Unprecedented Global Agreement Gives Shipping Clarity on Critical Next Step to Decarbonization

April 11, 2025

Print This Article Share it With Friends

(World Shipping Council) The World Shipping Council has welcomed an unprecedented global agreement at the International Maritime Organization (IMO) today, as a critical next step toward shipping decarbonization.

Following a contentious and difficult debate, the IMO reached agreement on a measure to be finalized 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.

“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,” World Shipping Council President & CEO Joe Kramek said today.

“Liner shipping has already moved to kick-start decarbonization, 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 decarbonization targets,” Joe Kramek concluded.

WSC’s Vice-President and lead IMO representative Bryan Wood-Thomas commended the ability of IMO to reach agreement on one of the most challenging issues in the history of the Organization.

“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,” Bryan Wood-Thomas said.

“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,” Bryan Wood-Thomas concluded.

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 GHG emissions
Alternatives to traditional Very Low Sulfur Fuel Oil 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. READ MORE

Related articles

Atlantic Shipping emissions cut agreed, but IMO scrubber ban delayed (American Journal of Transportation)
IMO Climate Agreement shipwreck misses targets and betrays most vulnerable (American Journal of Transportation)

Excerpt from American Journal of Transportation: As a meeting of the International Maritime Organization’s (IMO) Marine Environment Protection Committee (MEPC 83) closes today, the Clean Arctic Alliance welcomes member states’ approval of a proposal for a new North-East Atlantic emission control area, scheduled to enter into force in 2027, which will lower emissions from ship operating in the region, including in the Arctic. Emission Control Areas (ECAs) are designed to reduce atmospheric pollutants from ships by requiring more stringent controls on fuels and engines.

Disappointingly, likely MEPC 83 outcomes related to reducing GHG emissions from shipping could have devastating consequences for the world's most vulnerable communities, for the Arctic, and the planet. Early indications are that agreements on measures to reduce greenhouse gas emissions, including a carbon intensity indicator, will lead to business as usual, and lack ambition to support a just and equitable transition.

The Alliance is also disappointed that during MEPC 83, which focussed on addressing climate heating emissions from the shipping sector, IMO member states have imposed a further delay on regulatory measures to address the use of scrubbers in the Arctic. While the delay is frustrating, the Alliance recognises that the proposal for a resolution calling on shipping operators to avoid using scrubbers in marine protected areas, habitats important for endangered wildlife, and other ecologically sensitive areas such as the Arctic, will instead be considered during next year’s PPR13.

“Coming just days after the record lowest maximum Arctic sea ice extent maximum in the 47-year satellite record, creation of the North-East Atlantic emission control area will significantly reduce ships’ emissions, improve air quality, and contribute to improving public health and environmental protection in the north-east Atlantic region, including the Arctic waters around Greenland and Iceland”, said Dr Sian Prior, Lead Advisor to the Clean Arctic Alliance.

“By restricting the use of the most polluting shipping fuels, this emission control area would see SOx emissions cut by up to 82% and particulate matter by 64%, which will avoid thousands of premature deaths by 2050, and have a co-benefit of reducing the black carbon emissions which have a detrimental impact on Arctic snow and ice”, said Lola Berna, Project Manager at ECODES.

“We welcome Iceland stepping up its engagement for the conservation of the North-East Atlantic”, said Árni Finnsson, Board Chair at the Iceland Nature Conservation Association. “We trust the Icelandic government will take further action immediately to ban heavy fuel oil in the Arctic, and banning black carbon emissions from ships within its 12-mile territorial waters.”

“We welcome how the international community represented at the IMO came together to create the North-East Atlantic Emission Control Area, which will reduce emissions from shipping in the Arctic to the benefit of the health of local populations and wildlife, including Greenland, which has a fragile and unique ecosystem”, said Kåre Press-Kristensen, Senior Advisor to Green Global Future. “However, this should only be seen as the first step since much more action is required if our children and grandchildren are to experience and benefit from the fantastic culture and nature of the Arctic”.

“While the development of the concept of polar fuels - fuels which are suitable for Arctic use because they cause lower black carbon emissions - was not directly on the agenda at MEPC 83, the approval of both the creation of a Northeast Atlantic emission control was critical. With delays to the scrubber ban, IMO member states must set the stage for development of a concrete proposal for next year’s PPR 13 that will reduce black carbon emissions from ships operating in and near the Arctic”, added Prior.

Black carbon is “shipping’s second largest cause of global warming” after carbon dioxide and makes up around one-fifth of international shipping’s already considerable climate impact. Black carbon is a solid particulate matter - soot - ejected by ship engines into their stacks and then into the atmosphere. This soot is a short-lived climate pollutant produced by the incomplete burning of fossil fuels in the engine combustion chambers, and has a climate warming impact more than three thousand times that of CO2 over a 20 year period.

Black carbon is widely recognised to be a “super pollutant” because of the outsize impact it has on both human health and on the climate. In its recent 6th Assessment Report, the UN Intergovernmental Panel on Climate Change (IPCC) doubled the estimate of the warming potential of black carbon on snow and ice due to a better understanding of its impact. Black carbon, along with other super pollutants - methane and ozone, are responsible for nearly half of global temperature increases to date and reducing emissions of ‘super pollutants’ would slam emergency brake on global warming. In its latest report, the Clean Air Fund recommends cutting black carbon emissions from shipping as quickly as possible and recognises cuts in emissions can unlock near-immediate climate gains.

Black carbon has been on the IMO’s agenda for more than a decade, but it has yet to take meaningful action. Addressing the impact of black carbon on the Arctic is one of the longest, unresolved issues running at the IMO and must be dealt with without any further delay. The Clean Arctic Alliance is urging Member States to collaborate in the development of a concrete proposal, for consideration by PPR 13 in early 2026.

Scrubbers
Scrubbers, also known as exhaust gas cleaning systems, are an end-of-pipe equipment compliance mechanism employed on ships to remove harmful pollutants and particulate matter from exhaust emissions. However, the pollutants are then invariably dumped into the ocean, transferring the problem from the atmosphere to the marine environment.

During MEPC 83, governments did not adopt the the proposal from Clean Arctic Alliance members for a resolution to prohibit the use of scrubbers in protected areas and ecologically sensitive areas such as the Arctic, but forwarded it to the IMO’s Pollution Prevention and Response subcommittee (PPR 13, early 2026) for consideration.

“We knew that scrubbers cause marine pollution, but now a Canadian paper (MEPC 83/5/1) makes clear that air pollution is not solved by scrubbers, and calls into question their efficacy”, said Eelco Leemans, Clean Arctic Alliance Technical Advisor. “It’s therefore disappointing that during MEPC 83, despite widespread support, governments delayed consideration of a proposal calling for a resolution urging member states and ship operators to avoid using scrubbers in highly vulnerable areas such as the Arctic. At next February’s PPR 13 meeting, the IMO must evaluate the efficacy of scrubbers for reducing particulate matter emissions compared to low sulphur fuels. and commit to mandatory regulation of scrubbers.”

Climate and Biodiversity Nexus
"This week’s successful agreement of a new Emission Control Area (ECAs) in the North-East Atlantic is a good example of how solutions with co-benefits can contribute to tackling the triple planetary crisis of pollution, heating and biodiversity loss”, said Andrew Dumbrille, North American Advisor to theClean Arctic Alliance. “As well as reducing the impact of air pollutants on community health, ECAs reduce black carbon emissions responsible for ice and snow melt, and local and global heating, as well as safeguarding community food security. Taking a shipping nexus approach and considering the intersection of multiple threats and solutions will allow the marine sector to respond to the urgency of the global challenges we face.” READ MORE

Excerpt from American Journal of Transportation: “A properly functioning CII is essential for the shipping industry to reap the emission rewards of the lowest-hanging decarbonization fruit, and to keep the cost of shipping’s climate transition to a minimum. Without a change of heart at the next meeting (MEPC 84 in 2026), around half of shipping’s 1.5C aligned emissions will effectively remain unregulated.” (John Maggs, Clean Shipping Coalition)

...

Faïg Abbasov, shipping program director for Transport & Environment: “Without better incentives for sustainable e-fuels from green hydrogen, it is impossible to decarbonize this heavy polluting industry. The ball is now in the court of individual countries to implement national policies to open a life-line to green e-fuels"

“This week's outcome misses even IMO's baseline - leaving the 2030 decarbonisation target dead in the water, with potential disastrous long-term impacts for people and the planet. The EU may have drifted to the corner of low-ambition, but the absence of bold targets brought bold voices: the emergence of a strong, united voice from African, Caribbean and Pacific nations shows that the global south won't wait for the north to get their act together", said Anaïs Rios, Shipping Policy Officer, Seas At Risk.

“The compromise reached today by IMO member states is clearly not up to the challenge that awaits the shipping sector,” said Bastien Bonnet-Cantalloube, Expert on Decarbonization of Aviation and Shipping, at Carbon Market Watch. "Not enough emission reductions, not enough emissions priced, not priced high enough, not enough revenues. By ignoring the problem, the IMO will not make it go away. This marks a missed opportunity to set an example for other sectors to agree on ambitious global measures for their decarbonization. Governments in the IMO clearly have work left to set the course for a just and ambitious decarbonization pathway for international shipping. More ambitious regional and industry actions are needed to make up for this blatantly weak deal.”

“The IMO is not just failing on climate—it’s actively enabling a methane lock-in,” said Elissama Menezes, Director of Equal Routes. “This week’s meeting showed that even with the heavy lifting done by small island developing nations, and least developed nations, the IMO continues to protect the status quo. The refusal to adopt a 1.5°C-aligned carbon levy that supports the world’s most vulnerable has left the least developed behind. And while methane-based fuels like LNG face growing scrutiny worldwide, the IMO is effectively leaving it to others to regulate their climate impact. By refusing to take a clear stand on 1.5 alignment, the IMO is risking both climate credibility and its relevance in the global energy transition.”

On Thursday, April 10, consideration of proposals for enhancing the CII’s effectiveness were delayed by two to three years, while the new targets for 2027-30 were set at levels close to ‘business-as-usual’, so low that they will play no meaningful part in meeting the 2023 IMO GHG Strategy’s absolute emission reduction goal for 2030 - and pretty much guaranteeing that this target will now be missed.

The Global Fuel Standard (GFS) deal agreed today by IMO member states provides clear decarbonisation targets until 2035 and only a small share of emissions will be priced for revenue generation.

...

During MEPC 83, IMO member states replaced the flat high levy on all GHG emissions from ships, with a hybrid system of some credit trading and requirement for ships with emissions exceeding the target for the year to purchase remedial units at a set price.

...

The coalition also singled out the EU for criticism, for its failure to support an ambitious revision of the Carbon Intensity Indicator.

...

In 2023, the IMO adopted a strategy that set a clear ambition to reduce emissions from shipping by at least 20% by 2030, striving for 30%. READ MORE