Wide Agreement for Proposed GHG Emissions Pricing Mechanism
The International Chamber of Shipping (ICS) has joined 47 governments in a joint submission to the final round of negotiations at the IMO on a GHG emissions pricing mechanism for international shipping.
The joint text is supported by major shipping nations such as Greece, Japan, Korea and the United Kingdom, the world’s largest flag States including Bahamas, Liberia, Marshall Islands and Panama, all EU States (and the European Commission), other African countries such as Nigeria and Kenya, plus Small Island Developing States from the Caribbean and the Pacific.
The submission sets out convergent regulatory text for amendments to the IMO MARPOL Convention, which will require shipping companies operating ships on international voyages to make GHG contributions per tonne of CO2e emitted to a new “IMO GHG Strategy Implementation Fund”.
The submission offers options for the levy saying it would be set “at a rate of [USD 18.75] [USD 100] [USD 150] per tonne of CO2e emitted on a life cycle basis.”
The purpose of the charge is to reduce the cost gap between zero/near- zero GHG emission fuels (such as green methanol, ammonia and hydrogen) and conventional marine fuels, to incentivize their uptake. Revenue generated will be used to reward the production and uptake of new fuels, whilst also providing billions of US dollars annually to support the maritime GHG reduction efforts of developing countries.
“While a large number of governments now support a universal flat rate GHG contribution by ships – or something similar – a minority of governments continue to have concerns. Working in co-operation with all IMO Member States we will do our best to allay such concerns during the final stages of these critical negotiations about regulatory text,” said ICS Secretary General, Guy Platten.
The proposal will be considered at the IMO in the week of 17 February 2025 at ISWG-GHG 18. If the MARPOL amendments are approved by IMO in April 2025, they should enter into force globally in early 2027, with the collection of annual GHG contributions from ships commencing in 2028.
The current list of co-sponsors of the proposed MARPOL text includes: Austria, Bahamas, Belgium, Bulgaria, Croatia, Cyprus, Czechia, Denmark, Estonia, Fiji, Finland, France, Georgia, Germany, Greece, Hungary, Ireland, Italy, Jamaica, Japan, Kenya, Latvia, Liberia, Lithuania, Luxembourg, Malta, Marshall Islands, Montenegro, Netherlands, Nigeria, Palau, Panama, Poland, Portugal, Republic of Korea, Romania, Slovakia, Slovenia, Solomon Islands, Spain, Sweden, Seychelles, Tonga, Tuvalu, Ukraine, United Kingdom, Vanuatu, the European Commission, International Chamber of Shipping.
