Global plan for maritime shipping leaves industry short of net zero goal

Key points:

The International Maritime Organization has approved an emissions intensity fuel standard.
The system offers shipping companies options to purchase credits if they miss targets.
Environmental groups project that the framework won’t achieve net zero.

The International Maritime Organization (IMO) decided on Friday to introduce an emissions levy on international shipping. This move has been met with mixed reactions, as some see it as a positive step forward while others criticize it for its flaws in accounting for emissions. The IMO’s Marine Environment Protection Committee concluded discussions in London, resulting in a compromise due to divisions among negotiators.

The IMO had previously committed to achieving net zero emissions in the industry by around 2050, with the committee tasked to finalize a mechanism to achieve this goal. European Union nations pushed for strict emissions standards, while a group including Brazil and China advocated for more flexible approaches.

The agreement reached is a hybrid mechanism resembling emissions trading schemes. Large vessel owners will face increasing emission-intensity requirements, with potential fines for failing to meet targets. The system is set to be in place by 2027, pending approval at a later IMO meeting, and is described as the first global tax on greenhouse gas emissions.

Environmental organizations present at the negotiations expressed concerns, particularly regarding biofuels and their indirect impacts on land use. Some groups doubt whether the financial penalties and fuel targets will be enough to transition the industry to net zero emissions by 2050.

The negotiations faced challenges, including the withdrawal of the U.S. delegation by President Donald Trump and the need for a vote on the framework, which is uncommon for the IMO. Despite criticisms, organizations like the Global Maritime Forum acknowledge the agreement as an example of multilateralism in action.