The International Maritime Organization (IMO) is on the cusp of striking the world’s first global carbon pricing deal for any industry, the World Shipping Council (WSC) pointed out on a statement.
To succeed, the measure must help bridge the price gap between fossil fuels and cleaner alternatives, including zero and near-zero (ZNZ) fuels. That’s essential to drive investment in green energy and fuel supply, and to build the economies of scale needed to reduce cost over time.
Joe Kramek, President and CEO of the World Shipping Council commented that it if that happens, it’ll be a major milestone for climate policy and a turning point for shipping.
However, key elements of the agreement remain to be resolved. These will determine how effective the agreement will be in delivering a regulatory regime that enables an energy transition in the global fleet.
A key issue still to be resolved is how and what green fuels will be incentivised from the revenue generated by the proposed measure. If those decisions aren’t made this week, the fuel market and fuel buyers won’t have any clearer signal to invest.
…said Bryan Wood-Thomas, head IMO representative and Vice-President for Environment and Climate, WSC, adding that the industry needs certainty, and needs it now.
Furthermore, Bryan Wood-Thomas highlighted that these decisions cannot be deferred to guidelines to be developed two years from now and every few years thereafter. Without a clear incentive for cleaner fuels, there is the risk of stalling momentum just as greener options are beginning to scale up.
The World Shipping Council says it has been working with Singapore and other IMO member states to build consensus around a global proposal capable of driving decarbonisation in shipping.
“Liner shipping is already preparing for the clean transition” Kramek said.
Nearly 200 vessels capable of running on renewable fuels are in operation today. By 2030, another 700 will join them. That’s billions of dollars already invested in cleaner technologies. But these ships won’t be able to run on green fuels without a regulatory framework that makes ZNZ fuels commercially viable and available.
…Kramek concluded.
