On April 11, the Marine Environment Protection Committee (MEPC) of the International Maritime Organization (IMO) agreed on a set of mid-term measures aimed at achieving net-zero emissions in global shipping by 2050. This decision follows earlier short-term measures focused on enhancing fuel efficiency. The proposed package is expected to be adopted by October 2025, with additional guidelines scheduled for approval in spring 2026.
Once finalized, it will be integrated into the MARPOL treaty, coming into effect in 2027. Key components of the net-zero strategy include a carbon pricing mechanism for emissions exceeding set targets. The framework establishes a price of $380 per tonne of CO2 equivalent for those emissions that do not meet an 8% reduction target by 2030, ramping up to a 30% reduction by 2035 compared to 2008 levels.
A $100 charge will apply to emissions that fall below the baseline but are not overly excessive. This pricing structure may result in shipping companies facing costs up to $1,200 per tonne of bunker fuel, which is four times the current prices. Despite the progress, the framework does not implement a comprehensive pricing mechanism for all shipping emissions, unlike the European Union’s emissions trading system (ETS).
Many industry leaders have argued that a full carbon pricing approach would significantly incentivize decarbonization while generating funds to support green initiatives. Moreover, the policy takes a “fuel agnostic” approach, focusing on greenhouse gas intensity rather than excluding certain fuels. While this could facilitate the use of biofuels, it raises concerns about over-reliance on first-generation feedstocks without clear sustainability requirements.
Additionally, the new emission reduction targets are less ambitious than previous goals, calling for only an 8%-21% reduction by 2030 instead of the earlier 20%-30% target. Overall, while the framework marks an important step toward decarbonizing shipping, it highlights the need for further advancements to reach the necessary environmental goals.