The recent IMO agreement on international shipping emissions has been met with mixed reactions. Led by Pacific Island States, a proposal for a high priced, flat-rate levy on all international shipping emissions was tabled. This proposal aimed to create an incentive for emissions reductions while generating revenue to address the impacts of climate change on Small Island Developing States and Least Developed Countries.
After two weeks of negotiations, the IMO reached a historic agreement on legally-binding measures to reduce emissions from international shipping. This agreement signifies a new form of multilateralism, where countries collaborate on global measures to combat emissions from a high-emitting sector. However, the final agreement fell short of expectations for many delegates.
The core mechanism of the regulation is a two-tiered GFS system, where ships exceeding emission limits will face penalties. Additionally, there is a reward mechanism for ships utilizing zero or near-zero emission technologies. Despite these measures, the agreement does not align with the IMO’s 2023 strategy and fails to meet emissions reduction targets.
The IMO’s emission reduction target of 20% by 2030 is not expected to be achieved, with projections indicating only a 10% reduction. Furthermore, the low pricing of emissions may lead some vessel operators to simply absorb the costs rather than investing in emission reduction technologies.
In terms of climate justice and an equitable transition, the revenue raised from the agreement is insufficient to support the decarbonization of the international shipping sector. The focus on rewarding existing investments in emission-reducing technologies may hinder additional efforts to reduce emissions.
While the IMO’s agreement sets a foundation for climate action in the shipping sector, there is a need to raise the bar for more ambitious measures. The international shipping industry must play a crucial role in global climate action, aligning with the goals set at COP29 to triple finance for developing countries.
Emma Fenton, the senior director of climate diplomacy at Opportunity Green, emphasizes the importance of leveraging the momentum from the IMO agreement to drive further climate action. With the world’s eyes on the shipping sector, it is essential to heed the calls from climate-vulnerable countries and accelerate the pace of change required to address the climate crisis effectively.
