Shipping industry must take ‘urgent action’ to meet Paris climate goals

§ Strategy

The IMO has struggled to make progress on tackling its emissions since it was first mandated by the international MARPOL convention to clean up the sector in 1997. The IMO’s last greenhouse gas study, published in 2014, showed that emissions are likely to grow significantly as global demand for trade continues to rise.

International shipping was not included in the final text of the Paris Agreement, but Hughes tells Carbon Brief the IMO and its member states recognise that it has to make efforts to contribute to the Paris goals.

The IMO has promised to lay out its “initial” climate strategy in April 2018, with a final revised version set to come out in 2023. Earlier this year, delegations from around the world met at the IMO headquarters in London and agreed a seven-point plan for a draft of the strategy.

A set of seven strategic directions for 2018-2023, adopted earlier this week by the IMO Assembly, also included one on developing solutions to minimise shipping’s contribution to climate change.

Carbon Brief asked Hughes about what kind of strategy the IMO is developing for decarbonising shipping. He said:

“We’re a regulator…so we develop mandatory rules that ships have to comply with, and we’ve done that for technical and operational aspects of shipping. The strategy that’s being developed now…is really looking at what further measures can be undertaken.

“Now the initial strategy, it’s a good question what will be in it, but there was agreement last July that there should be a sort of outline, a draft outline structure. That would include, importantly, obviously, sort of preamble introduction context, but very importantly, a vision of what the sector and where the sector should be going this century, essentially, in terms of its carbon emissions.”

Hughes said there is a suite of measures being considered, including both mandatory measures (see below) and voluntary measures, such as the need for more research and development on innovative technologies, and low-carbon alternative fuels.

§ Concrete target?

When asked whether the new strategy will have any concrete emissions reduction targets, Hughes said that is still part of the discussion. He said:

“The negotiation is looking at the various options that could be used to provide a target…If we have, for example – and thinking hypothetically – a vision that says ‘we need to remove, reduce all CO2 emissions from international shipping within this century’, or ‘by the end of the century’ or ‘in the second half of the century’, or whatever words you want to use…well, then you need to have an ambition that matches that target. That ambition then has to set goals and objectives, or, as has been referred to me, aspirational objectives.

“But when we look at setting targets for international shipping, whatever we do, there has to be a recognition also that currently…what [shipping] uses as its fuel: hydrocarbon fuel, liquid hydrocarbon fuel mainly. We use over 300m tonnes a year of bunker fuels…and we have to somehow replace those bunker fuels with some other [sustainable fuel or innovative technology].”

§ 1.5C

Today’s Tony de Brum declaration reiterates a commitment to the Paris Agreement’s goal of both holding global temperature rise to “well below” 2C and “pursuing efforts” to limit warming since the pre-industrial era to 1.5C.

Its signatories “confirm that international shipping, like all other sectors of human activity, must take urgent action in consideration of these vital objectives”.

Speaking to Carbon Brief about the 1.5C goal last month, Hughes said that while the IMO has received proposals from some countries that it should align itself with the Paris Agreement’s 1.5C goal, not all governments necessarily agree with this. He said:

“We work by consensus in the IMO and we seek agreement across with all governments, because that helps us move forward, particularly with this initial stage of the strategy, it’s important that everyone feels that we’re starting on the right place.

“In terms of the goal, 1.5C is ambitious for everybody, frankly, at this stage now. We recognise that, but also we recognise that those countries who are most at risk from climate change really need to see action. And, in fact, the [IMO working group on greenhouse gas emissions] that met just a couple of weeks ago [in October] recognised that, to a degree: […] it supported the need for early action. So it’s how you do it now, and again what is appropriate for the shipping sector.”

§ Corporate influence

In October, the NGO InfluenceMap published a report accusing the shipping industry of aggressively lobbying the IMO to obstruct climate change action for shipping.

This lobbying has ensured shipping remains the only sector in the world not currently subject to any emission reduction measures, InfluenceMap said.

The report singled out three industry trade associations – International Chamber of Shipping (ICS), the Baltic and International Maritime Council (BIMCO) and the World Shipping Council  – as having collectively lobbied to delay implementation of any climate regulations.

InfluenceMap also found that 31% of nations were represented in part by direct business interests at the most recent IMO environmental committee meeting. The report said:

“The IMO appears the only UN agency to allow such extensive corporate representation in the policy making process.”

All three trade bodies have denied they are obstructing climate action. WSC says it has offered concrete proposals for both short- and long-term carbon reduction and co-sponsored a proposal to reduce CO2 emissions, although this did not include binding sector-wide greenhouse gas emissions reduction targets. Similarly, ICS’s director of policy and external relations, Simon Bennett, says the shipping industry, in fact, played a large part in persuading IMO member states to develop a strategy to reduce emissions following the adoption of the Paris Agreement.

Carbon Brief asked Hughes to respond to concerns that business interests are overly represented in the IMO. He said:

“Well, we have formally responded [to these claims]. We’ve made clear that the delegations is a matter for the governments who attends IMO… It’s not [the secretariat of IMO] who decides who attends. It’s up to the governments to decide. 

“We have about 70 observer organisations who attend IMO and they come from a range representing the industry, representing environmental NGOs, representing the seafarers, another important component of our work…

“It would be strange, frankly, if an international regulator, for a sector like shipping, didn’t have industry representation providing input. They have a lot of the technical understanding of the shipping sector: ships are highly technical machines…To say we’ll be able to operate as a good regulator without input from the industry, I’d be surprised.”

§ Non-discriminatory principle

In contrast to the United Nations Framework Convention on Climate Change (UNFCCC), which recognises the principle of “common but differentiated responsibilities” (often referred to as “CBDR”) and capabilities depending on different national circumstances, the IMO has a non-discriminatory guiding principle. This talks about “no more favourable treatment”, with every ship treated the same.

The IMO is still making efforts to reconcile those two principles, Hughes told Carbon Brief:

“It’s very important we do so because, obviously, the developing countries want to see whatever [emissions reduction strategy] the IMO develops…recognise the CBDR principle. But, at the same time, the way we regulate shipping, international shipping, is to say ‘well all ships are the same’. So, that’s one of the areas where we’re having to work quite hard to try and get a compromise…

“This is a very important principle we have, because if ships were treated differently based on their flag state, the country on which they’re registered, then you would undermine, frankly, the whole international regulatory regime. Because why would anybody go under a flag state where they were having greater regulations imposed on them than another flag state…

“That’s not like a power station or a cement factory, so it’s much harder to say ‘well we’re going to control you’. So, we have to get agreement that all ships will have to comply…Otherwise we could suffer from things like carbon leakage, which again we want to ensure that any measures, we don’t have those sorts of problems.”

§ Technical measures

The IMO has implemented some carbon cutting measures in recent years, said Hughes. The mandatory Energy Efficiency Design Index (EEDI), for instance, currently requires new ships to be 10% more energy efficient than they were in the baseline 2000-2009 period. This will be pushed up to 20% in 2020 and 30% in 2025.

However, this is just for new ships. With 40,000 to 45,000 ocean going ships currently in use and with 1,000-2,000 new ones built each year, it will take decades to change all those to newer, more energy efficient ships. “It is a problem, I’m not going to deny it, that is a challenge,” said Hughes.

The IMO has also developed the Ship Energy Efficiency Management Plan (SEEMP) which aims to make the existing fleet more energy efficient in the way it operates, such as making sure the ship is set up correctly in the water, keeping the hull clean and using different operational practises, such as weather routing, says Hughes.

An oil consumption monitoring programme is also set to be introduced next year. From 2019, ships over 5,000 tonnes will have to collect data on the fuel oil they consume and report on it through their flag state to the IMO. Data on things such as distance and time travelled will also be collected.

The IMO also has several programmes geared at building technical cooperation and capacity building.

But Hughes insisted the IMO recognises these measures can only go so far. “If we’re going to sort of go further we have to look at other measures, and that’s part of the discussion now,” he said.

The IMO has also begun to look at market-based measures again, which stalled in the years ahead of the Paris Agreement due to fears of the impact it would have on economies. Hughes said:

“We’ve restarted that discussion now. In fact, when you look at the draft strategy, we have short, medium and long-term measures being proposed in there. And, in the medium term, they’re referring to market-based measures again. So we are trying to move forward, but it needs everyone to work together and understand some of the issues. And the impacts on states have to be recognised.”

§ Hopeful?

Carbon Brief asked Hughes if he is hopeful that a greenhouse gas reduction agreement can be reached at the IMO and whether he thinks, ultimately, shipping will limit its emissions. He said:

“I am. Because I think, as we see with the Paris Agreement, people recognise we are on a pathway now for…decarbonisation of the global economy. And I think that’s recognised by the governments.”

“But if somehow people could satisfy the negative risks – and the negative risks can be properly mitigated – then I think we can move forward…You know we have an expression, throw the baby out with the bathwater: international shipping is an important sector for global trade. I mean that’s fundamentally what we’re there for; we support global trade. And now 60% of global trade is done by developing countries, those countries have to be confident that there’s not going to be an impediment to their sustainable development.”

“Some companies are very keen on improving their carbon footprint…Fuel is over 50% of the operating cost of a ship. So companies who can see a reduction in fuel costs through, for example, energy efficiency measures, can improve their profit.”