The World Shipping Council has welcomed an unprecedented global agreement at the International Maritime Organization (IMO) today, as a critical next step toward shipping decarbonisation.
Following a contentious and difficult debate, the IMO reached agreement on a measure expected to be finalised and adopted in October. The measure establishes a GHG fuel standard and framework that, if adopted, will require continuous reductions in GHG fuel intensity beginning in 2028 with ongoing reductions over the next two decades. IMO is poised to move forward on a topic that has evaded legally binding standards in many other fora for decades.
WSC President and CEO Joe Kramek said: “This is a major milestone for climate policy and a turning point for shipping. Our industry has long been labelled as ‘hard to abate,’ but record industry investment and a new global measure can turn the tide on that. Liner shipping has already moved to kick-start decarbonisation, with nearly 1000 renewable-capable ships set to be on the water by 2030. However, a global regulation is necessary to deliver the renewable fuels at a commercially viable price. Outcomes from the IMO today mean global regulations can now begin to leverage the record industry investment to meet decarbonisation targets.”
WSC VP and lead IMO representative Bryan Wood-Thomas added: “Building on the World Shipping Council’s Green Balance Mechanism, the agreement creates a two-tiered regulatory measure that applies emission fees proportional to the GHG intensity of the energy used by a ship. Most importantly, the regulations also provide a mechanism that encourages the use of cleaner zero and near-zero fuels and energy sources. The production of clean fuels and energy sources will create economic opportunities across the globe and have environmental benefits that will last for generations. However, there is considerable work remaining to ensure we have the rules and guidance necessary to use the fuels that will power the world’s fleet in future years. These regulations are a critical starting point that gives us the needed regulatory structure to address this critical issue that impacts every corner of the globe.”
WSC has outlined the following key facts:
- There are nearly 200 renewable-capable liner ships on the water today, and an additional 700 to be delivered by 2030.
- Shipping accounts for 2-3% of global GHG emissions.
- Alternatives to traditional VLSFO are significantly more costly: 31% more expensive for Liquid Natural Gas, (LNG), 53% for grey methanol, 111% for bio-LNG, and 274% for green ammonia according to Platts’ global bunker fuel cost calculator in January 2025 for Rotterdam.
