MEPC 80: IMO’s last chance to satisfy the Paris Agreement?
The 80th session of the IMO’s Marine Environment Protection Committee (MEPC 80) was held July 3 to 7. Please note the report from our friends at DNV.
This session was beforehand described by green NGOs as the last opportunity for the IMO to come to an agreement that would align international shipping with the 1.5-degree target outlined by the Paris Agreement. For this reason, member states were hard at work finding a compromise that would eventually please none but satisfy many. It was important for all stakeholders to reach an agreement. If not, we risked that much needed technical discussions would have been put on hold.
Speaking for the maritime industry, we have really been sitting on our hands for the past few sessions of the MEPC, just waiting to see enough loose ends tied up together into a coherent framework for shipowners to have enough info to make informed decisions. Although getting closer, we are not quite there yet.
On the overall IMO ambition, we saw a new set of more stringent targets. A reduction of well-to-wake GHG emissions by 20 per cent, striving for 30 per cent in 2030 was more or less what we were already aiming for. However, a whopping 70 per cent reduction, striving for 80 per cent, in 2040 compared to 2008 wasn’t on our radar. The bottom line is to reach net-zero “by or around 2050”. It is not yet quite quantifiable what these figures mean in terms of per-ship-improvements between now and 2030/2040. Given the uncertainty surrounding the CII, we may well see draconian measures needed already towards the end of this decade to meet this ambitious goal.
The information to collect and report for the IMO Data Collections System (DCS) will be more comprehensive as from 2026, also including a more granular description of the energy used on board (sources and application). With a few more iterations one could hope for a harmonisation between the EU MRV system and the DCS, so that operators will only have one set of parameters on which to report.
Seeking compliance alternatives for the various GHG requirements under both the IMO and the EU, operators are asking questions on how biofuels and synthetic fuels (e-fuels) will be credited in the various frameworks. An important step to answer this was made by MEPC 80 that agreed on interim guidance (to be issued as MEPC.1/Circ.905) for the use of biofuels. The guidance takes its inspiration from what has been done by ICAO (International Civil Aviation Organization) and even refers to ICAO’s Approved Sustainability Certification Schemes and the CORSIA Sustainability Criteria (Chapter 2) for CORSIA Eligible Fuels. However, one would expect a more in-house set of parameters to be developed.
Under the ICAO approach, a biofuel needs to provide a well-to-wake GHG emissions reduction of at least 65 per cent compared to the well-to-wake emissions of fossil MGO of 94 gCO2e/MJ and meet a number of sustainability criteria (e.g. what type of biomass may be eligible). This approach is similar, but not exactly corresponding, to the criteria and parameters established in the EU’s Renewable Energy Directive II (RED II). This means that a biofuel certified for CII improvement will not necessarily be recognised by the EU ETS and vice versa. But let’s not be too critical and rather note that with the complexity of tying up all loose ends we need to be supportive when things do move forward.
The meeting also made progress on the “Guidelines on lifecycle GHG intensity of marine fuels (LCA guidelines)”. Even so, more work is required and has therefore been tasked to a Correspondence Group. So, for the time being there is still no clear path how to credit e-fuels in the IMO setting. In the EU framework, the uptake of e-fuels (dubbed Renewable Fuels of Non-Biologic Origin or RFNBOs) is actively encouraged and actually rewarded with a double credit; for every gram of GHGeq reduced through RFNBO, you are credited two grams.
Overall, IMO’s MEPC 80 made a lot of progress, but given the ambitious targets member states have set for themselves, the IMO is struggling to keep up. Haste often makes waste, resulting in poorly developed regulations – did I hear anyone say CII?