Governments across the globe have agreed to give further consideration to the concept of an International Maritime Organisation (IMO)-supervised, industry financed, $5-billion fund, to be governed by an autonomous board, to accelerate the introduction of zero-emission technologies for maritime transport.

The proposal — backed by eight of the global shipping industry’s top associations — seeks to impose a mandatory levy of $2 per tonne of fuel consumed by ships to fund R&D projects by raising an estimated $500 million annually and $5 billion over 10 years.

Questions linger

The fund would be administered by an autonomous organisation, to be called the International Maritime Research and Development Board (IMRB). The eight groups are seeking to make the IMRB running by 2023. The first-ever discussion on the proposal at the IMO, the United Nations’ agency tasked with regulating shipping, was held during its Marine Environment Protection Committee (MEPC) meeting last week. Governments, while broadly welcoming the proposal, also raised a number of legitimate issues for the IMO to address.

“India has not opposed the proposal but raised concerns on several areas which need detailed deliberations,” a government official said.

Questions on the governance of the R&D Fund and IMO oversight and the need to take account of the economic impact on states of the proposed mandatory levy and to address the interests of Least Developed Countries (LDCs) and Small Island Developing States (SIDS) were raised.

Every advancement in technological certainty increases investment certainty, reducing the future cost of the transition to zero-carbon fuels and technologies, and accelerating the pace at which that transition can occur, says the International Chamber of Shipping, the global trade body for shipowners and operators, and one of the eight groups to moot the R&D Fund.

“With the $5 billion in core funding over a 10-year period, generated from industry contributions, the IMRB will create the technological and investment certainty to spur innovators, engineers, energy companies, shipyards, financial institutions, and engine manufacturers to accelerate the R&D effort required to decarbonise shipping,” the ICS said in a statement.

Greenhouse gases

The IMO’s greenhouse gas (GHG) strategy, adopted in 2018, sets ambitious targets to halve GHG emissions from ships by 2050, compared to 2008, and reduce carbon intensity of international shipping by 40 per cent by 2030.

The IMO’s MEPC meeting also approved draft new mandatory regulations to cut the carbon intensity of existing ships.

The draft amendments proposed would require ships to combine a technical and an operational approach to reduce their carbon intensity, the IMO said after the meeting.

“The IMO 2050 climate targets can only be achieved with the immediate acceleration of zero-carbon fuels and technologies. The IMRB is a crucial vehicle for driving the progress needed to build a zero-carbon shipping industry, and the necessary funding can only be provided within the global regulatory framework of IMO,” the ICS added.

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