The IMO’s Revised GHG Strategy, adopted at MEPC 80 in July, represents a significant leap forwards in ambition. New analysis by UMAS shows the IMO’s targets correspond to a path on 1.55oC and 1.6oC according to the budget defined by the IPCC. The huge level of modifications to existing and new ships, even at the minimum level of ambition, which requires the average ship’s GHG intensity to be reduced by 86% by 2040, spell an end to the era of fossil fuelled shipping.
If national, regional and private actions are strengthened and more carefully dovetailed into the nature of transition the IMO’s Revised Strategy now signals, then there remains a key role to play in supporting and assisting the sector through the different transition phases.
On regional action, for example, the stringency and role of EU policies (inclusion of shipping in the EU ETS, EU fuel standards), now appears of low salience to business cases, relative to what should be anticipated from global measures. EU policies also increase the inequity of the transition, increasing cost to developing country trade, whilst transferring these revenues to high income countries.
In addition to increasing ambition, the window for early action and leadership from corporate and national action during the emergence phase has also been compressed. There is now only a small window of 3-4 years before IMO’s mid-term measures enter into force in 2027/2028. Early mover action through private action is crucial in this emergence phase of shipping’s transition but the analysis shows industry initiatives have suffered from a lack of ambition, transparency and reliability. The pressure to align with 1.5oC pathway is now even higher – otherwise what is being stated as leadership is not only greenwashing, but nothing more than compliance.
The report provides a number of recommendations to stakeholders in light of the above. Corporate actors and investors should not be complacent that decisions made on the Initial Strategy are sound, understanding and factoring in the Revised Strategy targets – especially the 2030 and 2040 targets is crucial. They must apply and align with the UN’s High Level Expert Group guidance on integrity e.g. including all scopes (1-3), interim targets and disclosure, or risk becoming irrelevant. National actors should bring forward plans for national action to be particularly focused on the period from now to 2027/28, bringing forward public/private collaborations to ensure these have a chance of fulfilling their roles during this decade and establish a definition that Green Corridors must have zero or near-zero GHG operation before 2030.