Global carbon price on international shipping remains on the table, following negotiations at the 84th session of the Marine Environment Protection Committee (MEPC84) at the International Maritime Organization (IMO) in London this week.
The Net-Zero Framework (NZF), a landmark climate regulation introducing the world’s first carbon pricing on any international sector, will be further discussed at an additional round of negotiations later this year.
At MEPC84 this week:
A majority of countries (55) who spoke at the meeting supported the NZF, emphasising the need for its carbon pricing/funding mechanism. These countries included: Brazil, the EU, the UK, Australia, Canada, Mexico, Colombia, Kenya, Namibia, South Africa, Mauritius, Switzerland, Republic of Marshall Islands, Tuvalu, Vanuatu, Tonga, Nauru, Solomon Islands, Fiji, Dominica, Belize and others.
51 countries favoured proposals to re-open the framework for substantial changes, including removing the carbon pricing element and/or weakening agreed limits on carbon intensity in fuels which would prolong the use of fossil fuels. These countries included: the US, Saudi Arabia, UAE, Argentina, Liberia, Venezuela, Qatar, Malaysia and others.
On Friday, the discussion focused on the Terms of Reference for further negotiations. Countries agreed to move forward with the NZF as the only named, agreed framework in the text, but kept the door open to considering any existing or future proposals. Across the board, delegations throughout the week showed a clear willingness to continue the dialogue.
Why this matters: Having more countries speak up to defend the IMO NZF from the attacks of the current US administration and other oil-producing states was an important boost to global climate diplomacy and multilateralism, said some delegates. This is particularly relevant as UN shipping talks took place at the same time as the Colombian conference on phasing out fossil fuels, signalling that countries are prepared to “walk the talk” at IMO. The US, Saudi Arabia, Russia and other mostly oil-producing states failed to achieve again their stated objective of weakening the agreement, despite exerting diplomatic pressure on countries during the negotiations.
Next steps: The NZF will serve as a basis for further discussions this autumn, together with all existing or new proposals for the way forward. These other proposals right now include a Fiji proposal for a global carbon levy if the Framework is re-opened, Japan proposal to remove the carbon pricing element, and Panama/Liberia proposal to remove the carbon price while also weakening agreed limits on carbon intensity in fuels to prolong the use of fossil fuels. The IMO has until late 2026 to discuss adoption again.
Experts say the NZF is key to help get ships off volatile fossil fuels faster, cut shipping fuel costs long-term, and move the industry closer towards achieving the climate targets countries unanimously committed to. The negotiations come at a time when global shipping has seen (fossil) bunker fuel prices doubling due to the war in the Middle East, adding private sector urgency to efforts to boost efficiency and move to alternatives.
Aseri Driu, Director of Transport, Ministry of Commerce, Trade, Tourism and Transport, Suva, Fiji, said: “Fiji, together with other Pacific states, came to London with a clear mandate to support adoption of the Net Zero Framework this year. As a small island developing state already experiencing the impacts of climate change, we have listened carefully to the concerns raised by other countries over the past two weeks. With the Framework now moving forward as the base text for a further meeting, Fiji remains confident that the NZF can be adopted this year as it is, in order to support a just and equitable energy transition for all.”
Delaine McCullough, President, Clean Shipping Coalition, said: “Most IMO member states have demonstrated support for the Net-Zero Framework, with many calling for its urgent adoption. Clearly, the NZF must be adopted as soon as possible, without interference from those who would seek to undermine or slow the process. Any further delay to the NZF is unacceptable – it already represents years of negotiation and consensus – the IMO has no other option capable of meeting goals of its own GHG Strategy or attracting wider support.”
Jamie Yates, Climate and Renewable Energy Manager, Pacific Environment, said: “The Net-Zero Framework remains on the table in full and as a single package. That was our litmus test for the week and we applaud the countries that ensured its survival. The NZF is still the most developed framework to deliver a just and equitable energy transition for shipping and thus we will continue to push for its adoption in full as soon as possible, alongside the growing number of countries from the Global South, SIDS, and LDCs who continue to advocate for climate action. The alternatives on the table do not represent compromise; they lock in winners, disregard the growing costs of inaction, and leave the most vulnerable countries to absorb the consequences of instability and fuel price volatility on their own. We cannot entertain their false promises, but we can continue constructive discussion on the Net-Zero Framework to best achieve an ambitious climate outcome for shipping.”
Em Fenton (they/them), Senior Director of Climate Diplomacy, Opportunity Green said: “The Framework has survived, but survival is not a victory and we cannot end up in a cycle of open-ended negotiations. Taking forward consideration of multiple proposals is only acceptable as a bridge, not a destination. We must now look forward to moving towards adoption of the Framework later this year in a way that maintains urgency and ambition, and delivers justice and equity for countries on the frontlines of climate impacts.”
Manuel Pulgar-Vidal, WWF Global Climate and Energy Lead, COP20 President and IUCN Climate Action Commission Chair, said: “The Net Zero Framework – set to make emissions cuts compulsory for global shipping – is on track for adoption this year. We cannot let this moment slip away. If the world is serious about keeping 1.5°C within reach, every major sector must pull its weight, and shipping can lead the way. Governments now have a clear mission: seize the momentum, lock in an ambitious, workable package, and get it adopted later this year. The signal to markets must be unmistakable – cleaner ships, cleaner fuels and real emission cuts starting this decade.”
Christiaan De Beukelaer, Senior Lecturer in Culture & Climate, University of Melbourne, said: “The NZF is a ship that took years of collective effort to design and construct. Now it is mostly built, even if more work needs doing before it launches. The last two weeks saw real willingness from a majority of countries to get it finished. Even so, while most are working hard to set sail together, some are trying all they can to scuttle the ship they agreed to build back in 2023.”
Joe Williams, CEO, Green Hydrogen Organization, said: “A majority of governments held the line on the IMO Net-Zero Framework this week. In the face of scaremongering and misinformation from certain petrostates, a coalition across Africa, Europe, Latin America and the Pacific defended the NZF as the way forward to achieve the IMO’s goals for global shipping’s energy transition. A shift to electrofuels based on renewables is all the more important given the conflict in the Middle East which has laid bare the massive cost of our reliance on fossil fuels.”
Madadh MacLaine, Secretary General, ZESTAs, said: “The Net-Zero Framework is still on the table, and that matters. A decade of negotiation, trillions of dollars of investment decisions, and the economic future of an industry that moves nearly seven trillion dollars of goods every year — all of it depends on IMO delivering regulatory certainty. The majority of member states and the industry know this. We also know the cost of getting this right is a fraction of a percent of the value this industry generates every year. Hydrogen is ready. The technology is ready. The only thing that can slow this down now is a failure of political will — and we have not seen that failure this week.”
Alisa Kreynes, Director of Ports and Shipping, C40, said: “This development, while not entirely decisive, is a hard-won victory for multilateralism and the IMO. It is also a signal to the global shipping market that measures such as a carbon tax, remain a crucial element to delivering a just transition – this is the regulatory baseline that subnational governments and the industry have long called for. Today’s outcome reaffirms early-mover strategies like Green Shipping Corridors, helping scale technical pilots into global practices. While this framework puts the industry on the right path, the real work of implementation – building the bunkering infrastructure, de-risking fuels, enabling partnerships across the value chain, and a Net Zero Fund which supports the transition in the Global South – is subject to further backing later this year.”
Stela Herschmann, Deputy Head of International Policy, Observatório do Clima, Brazil, said: “No single country is capable of overcoming its dependence on fossil fuels on its own. Santa Marta has marked the beginning of a process that can achieve many things, including the formation of a coalition of forces for all the necessary forums where we can move forward to dismantle the countless barriers to the transition, including in the UN Climate Convention, UN Tax Convention, the International Maritime Organization and Multilateral Banks.”
Source: Clean Shipping Coalition
