Global shipping is under pressure to ease pollution after COP26

Global talks on how to clean up shipping are set to begin Monday as momentum builds to cut pollution from the sector.

The International Maritime Organization “is under pressure to do something,” said Edmund Hughes, who was previously responsible for greenhouse gas emissions at the United Nations body, which is shipping’s global regulator and the host of the upcoming virtual talks. “It’s going to be difficult if nothing of substance comes out of next week.”

Following the UN’s COP26 climate summit last weekend, the IMO’s chair is challenged with steering as many as 175 member states toward cleaner shipping. The sector, which transports more than 80% of the world’s internationally traded goods, has a carbon footprint bigger than Germany and the Netherlands combined.

Perhaps the most significant proposal on the table for next week comes from three Pacific Island nations, which are calling for the IMO to recognize that international shipping must reach zero greenhouse-gas emissions by 2050. If agreed, the resolution wouldn’t be a mandatory requirement, Hughes said. But it would send a clear message on the organization’s direction.

The IMO’s official target—due to be revised in 2023—is for only a 50% cut by 2050. That’s well short of what’s needed to align shipping with the 2015 Paris Agreement’s goals to limit global warming, according to the International Council on Clean Transportation, a non-profit. The head of the UN has also blasted the current level of ambition.

Momentum Building

Multiple countries have already said they want a price put on pollution from international shipping, and a major trade group wants the IMO to consider targeting net-zero carbon emissions by 2050. Nations have also pledged to establish clean sailing routes, and large companies have made promises on minimum clean fuel usage.

Talks on carbon pricing—which many see as a way to bridge the cost gap between today’s oil-derived marine fuels and cleaner alternatives—are also scheduled, although no major new rules are expected to be approved next week, according to two industry insiders. There’s a separate proposal for a fuel GHG intensity limit and emissions cap and trading package.

A longstanding call for a $2 a ton levy on fuel oil used by ships, to raise $5 billion for research and development, is on the agenda. The proposed pricing is too low—and not designed—to drive major behavioral change. But its underlying mechanism, which charges for carbon emissions, could form the basis of more heavy-handed pricing rules.

“Come out with the rules and we will comply,” Svein Steimler, chief executive officer of NYK Group Europe Ltd., said at an event held during COP26. “You politicians, you need to get your act together and tell us what to do.”