The International Maritime Organisation’s 22nd Intersessional Working Group on Reduction of GHG Emissions from Ships (ISWG-GHG 22) closed in London on September 4 with negotiators signalling renewed momentum towards a final agreement on the organisation’s Net-Zero Framework (NZF), even as fundamental differences persist over carbon pricing, revenue distribution and support for developing states.
The four-day meeting did not finalise any legal text. Instead, delegates continued discussions on proposals intended to address concerns surrounding the draft amendments to MARPOL Annex VI that would underpin the IMO’s mid-term decarbonisation measures. According to the official IMO meeting summary, participants considered proposals on the NZF, held only a preliminary discussion on implementation guidelines due to time constraints, and deferred both guideline development and further work on the Life Cycle Assessment (LCA) framework to ISWG-GHG 23 in November.
Nevertheless, the session produced what many observers regard as an important political signal.
According to an IMO press release, the chair, Sveinung Oftedal of Norway, noted a “genuine willingness” among delegations to make further progress and work towards presenting text to Marine Environment Protection Committee 85 that addresses the remaining concerns raised about the draft amendments.
An analysis produced by UCL Energy Institute suggests that support for the architecture agreed in principle at MEPC 83 remains resilient despite numerous alternative proposals. The analysis concludes that “NZF ‘as is’ still remains the obvious answer (and most supported way forwards), but the process to realised that conclusion formally makes this a difficult political solution.”
Carbon pricing remains at the center
The dominant issue throughout the meeting was the future of the economic element of the Net-Zero Framework, specifically the proposed greenhouse-gas pricing mechanism and accompanying revenue-distribution structure.
The official IMO summary confirmed that discussions focused heavily on proposals intended to resolve remaining concerns over the draft framework.
According to the UCL analysis, support for a fund, facility or comparable structure remained considerably stronger than opposition. The report states that the debate divided delegates into two camps: “Those in favour of a fund/facility/structure” and those advocating a technical-only redesign that would eliminate a central financial mechanism.
UCL noted that 38 member states that intervened supported some form of revenue-collection and distribution mechanism, compared with 17 opposing it.
The report argues that “substantial, resilient support remains for establishing a centralised structure for receiving/managing revenues” and that most delegations continue to view an economic measure as essential for delivering the IMO’s 2023 GHG Strategy.
Five alternative frameworks were discussed during the session, including proposals from Brazil, Liberia, Japan, the UAE and Fiji. Yet the UCL analysis suggests that several of these alternatives were presented more as discussion documents than as genuine replacements for the existing NZF proposal.
Particular attention focused on Japan’s proposal to replace greenhouse-gas pricing with a system of direct contributions to approved projects. That concept received little support from many of the countries whose backing would be required to build consensus.
The report concludes that the proposal represented the only genuinely new idea capable of significantly altering the framework’s architecture, yet “once again, it failed”.
Softening of GFI
One area where compromise appears increasingly likely concerns the Global Fuel Intensity (GFI) reduction pathway.
Several delegations, including Brazil and Japan, proposed easing the framework’s initial stringency during the early years of implementation. While support remains for retaining ambitious long-term goals, many countries appeared open to a softer trajectory during the 2029-2035 period, provided this is offset by steeper reductions later
The UCL report concludes that “GFI is likely to be softened initially (around 2030), but then steeper in the period to 2040.”
Importantly, a majority of states also continued to support maintaining a defined 2040 target within the framework. Industry observers argued that retaining the target is crucial for maintaining investment certainty in fuels, vessels and supporting infrastructure. The chair acknowledged that any final compromise would need to “provide predictability for a needed time horizon”.
Despite efforts by some delegations to simplify the framework, support persists for mechanisms that actively encourage uptake of zero- and near-zero emission fuels.
The UCL analysis found that a large majority of countries continue to back dedicated reward mechanisms for ZNZ fuels. The report notes that support for incentives remains “a priority to many member states,” while proposals involving multipliers linked to surplus-unit values have attracted growing interest.
This suggests that policymakers remain determined to go beyond simple compliance measures and actively shape fuel markets during the transition to net zero.
But while ISWG-GHG 22 reinforced political support for the broad direction of travel, many technical questions remain unresolved.
The IMO confirmed that guideline discussions and consideration of the Life Cycle Assessment framework were largely postponed because of time limitations. Both topics will return at ISWG-GHG 23, scheduled for 23-27 November 2026.
The UCL team argues that the next meeting will be decisive. Although disagreements remain, the report highlights what it describes as a continuing commitment among delegates to reach a conclusion before the end of the year. It notes that “the spirit of cooperation was good,” and that the chair indicated confidence the group could deliver a conclusion to its work at MEPC 85.
But, as UCL’s authors conclude, “the devil is still in the detail”.
Source: IMO, Baltic Exchange
