Shipping stakeholders have expressed disappointment with an International Maritime Organization agreement that sets out measures to reduce greenhouse gas emissions by the end of 2026.
But maritime industry players told TradeWinds the decision will allow the debate to move to more ambitious targets and to other parts of the CO after 2026 to relocate2 Reduction puzzles, such as the growing demand for a CO2 tax.
As TradeWinds reported Tuesday, the IMO’s Marine Environment Protection Committee (MEPC) has reached an agreement that uses a mechanism to reduce the CO2 intensity of existing ships by 2% every year from 2023 to 2026.
The agreement on the Carbon Intensity Indicator (CII), which did not have to be concluded within the framework of the MEPC meeting until yesterday, would initially aim for an annual improvement in CO2 intensity of 1% by the end of 2022.
“What came out today was very disappointing,” said Torvald Klaveness managing director Lasse Kristoffersen on Tuesday.
“It is a reminder that the IMO is unable to implement the necessary changes. The IMO’s ambitions to reduce CO2 emissions are already outdated, and today’s decision doesn’t even match the level of the IMO’s outdated ambitions. “
Engebret Dahm, managing director of the Norwegian shipping company’s Oslo-listed spin-off Klaveness Combination Carriers, said the IMO’s move actually reduced incentives for shipping companies to take measures to reduce their carbon footprint, as the CII doesn’t control the amount of cargo carried takes into account the ships or their ballast spacing.
But Sveinung Stohle, CEO of Hoegh LNG, called on the shipowners to stand behind the IMO’s move.
After all, the IMO is a consensus-oriented organization that can only move forward with compromises.
“Those who, like us, are very ambitious for the environment have higher goals, and this decision does not prevent companies from doing more than necessary,” said Stohle, whose company owns a fleet of LNG ships.
Lars Pedersen, deputy general secretary of the shipping organization Bimco, pointed out that the future review of the CII after 2026 would allow for more ambitious goals for the future.
“The fact that the required improvements to the CII are less ambitious than some would have wished could prove beneficial given the uncertainty about how to implement the requirement in the real commercial world of shipping,” he said.
Maria Skipper Schwenn, Managing Director of Danish Shipping, agreed that it would be better to keep events undecided between 2027 and 2030.
“With the goal of a CO2-neutral fleet by 2050, we had of course hoped for a more robust result,” she said. “However, these incredibly technical and politically sensitive negotiations took place under the most difficult of circumstances that one can imagine.”
The IMO’s MEPC meeting takes place about a month before officials in the European Union are expected to set the rules for admitting shipping to the EU emissions trading scheme from 2022.
The agreement on CO2 intensity measures also came at the urging of the US and EU delegations, who were aiming for more ambitious targets.
Richard Fulford-Smith, managing partner and founder of the ship broker Affinity (Shipping), said: âThe newly agreed reduction in CO2 intensity by 2% per year will only add to the disappointment in the US and the EU. This new intensity target would mean that absolute emissions from shipping will continue to rise over the next decade. “
Khalid Hashim, CEO of bulk carrier Precious Shipping, said the IMO’s latest move, while weak, is better than no move at all.
He pointed out that in the past, unilateral measures by countries, such as the US ballast water rules, have led the world to adopt stricter criteria.
“That’s what I meant when I said this is a time when the IMO deserves to be pushed and / or stimulated to ‘make a real difference’,” he said.
Hashim said introducing market-based mechanisms that could raise the cost of heavy fuel oil to ammonia levels, for example, would make a real difference.
John Bassadone, CEO of marine fuel company Peninsula, said it was always good to have strong goals in place to make sure companies aren’t complacent.
He referred to the IMO 2020 sulfur cap as evidence that the maritime sector can handle it, even if some expressed disaster fears before implementation.
“Yes, there were certain challenges, but it was delivered,” he said.