fuel standard regulating the phased reduction of a marine fuel’s GHG intensity; and
- an economic element, on the basis of a maritime GHG emissions pricing mechanism.
These amendments, if adopted, would incorporate the proposed mid-term measures into the treaty, which has 107 Parties representing 97% of world merchant shipping tonnage.
The ISWG-GHG 18 meeting has advanced key elements of the MARPOL Annex VI amendment, keeping the process on track for finalization at MEPC 83, but significant decisions remain on the economic measures.
… said Marie Fricaudet, PhD Student at the UCL Energy Institute
The aim of ISWG-GHG 18 discussions was to further develop and streamline the draft amendments to MARPOL Annex VI. Key topics covered include global marine fuel intensity regulations, the economic mechanism’s structure, organizational and operational aspects of the proposed ‘IMO Net-Zero Fund’, revenue disbursement, and potential food security impacts.
Countries must demonstrate leadership by agreeing on ambitious, enforceable fuel standards and a greenhouse gas levy that slash shipping’s impact on the climate, and which cannot be watered down in last minute compromises.
… commented Delaine McCullough, Ocean Conservancy’s Shipping Emissions Policy Manager and President of the Clean Shipping Coalition.
Key outcomes
Universal levy on GHG emissions
No final agreement was reached on a universal levy on ships’ GHG emissions, though it is widely supported by the shipping industry for achieving net-zero emissions by 2050. About three-quarters of IMO States support the GHG contribution system proposed by the ‘50-plus group’ of governments and ICS, but opposition from countries like China and Brazil remains.
Dr Annika Frosch, Research Fellow at the UCL Energy Institute, said that support for the levy continues to grow, with 66% of MARPOL Annex VI signatories. This reflects a diverse coalition that includes key flag states, including backing from African nations, Small Island Developing States (SIDS), and Least Developed Countries (LDCs).
Agreement on IMO fund
Governments broadly agreed to establish an IMO Fund, expected to generate billions annually from ship GHG charges. The fund will provide financial incentives for first movers and ships using low-emission fuels such as green methanol, biomethane, green ammonia, and sustainable biofuels to close the cost gap with conventional fuels.
GHG fuel standard
Key details of the proposed GHG intensity fuel standard remain unresolved. ICS’s proposal for a simpler GHG surcharge fee for ships unable to comply due to fuel availability constraints is still under consideration. Many developing countries support this approach over a complex compliance trading system. Another issue is whether different shipping companies will be allowed to pool compliance due to limited availability of compliant fuels.
While ICS is broadly satisfied with the progress made on a radical new package of global GHG reduction regulations, including a GHG emissions pricing mechanism, much work urgently remains to be done. But despite divergence on many issues, it is encouraging that negotiations continue in a positive and cooperative spirit.
… said Guy Platten, Secretary General of the International Chamber of Shipping (ICS)
The Working Group agreed to keep all proposals for an economic element (GHG emissions pricing mechanism) under consideration and acknowledged potential “bridging options” suggested by some Member States. Efforts will continue toward defining amendments to MARPOL Annex VI that could achieve consensus approval at the next session of the Marine Environment Protection Committee (MEPC 83) on 7-11 April 2025.
Delegations reaffirmed their commitment to continue exploring possible ways to converge their positions and find common ground.
After reviewing the draft IMO net-zero framework, the Chair, in consultation with the Secretariat, prepared an updated version of the proposed MARPOL Annex VI amendments. This version consolidates areas of agreement and introduces new possible bridging options for further discussion. It will be annexed to the Group’s report to MEPC 83 as a “work-in-progress”, without preempting future changes, and will be further considered at the 19th meeting of the Intersessional Working Group (1-4 April 2025), ahead of MEPC 83.
Any GHG obligations should be set out in the form of clear, legally binding regulations. While there are tough conversations to have, it is better to have those conversations now and ensure the measures agreed have the integrity and clarity required to be effective. While guidelines play a role in shaping the path for implementation, we need to have regulations put in place to create a level playing field,
… Bryan-Wood Thomas, WSC Vice-President Environment and Climate, concluded.
