During the 83rd session of the Marine Environment Protection Committee (MEPC-83) of the International Maritime Organization

What does Green Shipping mean?

Green shipping denotes eco-friendly practices and technologies implemented in the maritime sector to lessen the environmental effects of shipping operations.

It encompasses reducing greenhouse gas (GHG) emissions, enhancing energy efficiency, and curbing marine pollution.

Requirement for Eco-Friendly Shipping

Global Emissions: The shipping sector produces approximately 1 billion tonnes of greenhouse gases each year, representing roughly 2.8% of total global emissions.

Future Predictions: Emissions could rise by 50–250% by 2050 if not controlled.

Actions Already Implemented:

Energy Efficiency Design Index (EEDI): Establishes efficiency criteria for new vessels.

Energy Efficiency Management Plan (SEEMP): Strategies for reducing emissions.

Required fuel oil usage reporting: Enhances responsibility and openness.

MEPC-83 Suggestions for emissions tax systems

The International Chamber of Shipping proposed a set fee for each tonne of CO₂ released.

China suggested a market-oriented strategy that would allow vessels to exchange compliance units and put money into alternative fuels.

The European Union proposed a set GHG tax, overseen by a fund administered by the IMO.

India suggested a 'bridging mechanism' that would focus solely on under-compliant vessels to shoulder the financial responsibility, while incentivizing those utilizing Zero or Near-Zero (ZNZ) fuels.

Singapore suggested a hybrid framework inspired by India's proposal, incorporating a GHG Fuel Standard (GFS) and a tiered system that incentivizes surplus emission units while mandating the acquisition of remedial units for shortfalls.

What was determined?

The IMO embraced Singapore's hybrid model, which was greatly shaped by India's proposal, as its Net Zero Framework.

This signifies the inaugural instance of a global sector implementing a compulsory emissions tax. Nonetheless, the resolution of the MEPC-83 is not definitive at this point.

Obstacles in execution

The decision made by MEPC-83, after endorsing the Net Zero Framework, requires amendments to Annex VI of the MARPOL convention, which regulates air pollution caused by ships.

The amendment will be circulated for a six-month period among all parties to MARPOL.

For final approval, it necessitates a two-thirds majority of votes from those members present and voting; this indicates that if all 101 parties take part, at least 67 must back the proposal.

No formal opposition should be raised by a third of the parties representing 50% of worldwide shipping tonnage.

What are the Issues?

• Countries that export oil, with Saudi Arabia at the forefront, resisted any substantial shift towards green fuels, focusing on safeguarding their fossil fuel markets.
• China and major shipping countries preferred low tariffs to sustain trade competitiveness.
• Scandinavian nations sought acknowledgment for their initial environmental initiatives.
• The initial principle of ‘Common But Differentiated Responsibilities and Respective Capabilities’ (CBDR-RC) is diminishing.
• Developed nations advocate for standard regulations, ignoring the historical emissions and economic capabilities of emerging countries.

Effect on India

Immediate Effect: By 2030, India's global fleet (approximately 135 vessels) will face increased fuel expenses of $108 million annually — a manageable amount considering the scale.

Opportunities for the Long Term:

India is making significant investments through the National Hydrogen Mission.

Indian ports are enhancing their capabilities for green hydrogen bunkering.

Indian hydrogen currently satisfies the IMO’s fuel reward criteria, enhancing its export opportunities.

Conclusion

The endorsement of a market-oriented emissions framework by MEPC-83 marks an important achievement in worldwide initiatives to reduce carbon emissions in the shipping sector.

If it succeeds, this might act as a blueprint for other industries in reaching a low-carbon global economy.