MEPC 84: More states want to consider Liberian proposal without GHG pricing
IMO member states including Oman, Kuwait, Jordan, Somalia, Yemen and Tunisia have voiced support to revise currently approved emissions rules on the fourth day of MEPC 84 discussions.
IMAGE: IMO member state delegates sitting in front of the Marine Environment Protection Committee (MEPC) secretariat during a plenary session in London this week. IMO
The countries said a proposal submitted by Argentina, Liberia and Panama offers a starting point for further discussions on a “practical” Net-Zero Framework (NZF) that could help secure consensus among IMO member states.
In a February submission to the IMO, Argentina, Liberia and Panama said its proposed framework should replace the NZF that was approved by IMO member states in April 2025. Their alternative framework would remove greenhouse gas (GHG) pricing and revise the GHG Fuel Intensity (GFI) reduction trajectory.
Argentina, Liberia and Panama argued that the currently approved GFI threshold is too restrictive and they estimated it could result in GHG penalties of $300 billion by 2035. These penalties would disproportionately be paid by small- and medium-sized businesses and tramp ship operators, they argued.
Instead, their proposal sets GFI reduction targets derived from the actual cost, availability and market share of low-emission fuels, recalculated every five years, rather than targets aligned with the 2023 IMO GHG Strategy checkpoints.
They also proposed surplus units (SUs) as the only compliance mechanism — replacing the NZF's pricing system — with ships able to transfer, bank and borrow units to meet their GFI targets.
“Ships that outperform the applicable GFI Target will generate SUs, which may be transferred – exclusively through the IMO GFI Registry,” the proposal said.
“By [date, e.g. 30 April] following the end of each reporting year, the [shipping] company shall reconcile each ship's GFI position by surrendering SUs and/or applying banked or permitted borrowed units sufficient to eliminate any compliance deficit, together with the submission of verified emissions data and GFI calculations in the IMO GFI Registry,” it added.
Shipping-focused climate advocates have opposed the proposal.
The Liberian proposal would make fossil fuels more lucrative and particularly favour LNG, a representative from the Institute of Marine Engineering, Science and Technology (IMarEST) argued at the IMO plenary today.
The representative said the absence of caps on SUs could create volatile pricing, while the lack of reward mechanisms would discourage the green fuel transition.
“A technical-only measure… leaves the SU market uncapped, provides no revenue for rewards or just transition, and… carries the highest transition risk and cost of any architecture considered,” experts from the UCL Shipping and Oceans Research Group and RMI said in a joint study earlier this month.
By Konica Bhatt
Please get in touch with comments or additional info to news@engine.online
