Many of the world’s largest shipping nations decided on Friday to impose a minimum fee of $100 for every ton of greenhouse gases emitted by ships above certain thresholds, in what is effectively the first global tax on greenhouse gas emissions.
The International Maritime Organization estimates $11 billion to $13 billion in revenue annually from the fees, with the money to be put into its net zero fund to invest in fuels and technologies needed to transition to green shipping, reward low-emission ships and support developing countries so they aren’t left behind with dirty fuels and old ships. The thresholds set through the agreement will get stricter over time to try to reach the IMO’s goal of net zero across the industry by about 2050.
The agreement, reached with the United States notably absent, is expected to be formally adopted at an October meeting to take effect in 2027. The IMO, which regulates international shipping, also set a marine fuel standard to phase in cleaner fuels.
Shipping emissions have grown over the last decade to about 3% of the global total as vessels have gotten bigger, delivering more cargo per trip and using immense amounts of fuel.
IMO Secretary-General Arsenio Dominguez said the group forged a meaningful consensus in the face of complex challenges to combat climate change and modernize shipping. The shipping industry is on track to meet the net zero goal, he added.
Some environmentalists at the meeting called the agreement a “historic decision” that doesn’t go far enough. The fee doesn’t drive enough emission reductions and it won’t raise enough revenue to help developing countries transition to greener shipping, said Emma Fenton, senior director for climate diplomacy at a U.K.-based climate change nonprofit, Opportunity Green.
Fenton said the measure actually opens the door for a scenario where ships can pay to pollute instead of decarbonize, because it could be cheaper to simply absorb the fee than to make changes to reduce emissions, like switching fuels.
