Shipping emissions: how is it handled?

• The International Maritime Organization (IMO)’s Marine Environment Protection Committee (MEPC-83) aimed to adopt a Market-Based Measure (MBM) for global shipping emissions.

• Five proposals were presented: a fixed levy per tonne of CO₂ emitted, a market-driven approach, a fixed Greenhouse Gas (GHG) levy, a bridging mechanism, and an enhanced version of India’s model.

• The U.S. Trump administration, which had withdrawn from the Paris Agreement, did not participate in the IMO deliberations and warned of “reciprocal measures” if the EU-backed uniform carbon levy was passed.

• The MPEC-83 voted 63 to 16 in favor of accepting Singapore’s hybrid model as the IMO’s Net Zero Framework, making international shipping the first global industry to adopt a mandatory emissions levy framework.

• The decision is not final yet, and the path to implementation is far from straightforward. The amendment needs to be amended Annex VI of the MARPOL convention, which will undergo a six-month circulation period among all contracting parties to MARPOL.

• The outcome remains uncertain with 63 votes in favour, 16 against, and 22 abstentions, highlighting the challenge the IMO faces in crafting a universally acceptable emissions framework.

Green Shipping and Global Emissions

• Shipping is a significant contributor to global emissions, emitting approximately one billion metric tonnes of greenhouse gas (GHG) annually.

• The International Maritime Organization (IMO) has implemented emissions-reduction measures to align with the 13th UN Sustainable Development Goal and the Paris Agreement.

• The IMO has adopted technical measures like the Energy Efficiency Design Index and the Ship Energy Efficiency Management Plan to reduce GHG emissions from ships.

• The IMO has set a target for reducing carbon intensity by at least 40% by 2030 and 70% by 2040, aiming for net-zero emissions by 2050.

• The principle of ‘common but differentiated responsibilities and respective capabilities’ (CBDR-RC) has been gradually erosion, with developed nations expected to bear greater burdens.

• India is likely to benefit from the new Maritime Biodiversity Management (MBM) framework, which could reduce India’s maritime logistics costs and increase its fuel expenditure.

• India is investing heavily in green hydrogen through its National Hydrogen Mission, which meets the IMO’s reward thresholds for green fuels.

• The adoption of a MBM by the IMO represents a significant milestone in the journey towards decarbonisation, setting a powerful precedent for other global sectors.