Guy Platten (ICS): “We have been frustrated by short-sighted political manoeuvring which has led to the proposal in effect being killed” (source: ICS )
A proposal to create a US$5Bn R&D fund to spur decarbonisation in international shipping has been rejected at IMO’s Marine Environment Protection Committee (MEPC 78) meeting in London
In a statement, International Chamber of Shipping (ICS) secretariat general Guy Platten blasted the rejection of the proposal as a standalone policy at MEPC78, held 6-10 June, as a “wasted opportunity.”
ICS, which represents some 80% of the global shipping fleet, has been backing the R&D fund, the IMO Maritime Research Fund (IMRF), to accelerate the uptake of zero-carbon technologies and fuels by shipping to meet decarbonisation targets by 2050. IMRF was jointly submitted to IMO by shipping industry trade associations in 2019. Intercargo, which represents dry cargo shipowners, had also called for the proposal’s approval.
“Despite the support of many IMO States, we have been frustrated by short-sighted political manoeuvring which has led to the proposal in effect being killed,” said Mr Platten. “The signal this sends means the financial risk associated with green investment will remain high, slowing down efforts to switch to zero-carbon fuels as soon as possible.”
The proposed IMRF would be funded through a fuel levy; for each tonne of fuel they burn, ships would have to pay US$2.
In order to sink it, Mr Platten said opponents purposely mischaracterised the proposal. “Some claimed the fund was a market-based measure and did not go far enough, deliberately misinterpreting our intention,” said Mr Platten. “The fund was never presented as a carbon pricing measure, which, although being an additional measure which we also fully support, is politically far more complex and will take many more years to develop. If governments had shown the political will, the separate R&D fund could have been up and running next year, raising billions of dollars from industry at no cost to governments.”
Despite the setback, Mr Platten said the shipping industry “remains committed to finding ways of achieving net-zero carbon emissions by 2050. Funding for R&D will be top of the agenda at the ‘Shaping the Future of Shipping Summit’, to be hosted by ICS in London 21 June. We will bring together leading CEOs from across our global industry to find ways to practically decarbonise shipping.”
ICS deputy secretary Simon Bennett took the ‘glass is half full’ view of the proposal’s demise. He pointed out there was still a possibility IMO might use the IMRF’s proposed regulatory architecture to underpin a future global carbon levy on shipping’s CO2 emissions that would “close the price gap” between traditional and new zero-carbon marine fuels to support the transition to net zero by 2050.
A policy creating such a fund could be taken up at a later date as part of a clutch of measures, but this would not happen before 2025.
“If the contribution system which we have developed can speed up implementation of a global carbon levy for shipping, we may yet be able to look back on this setback at the IMO as a significant moment of success,” said Mr Bennett.
