Shipping Associations Call for Unity as IMO Net Zero Debate Approaches
As delegates head to London for MEPC 84 and the next round of talks on the Net Zero Framework, shipping industry heavyweights are lining up to endorse the universal authority of the IMO and the value of a single global rulebook - but as ever, opinions vary on the climate regulations at issue. The main shipowners associations - ICS, BIMCO, CLIA, Intercargo, WSC and Intertanko - say that they remain committed to the NZF, offering both input and support; the world's top three flag registries - which represent half of all global tonnage - are encouraging member states to look beyond the NZF and consider something different.
All of these stakeholders are unanimous in calling for unity behind IMO as a global regulator, citing the unique advantages of a worldwide level playing field. The ICS-led group encourages member states to "consider all options to achieve a global agreement," thereby preempting a patchwork of different national emissions requirements in different places. The EU's complex regional regulation for greenhouse gas emissions is often cited as a cautionary example of what might face shipping if it does not achieve a "fit-for-purpose" global ruleset at IMO first.
Specific industry-association requests for the NZF include acceptance of the use of LNG, LPG, "sustainable biofuel" (including biomethane), ammonia, nuclear power and onboard carbon capture, even where questions remain about feasibility or safety. The coalition also wants to emerge from the meeting with the conclusive regulatory certainty that clean fuel producers need, giving energy companies the predictability they need to invest and scale up. The coalition also wants to see effective enforcement to prevent cheating (a temptation when compliance costs are high) and ensure a level playing field.
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The other coalition, led by the top three flag states and joined by the world's leading tanker owners, asserts that the divide on the NZF has been growing and that another solution is needed. "The coalition calls on Member States and the [IMO] to give serious and open-minded consideration to the alternative proposals that have been submitted, and to use MEPC 84 as the platform for the alignment the industry has been waiting for," the flag-led coalition said in a statement. The details of the alternative proposals were not released, but the one at issue is said to be more accepting of LNG than the original NZF.
The U.S. delegation has made clear that it will not accept the NZF's carbon pricing mechanism in any form, and last month it asked the IMO to abandon further consideration of the agreement. Concerted American opposition led to a delay of the deal last October; at that meeting, the U.S. used threats of retaliation against other member states in order to compel compliance. But circumstances have changed in the intervening months, notably after a U.S. Supreme Court decision curtailed the White House's legal ability to change nation-by-nation tariff levels at will. It is unclear whether U.S. negotiators will be able to exert as much leverage on other member states this time.
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