This week, U.N. Secretary General António Guterres called the latest findings of the United Nations’ climate report “a code red for humanity.” Maritime shipping is a major source of greenhouse gas emissions. Ships carry up to 90 percent of world trade, and shipping is the most fuel-efficient means of global transportation. Even so, each year, the sector produces carbon dioxide and other greenhouse gases totaling 1,056 million tons — a figure that rivals the annual emissions of Germany, the world’s sixth-largest emitter.
If nations wish to implement the 2015 Paris climate agreement and limit global warming, reducing shipping’s greenhouse gas emissions is crucial. Yet the International Maritime Organization (IMO), the U.N. agency responsible for regulating shipping, is widely seen as not doing enough to address the problem.
My research looks at why the IMO has failed to address climate change — and at the wider implications of its inaction.
What is the IMO?
The IMO, which was established in 1959 as a U.N. agency and headquartered in London, facilitates technical cooperation and standard-setting for marine transportation. Its Marine Environment Protection Committee handles climate change and has the power to adopt and amend legislation governing marine pollution from ships, including greenhouse gas emissions and energy-efficiency regulations.
Although it is a U.N. agency, the IMO is dominated by industry associations and countries with a strong interest in shipping — countries that generally oppose climate change regulations. This includes countries that offer what are known as flags of convenience such as Panama and Liberia, major ship-owning countries such as Greece and Japan, and poor and middle-income countries such as Russia, China and Brazil, which worry that tighter environmental regulations will increase prices for raw materials and basic consumer goods.
These countries cooperate closely with major shipping associations to shape climate change regulation at the IMO, as a recent New York Times investigation has shown. Shipping associations not only participate in IMO working groups as observers, but they also have representatives in national delegations — and often represent smaller nations and countries offering flags of convenience.
The IMO and climate regulation
The 2015 Paris agreement excluded shipping, because it is an international activity not easily addressed through national commitments alone. Instead, nations delegated climate-related regulation of shipping to the IMO.
And here’s where the dominance of shipping interests comes in. The IMO’s 2018 strategy on climate change does not include specific targets for achieving carbon neutrality, for example, let alone imposing binding regulations to meet such targets. At its meeting in June, the IMO failed to adopt effective short-term measures to increase vessels’ energy efficiency or reduce greenhouse gas emissions from shipping over the next few years.
Some countries are pushing harder for climate regulation at the IMO. The European Union and small Pacific island nations are leading those efforts to get the IMO to adopt more effective decarbonatization measures. Among the Pacific nations pushing for regulations is the Marshall Islands, which is, ironically, also a major provider of flags of convenience. The E.U. is pushing to reduce emissions from shipping to help it achieve its goal of net-zero carbon emissions by 2050. Small Pacific island nations see climate change and rising sea levels as existential threats. The Clean Shipping Coalition and other civil society groups also lobby for more effective climate change regulations for shipping.
Under President Biden, the United States is supporting the pro-regulation camp. Special Envoy for Climate John F. Kerry promised to “work with countries in the IMO to adopt the goal of achieving zero emissions from international shipping by 2050.” However, other nations realize that U.S. policy may not remain consistent; the Trump administration, for instance, did not consider climate change a priority.
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So what can be done to decarbonize shipping?
The IMO and other international forums and organizations are discussing three policy options for reducing shipping emissions.
First, the IMO’s business-as-usual approach would tighten climate regulations over the years but keep them below a level that would force ship owners to reduce emissions. The IMO’s short-term energy-efficiency measures, for instance, not only contain many loopholes — such as allowing noncompliant ships to continue operating for three years — but they also offer no enforcement and compliance mechanisms such as revoking operating licenses for violations. This approach is supported by major shipping nations, including Japan and Panama, and by industry associations.
Second, the Marshall Islands is spearheading a push for a global carbon tax of $100 to $300 per ton on all greenhouse gas emissions from shipping. The goal would be twofold: First, encourage development of alternative energy sources such as hydrogen; and second, help fund climate change adaptation in vulnerable countries. But European governments view the $300 price as too high, while most shipping nations and industry associations reject a carbon tax completely. In response, shipping associations have proposed a small fee of $2 per ton on shipping fuel to support research and development efforts for alternatives.
Third, the E.U. is developing plans to decarbonize the maritime industry without working through the IMO. The E.U. wants to include shipping in its Emission Trading System beginning in 2023, and it also seeks to introduce goal-based fuel “GHG intensity” targets to reduce ships’ greenhouse gas intensity in the next few years. Noncompliant ships and companies could be banned from E.U. ports.
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The threat of the third option might actually have an effect. The shipping industry is increasingly worried that the E.U.’s move will be part of an emerging patchwork of regional decarbonization regimes. That would not only complicate global shipping operations but would also weaken the IMO and undermine the industry’s influence over global maritime regulations. Denmark-based Maersk, one of the world’s biggest shipping companies, has therefore proposed a $50 to $150-a-ton carbon tax to stave off possible regulatory pressure.
But the maritime industry’s continuing strong influence might lead the IMO to continue its minimalist approach. The conflict over maritime climate change regulations will continue — at the IMO and elsewhere.
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Jan Stockbruegger is a Dean’s Faculty Fellow at Brown University’s Department of Political Science and an affiliate at the Climate Solution Lab at the Watson Institute for International and Public Affairs.