Countries are gathering to discuss what may be the world’s first global carbon tax on shipping emissions. The International Maritime Organization (IMO) which regulates shipping around the world is holding an important meeting in London this week to decide if they will create new regulations to reduce pollution caused by international shipping.
The IMO has targeted net-zero emissions of greenhouse gases from shipping by about 2050. In order to get there, the organization is weighing a global emission price and fuel standard that would promote cleaner fuels such as hydrogen, methanol and ammonia.
Today, the majority of ships use heavy fuel oil which emits huge quantities of carbon dioxide. Shipping contributes around 3% to global emissions and with increasing trade and bigger ships, that figure may increase.
One of the proposals initiated by Pacific island nations suggests a uniform rate tax on every metric ton of greenhouse gas that ships emit. It would generate funds to enable poor nations to transition to cleaner shipping and make the shift equitable. More than 60 nations and key industry associations back the proposal, claiming it’s the best option to accelerate the sector to become green.
But nations such as China, Brazil and Saudi Arabia favor a credit trading system where vessels can purchase or accumulate credits depending on their emissions. Others fear this may allow richer ship owners to continue polluting.
If countries approve the rules this week, they would become formally approved in October and in force by 2027. This would be a huge step toward addressing climate change globally and revolutionizing the way goods are transported around the globe.
