47 IMO members back GHG levy for shipping
47 of the IMO’s 176 member states have jointly backed a GHG pricing mechanism to be included as the economic element in the IMO’s planned basket of mid-term measures.
PHOTO: Headquarters of the International Maritime Organisation in London. Getty Images
Most of these countries, including the EU bloc, Japan, Pacific and Caribbean island nations, Liberia, Bahamas and Panama, were already supporting a levy. New supporters include African maritime majors such as Nigeria and Kenya, as well as the UK, Seychelles and South Korea, according to a social media post by the Micronesian Center for Sustainable Transport (MCST).
Until last year, the GHG pricing mechanism was supported by 39 countries. It “marks a significant increase in support,” with 47 nations now backing the proposal, MCST noted.
The proposal has also gained backing from the International Chamber of Shipping (ICS), a global trade association for shipowners and operators.
The countries and ICS have consolidated their respective proposals and submitted them for consideration alongside the draft of Chapter 5 of MARPOL Annex VI, which outlines regulations for the IMO’s net-zero framework.
The proposed rates for the levy are $18.75/mt of CO2-equivalent (mtCO2e), $100/mtCO2e, and $150/mtCO2e, calculated on a well-to-wake basis. The IMO working group must now finalise the pricing levels and revenue disbursement mechanisms associated with the economic element.
“The co-sponsors strongly believe that the economic element of the basket of mid-term measures should have at its heart a levy/contribution on the GHG emissions from ships,” the new proposal stated.
This mechanism will help to narrow the price gap between conventional fuels and zero- or net-zero emission fuels. It is also intended to generate revenue to support the adoption of net-zero emission fuels and technologies, the proposal explained.
This development means that three of the world’s largest shipping registries by deadweight tonnage, Liberia, Panama and the Marshall Islands, along with other major registries such as Bahamas, Malta, Greece and Japan, now support a GHG levy.
However, some IMO member states like China, Argentina, Brazil, Norway, South Africa, the UAE and Uruguay, have not yet endorsed any pricing mechanism.
“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," the ICS explained.
"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,” it added.
This proposal is expected to be reviewed at the next Maritime Environment Protection Committee (MEPC 83) meeting in April.
By Konica Bhatt
Please get in touch with comments or additional info to news@engine.online
