The IMO’s March Meetings: what next for shipping?

9 Apr

This March, countries from around the world came together to discuss the measures that will be adopted to tackle shipping’s greenhouse gas (GHG) emissions. We asked our Policy Officer Blánaid Sheeran for her key takeaways from these meetings.

What were these meetings about?

Last month at the International Maritime Organization (IMO), representatives from Member States, industry and civil society came together for two weeks of key climate discussions: the 16th Intersessional Working Group on GHG Emissions (ISWG-GHG 16), followed by the 81st meeting of the Marine Environment Protection Committee (MEPC 81).

A large part of these meetings focused on the continued development of emissions reductions measures, which include a “basket of mid-term measure(s)”. These will be adopted by the IMO in 2025 and are key to getting international shipping on track to meet its recently revised GHG emissions reductions targets and effectively promoting a just and equitable transition. As previously agreed by Member States, the basket of measures will comprise both a technical element (e.g. a GHG fuel standard) and an economic element (e.g. a levy on GHG emissions, or feebate system).

These most recent meetings facilitated further discussion of proposed variations of the measures, but much is yet to be decided. Some key questions that remain are:

What form a global fuel standard will take and should it allow for flexible compliance (if a ship does not comply, should it be allowed to continue operating e.g. by paying a fine)?
What form should a pricing mechanism take and what should be done with its revenues?

Why do the meetings matter?

If an ambitious combination of measures is adopted, we could see more equitable climate action both in the shipping sector and beyond. A careful and well-informed selection of measures is absolutely critical to ensure that shipping takes an ambitious approach to reducing its climate impact while contributing to a just and equitable transition for the world’s most climate vulnerable countries.

The measures must include a stringent GHG fuel standard, established on a well-to-wake basis, accompanied by an ambitious GHG pricing mechanism.

An ambitious GHG pricing mechanism would:

Help to narrow the price gap between fossil fuels and zero-emission fuels;
Provide increased investment certainty in zero emissions fuels, technology and energy solutions across the sector; and,
Generate new and additional finances for adaptation and mitigation in countries most impacted by climate change, helping to promote a just and equitable transition that leaves no country behind.

The most ambitious proposal is that put forward by the Pacific Island States and Belize. This would set a flat rate GHG levy on the well-to-wake emissions of international shipping at an initial rate of no less than $150 per tonne of CO2 equivalent (CO2eq). Analysis by the World Bank estimates that such a levy could raise between $1 trillion and $3.7 trillion by 2050 ($40-$60 billion annually).

The stakes are incredibly high, and a crucial step to achieving a levy is representation in negotiations from key countries making the case for progressive measures. This round of meetings was defined by just such an increase in participation.

What were the highlights?

1. More representative participation – although we’ve got a long way to go

There were several States actively participating in the room or online who had previously not been able to attend the meetings. In particular, there was a significant increase in the participation from countries in the Caribbean region. Many of their impactful statements made it clear that for small island States, immediate, high-ambition action from the IMO is an absolute necessity to maintain the livelihoods of their inhabitants and protect their territorial integrity.

Alongside the continued leadership of Pacific Island States, the active participation of the Caribbean in discussions going forward will raise ambition and bring us ever closer to a robust basket of measures.

Nonetheless, there’s a long way to go before IMO decision making is fully representative: many climate vulnerable developing countries who have the most to lose if shipping continues on its polluting path, are not yet active in discussions. In many cases this may be due to resource and capacity restraints or simple inaccessibility of the London meetings.

It is crucial to ensure those countries can participate in discussions, for example through the IMO’s Voluntary Multi-Donor Trust Fund. This March, the scheme brought delegates from almost 30 countries into the room that otherwise would not have been able to attend. Encouraging more countries and organisations to contribute to the Fund is an important, tangible step we can take to ensure more climate vulnerable states are represented in future climate discussions at the IMO.

2. A (draft) first-of-a-kind legal framework

While we did not see much movement from countries on which measures should be selected (all proposals are still on the table), MEPC 81 did agree to an “Illustration of a draft possible outline of the ‘IMO Net-Zero Framework’ - Possible amendments to MARPOL Annex VI”. This skeletal framework provides an outline of how the measures might sit within the MARPOL Convention (the International Convention for the Prevention of Pollution from Ships), meaning that, for the first time, we have a basic idea of what the legal framework could look like.

Of course, there’s still a huge amount of work to be done and no decisions have been made as to which measure(s) will be adopted. Nonetheless, our CEO, Aoife O’Leary explains why this is an important achievement in itself in a recent op-ed.

What happens next?

There is still a lot to be decided. The final measures will be approved and adopted in 2025, entering into force in 2027. But we still have no concrete idea what it will look like. Over the coming months, there will be a lot of background work at the IMO and elsewhere to help whittle down the current options.

This includes a comprehensive impact assessment (already underway) of the various possible combinations of the individual measures on the table according to pre-determined factors and dissemination of its results. The results of this assessment will be key during future meetings, in particular MEPC 82 this September where we hope countries will build agreement on the specificities of the IMO’s mid-term measures.

Interested in more information as discussions develop? Follow us on Twitter or LinkedIn where we post regular updates on our work.