Shipping Industry Renews Calls for $5B R&D Fund for Decarbonization

Representatives for all the major segments of the shipping industry joined together announcing their support for a proposed $5 billion fund which with monies from the shipping lines would coordinate and support decarbonization efforts. The proposal led by eight governments representing a major stake in the world’s shipping industry is being submitted today to the International Maritime Organization (IMO) designed to become the nexus of the decarbonization effort.

According to the representatives of the shipping industry, zero-emission ocean going ships deployed at the scale required by 2030 will be “near impossible” if this proposal is not supported by IMO member states. Being led by the governments of Georgia, Greece, Japan, Liberia, Malta, Nigeria, Singapore, and Switzerland, the proposal submitted to the IMO is to establish a $5 billion “IMO Maritime Research Fund” using mandatory contributions from the world’s shipping companies.

This fund would support a new International Maritime Research and Development Board (IMRB) to commission collaborative programs for the applied research and development R&D of zero-carbon technologies, specifically tailored for maritime application. This would include the development of working prototypes and would also assist CO2 reduction projects in developing countries, including Pacific island nations.

The proposal advances a concept first proposed by the shipping industry in December 2019, initial consideration of which by IMO (MEPC 75) was delayed until November 2020 due to COVID 19. The new proposal addresses various operational, administrative, legal, and governance aspects put forward by governments at MEPC 75.

Reiterating that the global shipping industry is giving its full and unequivocal backing to the proposal, the representatives of BIMCO, CLIA, IMCA, INTERCARGO, INTERFERRY, International Chamber of Shipping INTERTANKO, IPTA, and World Shipping Council, said they believe that this will act as a catalyst to complete decarbonization of maritime transport by deployment at scale of zero-carbon ships within a decade.

They believe that this is the only fully detailed proposal available to deliver the speed and scale called for by UN Secretary-General, António Guterres. Decarbonization they say can only take place with a significant acceleration of R&D, as zero-carbon technologies do not yet exist that can be applied at scale to large ocean-going ships. A well-funded R&D program, which the industry has agreed to pay for within a global regulatory framework, needs to commence immediately under the supervision of the IMO.

“Shipping leaders are calling on governments to ‘be on the right side of history’ and take forward the proposal at a critical meeting in June with a view to approval in November,” the joint statement said. The proposal, which includes a new draft Chapter 6 to Annex VI of the MARPOL Convention, is being submitted for consideration at the next meeting of the IMO Marine Environment Protection Committee (MEPC 76) which will take place in June 2021. In November, the IMO will be meeting in London coinciding with the next UN Climate Conference (COP 26) in Glasgow.