The World Shipping Council (WSC) today said it is continuing to develop a proposal that would support climate regulations for shipping by applying an extra fee on the cost of buying fossil fuels burned in container ships, and allocating those funds to support lower carbon-emission, green alternatives.
That “Green Balance Mechanism” would act as a regulatory measure to ensure that shipping meets its net-zero goal by 2050 in an efficient, just, and equitable way, according to the WSC, which is the primary trade association representing the ocean liner container shipping industry.
The WSC first proposed the idea in February, and has since collected responses and held conversations with member nations of the International Maritime Organization (IMO) and other stakeholders. Now the council has submitted a detailed proposal, including design updates and regulatory text, to support the timely development of the plan at the upcoming IMO ISWG-GHG 17 and MEPC 82 climate meetings.
"For shipping’s energy transition to take place, green maritime fuels must be available at scale, requiring billion-dollar investments by energy producers. For these investments to occur, the IMO must adopt regulations that not only increase fossil fuel prices but also make green fuels a viable alternative. Only then will there be a strong enough market for green maritime fuels to stimulate the necessary levels of investment in green fuel production and renewable energy," Joe Kramek, president & CEO of the WSC, said in a release.
According to the WSC, ocean carriers continue to invest in the decarbonization of their fleets. Over 60% of new container and vehicle carrier ships for delivery by 2030 will be ready to use the greenest fuels, but operators complain that these new fuels are scarce and several times more expensive than fossil fuels. The Green Balance Mechanism aims to bridge that price gap, making green fuels competitive with fossil fuels and ensuring demand that will drive investment in green energy and fuel production.
The council now says its enhanced proposal underscores the urgency of adopting robust IMO regulations by 2025 in order to achieve net-zero emissions by 2050. "IMO member states have a unique opportunity to decarbonize the world’s ocean supply chains. We do not have time for half measures,” Kramek said. “The IMO's regulations must make it possible for green fuels to compete with fossil fuels, to drive the transition effectively. Anything less risks raising transportation costs without achieving the climate progress the world needs.”
