During the Marine Environment Protection Committee meeting (MEPC 80) held in London on July 7, 2023, a new milestone was achieved in the pursuit of reducing greenhouse gas (GHG) emissions from shipping. The revised IMO GHG reduction strategy marks the beginning of a fresh endeavour to limit emissions in this sector.
The strategy outlines several ambitious goals, with the most significant ones being:
- Achieving net-zero GHG emissions by approximately 2050.
- Increasing the utilisation of zero or near-zero GHG emissions technologies, fuels, and energy sources to constitute at least 5%, and striving for 10%, of the energy consumed by international shipping by 2030.
To provide a clear path towards decarbonisation, the strategy also includes indicative checkpoints:
- Reducing the total annual GHG emissions from international shipping by a minimum of 20%, with an aim for 30%, by 2030 compared to the emissions in 2008.
- Decreasing the total annual GHG emissions from international shipping by at least 70%, with an aspiration for 80%, by 2040 compared to the emissions in 2008.
These indicative checkpoints will play a crucial role in the development of implementing measures. They serve as milestones on the trajectory towards achieving the net-zero GHG emissions goal by 2050, and considering that 2040 is just 17 years away, it becomes evident that ships currently being constructed will be in service during that period. With the commitment to develop mandatory measures by 2025 to implement this pathway, the shipping industry is poised for significant changes.
One of the agreed-upon mandatory measures is the implementation of a fuel GHG-intensity standard. This standard aims to set progressively stricter limits on the GHG-intensity of fuel used by ships each year. Additionally, the possibility of incorporating a fleet averaging mechanism is being considered to ensure practicality. However, due to the expected growth of the shipping fleet between now and 2040, it is anticipated that the average reduction of GHG emissions by ships will reach approximately 90% by that time. It is imperative for all stakeholders to address the issue of adopting zero GHG fuels.
To complement the fuel standard, an economic instrument to price emissions is being contemplated. The specifics of this instrument have yet to be determined, pending a comprehensive impact assessment agreed upon during MEPC 80.
These mandatory measures are set to take effect from 2027.
It is crucial for all stakeholders to comprehend the implications of this strategy on both existing and future vessels.
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