LONDON: Ahead of next week’s key meeting of the International Maritime Organization (IMO), the Clean Shipping Coalition is calling on member states to hold firm in their support for the Net-Zero Framework (NZF) – the UN shipping body’s long negotiated compromise climate agreement – in the face of “alternative proposals” that seek to undermine climate action by the shipping sector.
“While less ambitious than we had hoped for, the NZF’s broad political support from member states means it remains the best tool available to meet the IMO’s Greenhouse Gas Strategy goals on climate, decarbonisation and a just and equitable energy transition for the shipping industry, and must be adopted by the IMO this December”, said Clean Shipping Coalition President Lukas Leppert. “The result of multiple rounds of negotiations, the NZF is already by any measure, an acceptable compromise. Any further weakening would lead to a less effective, slower, and costlier transition”.
The shipping sector makes up 2-3% of global greenhouse gas emissions – comparable to the world’s fifth biggest emitting country, Japan. The IMO has committed to achieving its GHG Strategy goal, including its long-term goal of decarbonisation by 2050, its interim targets of a 30% reduction in absolute emissions by 2030 and 80% by 2040, and its commitment to a just and equitable transition.
Discussions during ISWG-GHG 22 (Intersessional Working Group on Reduction of GHG Emissions from Ships in London, 1-4 September) are expected to include IMO’s long negotiated compromise agreement, the Net-Zero Framework (NZF), and its proposed adoption at December’s Marine Environment Protection Committee (MEPC 85/ES.2). Approved during MEPC 83 in 2025, the NZF includes a “global fuel standard” (GFS), which requires ship operators to gradually decrease the amount of greenhouse gas emitted by shipping fuels – or pay penalties. The framework also introduces a mechanism that puts a price on a portion of greenhouse gases ships emit, giving the industry a clear financial incentive to reduce emissions in line with the global fuel standard. See also: IMO paper on the NZF – MEPC 85/3/8: Consideration And Adoption of Amendments to Mandatory Instruments: Amendments to MARPOL Annex VI.
“Shipping is the backbone of the global economy, with estimates of shipping trade’s market value topping $14 trillion, but as it’s also a major source of climate pollution, heating up our ocean and our planet, it must be part of the solution”, said Delaine McCullough, Shipping Program Director at Ocean Conservancy. “As ocean temperatures hit record highs again this summer, increasing storm intensity and threatening marine life, food supplies, and coastal communities, there’s no time for further delay in addressing the roughly one billion tons of carbon dioxide shipping spews into our atmosphere every year.”
“It’s taken years of negotiating and compromise by IMO member states to get to the Net-Zero Framework (NZF)”, added McCullough. “It may not be perfect, but it has the elements needed to eliminate the global shipping industry’s emissions by 2050 and help ensure that the countries facing the greatest climate risks with the least capacity to respond are not further harmed in the maritime energy transition. Adoption of the NZF ‘as is’ would be a huge step forward for our climate, communities, and ocean.”
“The Clean Shipping Coalition cannot support any option that does not include a financial GHG emission penalty and fund”, said Sönke Diesener, Senior Policy Officer Maritime Transport at NABU. “These economic measures are essential for incentivizing emission reductions, supporting the uptake of zero-emission fuels and technologies as well as for ensuring a just and equitable transition. The sector requires clear regulatory directions for the transition and the IMO now has the opportunity to deliver global planning security for the ramp-up of sustainable solutions.”
Further consideration of the development of the IMO Life Cycle GHG Assessment (LCA) framework which will determine well-to-wake emissions and sustainability criteria for global marine fuels is also included on the ISWG-GHG 22 agenda.
“If the IMO gives an advantage to methane-based fuels such as LNG and biomethane, as current submissions to ISWG are calling for, this would lock in shipping emissions of methane, a super pollutant, for decades to come”, said Andrew Dumbrille, Co-Director, Equal Routes. “The LCA guidelines must include sustainability criteria that account for biodiversity and human rights impacts, real world emissions factors for methane-based fuels, and reflect GHG emissions of indirect land use change caused by production of biogenic fuels.”
“With accelerated climate warming already driving devastating impacts around the world, such as record heatwaves, flooding, wildfires and droughts, there is no doubt that the industry must rapidly lower its greenhouse gas emissions”, said Anaïs Rios, Senior Shipping Policy Officer at Seas At Risk. “For the shipping sector, the question is no longer whether it needs to decarbonise, but how best to meet the goals of the International Maritime Organization’s (IMO) GHG (greenhouse gas) Strategy and to reach net zero by 2050. The industry must quickly evolve so that it acts as a shared good for people, rather than a key contributor to the climate crisis and the loss of health and livelihoods around the world. The best way to achieve this is for IMO member states to adopt the Net-Zero Framework in December.”
Following widespread support for the NZF at MEPC 84 in May 20226, the Clean Shipping Coalition stated that “IMO’s Net-Zero Framework is back on track”, but that supporters must remain “vigilant and strong in order to parry inevitable future attacks and attempts to further delay the process of adoption, which is scheduled for early December”.
Those threats have now materialized in the form of ‘alternative’ proposals from a number of IMO member states. Having analysed the available proposals, the Clean Shipping Coalition has found two of them particularly unfit for decarbonization: those submitted by Liberia and Japan. (The other proposals are covered in the notes below.)
Liberia
Instead of setting reduction targets on a path to net zero, the submission from Liberia – the world’s largest flag state – would allow ships to stick to conventional fuels if they think cleaner alternatives are too costly or unavailable.
Additionally, Liberia’s proposal puts greater emphasis on trading of surplus units, while removing the idea of mandatory payments into a Net-Zero Fund. Without reduction targets or financial incentives, this would not cause a shift in the shipping sector beyond business-as-usual, while the lack of available funds would make it impossible to address disproportionately negative impacts on states.
“By failing to ensure a just and equitable transition on top of its poor climate performance, the Clean Shipping Coalition finds that Liberia’s proposal constitutes a fundamental redesign which will fail to deliver on the goals set out in the 2023 IMO Greenhouse Gas Strategy”, said Leppert.
Japan
Japan’s proposal would fundamentally fail to deliver on the goals set out in the GHG Strategy 2023. Japan has put forward a questionable alternative to compliance payments flowing into a centralized fund, which would allow shipowners to direct payments to projects of their own choice.
“Without proper oversight from a governing board, and a clearer focus, the system proposed by Japan risks creating a scheme where money is invested into projects that do little to reduce emissions”, said Alex Springer, Interim Shipping Director at T&E. “Left to its own devices, the industry will continue its reliance on dead-end ‘solutions’ like fossil LNG or crop biofuels, for an expensive, long-term fossil lock-in. Real solutions such as e-fuels and electrification require investment certainty, long-term targets, and robust governance – all of which the proposal is lacking.”
The Clean Shipping Coalition is calling for a central fund administered by the IMO or another independent body and sufficient contributions to ensure a just and equitable transition. In order to leave no one behind, states facing disproportionately negative impacts like small island developing states and least developed countries need financial support – which they made abundantly clear at previous negotiations. Japan’s proposal would clearly fail to deliver, haemorrhaging support from one group of states in an attempt to appease another.
Japan’s proposal also carries serious procedural risks. As it was not circulated six months ahead of the meeting (as is the normal requirement), it cannot be adopted under normal rules at MEPC 85.
The IMO already delayed its planned timetable of establishing a climate framework for global shipping in 2025, by adjourning MEPC ES.2 for a year. This delay has wasted time as the planet warms, emissions of greenhouse gases from global shipping continue unhindered, and delayed investments will lead to a hastier and in turn costlier transition. By diverting attention from circulated proposals the submission from Japan risks throwing the IMO further off-course, and would provoke a loss of trust in the organisation’s capacity to police international shipping and deliver on its own goals.
“Both the Liberia and Japan proposals are wrecking balls – aimed at the heart of shipping climate action, and will prevent necessary action, cause higher total costs, will not support a just and equitable transition, and ultimately will fail to meet the obligations the shipping sector faces”, said Leppert. “Both proposals are designed to placate those that do not think shipping climate action is needed, and serve only to undermine what has been achieved so far. Getting to the Net-Zero Framework is the result of multiple years of negotiations. The result is supported by a comprehensive impact assessment, and has the ability to deliver on the goals of the IMO GHG Strategy”.
“Forget the distractions. Now is the moment for the IMO and all its member states to have the courage to protect and adopt the Net-Zero Framework ‘as is’”, concluded Leppert.
Notes: Other alternative proposals
Brazil Proposal
Brazil’s proposal at best can be seen as a weakened version of the NZF: it delivers fewer GHG reductions in the short term, is associated with higher total costs of the transition due to a later kickoff and steeper targets from 2040, and will not gather sufficient financial contributions at the outset. Furthermore, success of delivering a just and equitable transition hinges on the concrete configuration of the proposed “facility” and whether it will be able to support countries facing disproportionately negative impacts or just become an empty shell. Overall, as Brazil’s proposal presents a weaker and overall costlier version of the NZF, which itself is a compromise that doesn’t achieve the IMO’s own GHG strategy, the NZF should be favoured over the Brazil proposal.
Pacific Proposal
The proposal submitted by Pacific IMO members, which concerns introducing a carbon levy for all GHG emissions of shipping, provides a strong economic incentive for ships to reduce their emissions, while generating sufficient financial resources to support the maritime energy transition, and at the same time ensure that no countries are disproportionately harmed by negative impacts of the transition with everyone benefiting from the economic opportunities the energy transition provides.
The Clean Shipping Coalition supports the Pacific proposal, as it showcases which approach has the best outcome and to highlight that the NZF ‘as is’ is already a compromise after years of negotiation that shouldn’t be watered down further. It can also be used to show that the limits of possible policy frameworks are not the NZF and Liberia, but that the NZF is indeed the middle ground, supported by a wide range of member states.
About the Clean Shipping Coalition:
The Clean Shipping Coalition is an international association of civil society environmental protection organisations, and the only one with a purely shipping focus.
We help develop and drive global environment and climate laws on shipping, principally at the United Nation’s shipping regulator, the International Maritime Organization.
