Context:
The International Maritime Organization (IMO) has approved a draft Net-Zero Framework aimed at reducing greenhouse gas (GHG) emissions from the shipping sector, with a goal of achieving net-zero emissions by 2050.
Key Features of the Framework
- Legal Basis:
- New Chapter 5 of MARPOL Annex VI (Prevention of Air Pollution from Ships).
- Global Fuel Standard (GFI):
- Requires ships to reduce GHG fuel intensity per energy unit used, based on a well-to-wake model.
- Carbon Pricing:
- Ships exceeding GFI limits must purchase remedial units, while low-GHG ships can earn surplus credits.
- IMO Net-Zero Fund:
- Redistributes carbon revenues to:
- Reward zero-emission ships.
- Fund R&D, capacity building, and climate resilience in Small Island Developing States (SIDS) and Least Developed Countries (LDCs).
- Redistributes carbon revenues to:
- Coverage:
- Targets ships over 5,000 GT (gross tonnage), which are responsible for 85% of maritime CO₂ emissions.
Significance of the Framework
- First Global Sector-Wide Regulation:
- Unifies global emissions caps and carbon pricing across international waters.
- Drives Low-Carbon Innovation:
- Encourages adoption of green fuels, onboard CCS, and hybrid technologies.
- Climate Alignment:
- Supports the Paris Agreement goals and the 2023 IMO Strategy.
- Equity Focused:
- Provides support to vulnerable nations through climate financing and technology transfer.
- Energy Transition Catalyst:
- Encourages investment in alternative fuels such as ammonia, methanol, and hydrogen.
