Annex - Initial IMO Strategy on Reduction of GHG Emissions from Ships

 1 INTRODUCTION

1.1 The International Maritime Organization (IMO) is the United Nations specialized agency responsible for safe, secure and efficient shipping and the prevention of pollution from ships.

1.2 The Strategy represents the continuation of work of IMO as the appropriate international body to address greenhouse gas (GHG) emissions from international shipping. This work includes Assembly resolution A.963(23) on IMO policies and practices related to the reduction of greenhouse gas emissions from ships, adopted on 5 December 2003, urging the Marine Environment Protection Committee (MEPC) to identify and develop the mechanisms needed to achieve the limitation or reduction of GHG emissions from international shipping.

1.3 In response to the Assembly's request, work to address GHG emissions from ships has been undertaken, including inter alia:

• .1 MEPC 62 (July 2011) adopted resolution MEPC.203(62) on Inclusion of regulations on energy efficiency for ships in MARPOL Annex VI introducing mandatory technical (EEDI) and operational (SEEMP) measures for the energy efficiency of ships. To date more than 2,700 new ships have been certified to the energy efficiency design requirement;

• .2 MEPC 65 (May 2013) adopted resolution MEPC.229(65) on Promotion of technical co-operation and transfer of technology relating to the improvement of energy efficiency of ships, which, among other things, requests IMO, through its various programmes (ITCP,^footnote GloMEEP project,^footnote MTCC network,^footnote etc.), to provide technical assistance to Member States to enable cooperation in the transfer of energy efficient technologies, in particular to developing countries; and

• .3 MEPC 70 (October 2016) adopted, by resolution MEPC.278(70), amendments to MARPOL Annex VI to introduce the data collection system for fuel oil consumption of ships, containing mandatory requirements for ships to record and report their fuel oil consumption. Ships of 5,000 gross tonnage and above (representing approximately 85% of the total CO₂ emissions from international shipping) are required to collect consumption data for each type of fuel oil they use, as well as other, additional, specified data including proxies for "transport work".

1.4 This Initial Strategy is the first milestone set out in the Roadmap for developing a comprehensive IMO Strategy on reduction of GHG emissions from ships (the Roadmap) approved at MEPC 70. The Roadmap identifies that a revised Strategy is to be adopted in 2023.

Context

1.5 The Initial Strategy falls within a broader context including:

• .1 other existing instruments related to the law of the sea, including UNCLOS, and to climate change, including the UNFCCC and its related legal instruments, including the Paris Agreement;

• .2 the leading role of the Organization for the development, adoption and assistance in implementation of environmental regulations applicable to international shipping;

• .3 the decision of the thirtieth session of the Assembly in December 2017 that adopted for the Organization a Strategic Direction entitled "Respond to climate change"; and

• .4 the United Nations 2030 Agenda for Sustainable Development.

Emissions and emission scenarios

1.6 The Third IMO GHG Study 2014 has estimated that GHG emissions from international shipping in 2012 accounted for some 2.2% of anthropogenic CO₂ emissions and that such emissions could grow by between 50% and 250% by 2050. Future IMO GHG studies would help reduce the uncertainties associated with these emission estimates and scenarios.

Objectives of the Initial Strategy

1.7 The Initial Strategy is aimed at:

• .1 enhancing IMO's contribution to global efforts by addressing GHG emissions from international shipping. International efforts in addressing GHG emissions include the Paris Agreement and its goals and the United Nations 2030 Agenda for Sustainable Development and its SDG 13: "Take urgent action to combat climate change and its impacts";

• .2 identifying actions to be implemented by the international shipping sector, as appropriate, while addressing impacts on States and recognizing the critical role of international shipping in supporting the continued development of global trade and maritime transport services; and

• .3 identifying actions and measures, as appropriate, to help achieve the above objectives, including incentives for research and development and monitoring of GHG emissions from international shipping.

2 VISION

IMO remains committed to reducing GHG emissions from international shipping and, as a matter of urgency, aims to phase them out as soon as possible in this century.

3 LEVELS OF AMBITION AND GUIDING PRINCIPLES

Levels of ambition

3.1 Subject to amendment depending on reviews to be conducted by the Organization, the Initial Strategy identifies levels of ambition for the international shipping sector noting that technological innovation and the global introduction of alternative fuels and/or energy sources for international shipping will be integral to achieve the overall ambition. The reviews should take into account updated emission estimates, emissions reduction options for international shipping, and the reports of the Intergovernmental Panel on Climate Change (IPCC), as relevant. Levels of ambition directing the Initial Strategy are as follows:

• .1 carbon intensity of the ship to decline through implementation of further phases of the energy efficiency design index (EEDI) for new ships

  to review with the aim to strengthen the energy efficiency design requirements for ships with the percentage improvement for each phase to be determined for each ship type, as appropriate;

• .2 carbon intensity of international shipping to decline

  to reduce CO₂ emissions per transport work, as an average across international shipping, by at least 40% by 2030, pursuing efforts towards 70% by 2050, compared to 2008; and

• .3 GHG emissions from international shipping to peak and decline

  to peak GHG emissions from international shipping as soon as possible and to reduce the total annual GHG emissions by at least 50% by 2050 compared to 2008 whilst pursuing efforts towards phasing them out as called for in the Vision as a point on a pathway of CO₂ emissions reduction consistent with the Paris Agreement temperature goals.

Guiding principles

3.2 The principles guiding the Initial Strategy include:

• .1 the need to be cognizant of the principles enshrined in instruments already developed, such as:

  • .1 the principle of non-discrimination and the principle of no more favourable treatment, enshrined in MARPOL and other IMO conventions; and

  • .2 the principle of common but differentiated responsibilities and respective capabilities, in the light of different national circumstances, enshrined in UNFCCC, its Kyoto Protocol and the Paris Agreement;

• .2 the requirement for all ships to give full and complete effect, regardless of flag, to implementing mandatory measures to ensure the effective implementation of this strategy;

• .3 the need to consider the impacts of measures on States, including developing countries, in particular, on LDCs and SIDS as noted by MEPC 68 (MEPC 68/21, paragraphs 4.18 to 4.19) and their specific emerging needs, as recognized in the Organization's Strategic Plan (resolution A.1110(30)); and

• .4 the need for evidence-based decision-making balanced with the precautionary approach as set out in resolution MEPC.67(37).

4 LIST OF CANDIDATE SHORT-, MID- AND LONG-TERM FURTHER MEASURES WITH POSSIBLE TIMELINES AND THEIR IMPACTS ON STATES

Timelines

4.1 Candidate measures set out in this Initial Strategy should be consistent with the following timelines:

• .1 possible short-term measures could be measures finalized and agreed by the Committee between 2018 and 2023. Dates of entry into force and when the measure can effectively start to reduce GHG emissions would be defined for each measure individually;

• .2 possible mid-term measures could be measures finalized and agreed by the Committee between 2023 and 2030. Dates of entry into force and when the measure can effectively start to reduce GHG emissions would be defined for each measure individually; and

• .3 possible long-term measures could be measures finalized and agreed by the Committee beyond 2030. Dates of entry into force and when the measure can effectively start to reduce GHG emissions would be defined for each measure individually.

4.2 In aiming for early action, the timeline for short-term measures should prioritize potential early measures that the Organization could develop, while recognizing those already adopted, including MARPOL Annex VI requirements relevant for climate change, with a view to achieve further reduction of GHG emissions from international shipping before 2023.

4.3 Certain mid- and long-term measures will require work to commence prior to 2023.

4.4 These timelines should be revised as appropriate as additional information becomes available.

4.5 Short-, mid- and long-term further measures to be included in the Revised IMO GHG Strategy should be accompanied by implementation schedules.

4.6 The list of candidate measures is non-exhaustive and is without prejudice to measures the Organization may further consider and adopt.

Candidate short-term measures

4.7 Measures can be categorized as those the effect of which is to directly reduce GHG emissions from ships and those which support action to reduce GHG emissions from ships. All the following candidate measures^footnote represent possible short-term further action of the Organization on matters related to the reduction of GHG emissions from ships:

• .1 further improvement of the existing energy efficiency framework with a focus on EEDI and SEEMP, taking into account the outcome of the review of EEDI regulations;

• .2 develop technical and operational energy efficiency measures for both new and existing ships, including consideration of indicators in line with the three-step approach that can be utilized to indicate and enhance the energy efficiency performance of shipping, e.g. Annual Efficiency Ratio (AER), Energy Efficiency per Service Hour (EESH), Individual Ship Performance Indicator (ISPI) and Fuel Oil Reduction Strategy (FORS);

• .3 establishment of an Existing Fleet Improvement Programme;

• .4 consider and analyse the use of speed optimization and speed reduction as a measure, taking into account safety issues, distance travelled, distortion of the market or trade and that such measure does not impact on shipping's capability to serve remote geographic areas;

• .5 consider and analyse measures to address emissions of methane and further enhance measures to address emissions of Volatile Organic Compounds;

• .6 encourage the development and update of national action plans to develop policies and strategies to address GHG emissions from international shipping in accordance with guidelines to be developed by the Organization, taking into account the need to avoid regional or unilateral measures;

• .7 continue and enhance technical cooperation and capacity-building activities under the ITCP;

• .8 consider and analyse measures to encourage port developments and activities globally to facilitate reduction of GHG emissions from shipping, including provision of ship and shoreside/onshore power supply from renewable sources, infrastructure to support supply of alternative low-carbon and zero-carbon fuels, and to further optimize the logistic chain and its planning, including ports;

• .9 initiate research and development activities addressing marine propulsion, alternative low-carbon and zero-carbon fuels, and innovative technologies to further enhance the energy efficiency of ships and establish an International Maritime Research Board to coordinate and oversee these R&D efforts;

• .10 incentives for first movers to develop and take up new technologies;

• .11 develop robust lifecycle GHG/carbon intensity guidelines for all types of fuels, in order to prepare for an implementation programme for effective uptake of alternative low-carbon and zero-carbon fuels;

• .12 actively promote the work of the Organization to the international community, in particular, to highlight that the Organization, since the 1990s, has developed and adopted technical and operational measures that have consistently provided a reduction of air emissions from ships, and that measures could support the Sustainable Development Goals, including SDG 13 on Climate Change; and

• .13 undertake additional GHG emission studies and consider other studies to inform policy decisions, including the updating of Marginal Abatement Cost Curves and alternative low-carbon and zero-carbon fuels.

Candidate mid-term measures

4.8 Measures can be categorized as those the effect of which is to directly reduce GHG emissions from ships and those which support action to reduce GHG emissions from ships. All the following candidate measures represent possible mid-term further action of the Organization on matters related to the reduction of GHG emissions from ships:

• .1 implementation programme for the effective uptake of alternative low-carbon and zero-carbon fuels, including update of national actions plans to specifically consider such fuels;

• .2 operational energy efficiency measures for both new and existing ships including indicators in line with three-step approach that can be utilized to indicate and enhance the energy efficiency performance of ships;

• .3 new/innovative emission reduction mechanism(s), possibly including Market-based Measures (MBMs), to incentivize GHG emission reduction;

• .4 further continue and enhance technical cooperation and capacity-building activities such as under the ITCP; and

• .5 development of a feedback mechanism to enable lessons learned on implementation of measures to be collated and shared through a possible information exchange on best practice.

Candidate long-term measures

4.9 All the following candidate measures represent possible long-term further action of the Organization on matters related to the reduction of GHG emissions from ships:

• .1 pursue the development and provision of zero-carbon or fossil-free fuels to enable the shipping sector to assess and consider decarbonization in the second half of the century; and

• .2 encourage and facilitate the general adoption of other possible new/innovative emission reduction mechanism(s).

Impacts on States

4.10 The impacts on States of a measure should be assessed and taken into account as appropriate before adoption of the measure. Particular attention should be paid to the needs of developing countries, especially small island developing States (SIDS) and least developed countries (LDCs).

4.11 When assessing impacts on States the impact of a measure should be considered, as appropriate, inter alia, in the following terms:

• .1 geographic remoteness of and connectivity to main markets;

• .2 cargo value and type;

• .3 transport dependency;

• .4 transport costs;

• .5 food security;

• .6 disaster response;

• .7 cost-effectiveness; and

• .8 socio-economic progress and development.

4.12 The specification for and agreement on the procedure for assessing and taking into account the impacts of measures related to international shipping on States should be undertaken as a matter of urgency as part of the follow-up actions.

4.13 Disproportionately negative impacts should be assessed and addressed, as appropriate.

5 BARRIERS AND SUPPORTIVE MEASURES; CAPACITY-BUILDING AND TECHNICAL COOPERATION; R&D

5.1 The Committee recognizes that developing countries, in particular LDCs and SIDS, have special needs with regard to capacity-building and technical cooperation.

5.2 The Committee acknowledges that development and making globally available new energy sources that are safe for ships could be a specific barrier to the implementation of possible measures.

5.3 The Committee could assist the efforts to promote low-carbon technologies by facilitating public-private partnerships and information exchange.

5.4 The Committee should continue to provide mechanisms for facilitating information sharing, technology transfer, capacity-building and technical cooperation, taking into account resolution MEPC.229(65) on Promotion of technical co-operation and transfer of technology relating to the improvement of energy efficiency of ships.

5.5 The Organization is requested to assess periodically the provision of financial and technological resources and capacity-building to implement the Strategy through the ITCP and other initiatives including the GloMEEP project and the MTCC network.

6 FOLLOW-UP ACTIONS TOWARDS THE DEVELOPMENT OF THE REVISED STRATEGY

6.1 A programme of follow-up actions of the Initial Strategy should be developed.

6.2 The key stages for the adoption of a Revised IMO GHG Strategy in 2023 as set out in the Roadmap, are as follows:

6.3 The Marginal Abatement Cost Curve (MACC) for each measure, as appropriate, should be ascertained and updated, and then evaluated on a regular basis.

7 PERIODIC REVIEW OF THE STRATEGY

7.1 The Revised Strategy is to be adopted in spring 2023.

7.2 The Revised Strategy should be subject to a review five years after its final adoption.

7.3 The Committee should undertake the review including defining the scope of the review and its terms of reference.