GHG emissions pricing mechanism proposal backed by 47 nations

A group of 47 IMO member states and the International Chamber of Shipping (ICS) have submitted text to the IMO outlining a global greenhouse gas (GHG) emissions levy for shipping. The submission to the Working Group on Reduction of GHG Emissions from Ships (ISW-GHG) would see ships pay an annual levy per tonne of CO2-equivalent emissions into a fund to support the development and adoption of zero carbon fuels in shipping.

The document, which includes draft wording for MARPOL annex VI amendments, will be considered at the 18th meeting of ISWG-GHG in February ahead of a critical meeting of the Marine Environment Protection Committee (MEPC 83) in April 2025. To meet the timeline set out in IMO’s Revised GHG Strategy, the mid-term measure would need approval at MEPC 83 in order for adoption at an extraordinary meeting of MEPC later this year to enable entry into force in 2027.

The aim of the GHG levy is to support the adoption of more expensive low carbon fuels in shipping by reducing the price gap to the cheaper, more polluting fossil fuels commonly used by ships. The text contains three sample values for the levy, $18.75, $100, and $150 per tonne of well-to-wake CO2 equivalent emissions. Shipping nations among the proposal’s supporters include Greece, Japan, and Korea, and major flag states the Bahamas, Liberia, Marshall Islands, and Panama. All EU nations and the European Commission also support the text.   “The industry fully supports the adoption by IMO of a GHG pricing mechanism for global application to shipping,” said ICS secretary general Guy Platten. “The joint text put forward by this broad coalition is a pragmatic solution and the most effective way to incentivise a rapid energy transition in shipping to achieve the agreed IMO goal of net zero emissions by or close to 2050. We are very pleased that such a large and diverse group of nations now firmly supports a common approach to maritime carbon charging.  

“This proposed joint text has been hard fought and is broadly based on ideas which ICS has been advocating for the past ten years. While a large number of governments now support a universal flat rate GHG contribution by ships – or something similar – a minority of governments continue to have concerns. Working in co-operation with all IMO Member States we will do our best to allay such concerns during the final stages of these critical negotiations about regulatory text.”