Shipping industry backs US$5 billion decarbonization fund

by Inside Logistics Online Staff

Responding to the UN Secretary-General’s call for “urgency and ambition” on climate change, the global shipping industry is giving “full and unequivocal” backing to a moon-shot proposal to motivate the complete decarbonization of maritime transport within a decade.

The proposal, submitted by governments controlling a major share of the world’s shipping tonnage to the UN International Maritime Organization (IMO) is to establish a US$5 billion “IMO Maritime Research Fund” using mandatory contributions from the world’s shipping companies. The funds would be raised over the 10- to 15-year life of the program through a proposed mandatory contribution equivalent to US$2 per tonne of fuel oil consumed.

Board to commission research

This new fund would support a new International Maritime Research and Development Board (IMRB) to commission collaborative programs for applied research and development of zero-carbon technologies for maritime applications.

The shipping industry is urging all governments to approve the proposal – led by major shipping nations including Georgia, Greece, Japan, Liberia, Malta, Nigeria, Singapore, Switzerland – at an IMO meeting in London, UK, in November 2021. The proposal is also backed by the world’s major international shipowners’ associations: BIMCO, Cruise Lines International Association, IMCA, INTERCARGO, INTERFERRY, International Chamber of Shipping, INTERTANKO, IPTA and World Shipping Council.

“Decarbonization can only take place with a significant acceleration of R&D, as zero-carbon technologies do not yet exist that can be applied at scale to large ocean-going ships,” said a statement issued by BIMCO, CLIA, IMCA, INTERCARGO, INTERFERRY, International Chamber of Shipping INTERTANKO, IPTA and World Shipping Council.

“A well-funded R&D program, which the industry has agreed to pay for within a global regulatory framework, needs to commence immediately under the supervision of the UN IMO.”

International shipping transports more than 80 percent of global trade and emits two percent of global emissions.

“The big challenge is not building a single zero carbon ship, the big challenge is creating the technologies needed to decarbonize the entire global fleet at speed and scale. The sooner the IMO Maritime Research Fund is established, the sooner industry can develop zero emission ships to decarbonize maritime transport,” the statement concluded.