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SHIPOWNER ASSOCIATIONS CONSIDER DECARBONISATION

Monday, March 9, 2020 

The recent Rome Round Table discussions between BIMCO, Intercargo, International Chamber of Shipping (ICS) and Intertanko considered the long-term implications of the 50% reduction in greenhouse gas emissions by 2050, set by IMO.

The move was fully endorsed by the heads of the associations, who identified the need for more research and development by the industry and its suppliers as an essential focus if the 2050 target is to be met. The proposal previously put forward by industry trade bodies representing over 90% of the world merchant fleet for a US$5bn research fund has been publicly endorsed by prominent European shipowners.

Esben Poulsson (pictured), Chair of ICS said: “It is clear that the entire shipping industry takes its responsibility to limit the industry’s emissions extremely seriously. This is why we jointly submitted plans to place a $2 levy on every tonne of ships’ fuel purchased. The amount was chosen to be acceptable to developing nations. We understand that climate change can only be tackled through truly international cooperation, something that is intrinsic to shipping."

The proposal will create a $5bn R&D fund over a 10-year period and will accelerate the development of commercially viable zero-carbon emission ships by the early 2030s. This is the first major R&D initiative of its kind to be proposed by a sector on a global basis, which could provide a framework for other industries to decarbonise.

The fund does not act as a Market Based Measure or ‘carbon tax’. The purpose of the proposal is simply to accelerate the development of low-carbon and zero carbon technologies and fuels for use in the commercial maritime sector. The proposal is not intended to frustrate or delay the development of an MBM, and could form the architecture of a future levy-based MBM for shipping, that would reduce the risk of market distortion.

Sadan Kaptanoglu, President of BIMCO said: “Industry-wide cooperation is absolutely essential if we are to meet the ambitious targets set by the IMO to halve CO2 emissions by 2050. We welcome the decision of our joint Membership to support our proposal to create a $5bn R&D fund for zero-emission shipping. We hope the IMO recognises the level of support for our proposal. The invention of Teflon, penicillin and the microwave show us that innovation is often accidental. We fully expect the R&D fund to bring benefits that go far beyond the shipping industry, as well as driving down emissions in our sector."

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