BIMCO's updated position has been approved by the BIMCO Board of Directors.
Parties to the United Nations Framework Convention on Climate Change (UNFCCC) have recognised that the convention is unsuitable to address emissions from international shipping. The Paris Agreement, adopted at COP21 in December 2015, is silent about emissions from international shipping. It does, however, expect that “developed country Parties should continue taking the lead by undertaking economy-wide absolute emission reduction targets”. The overall aim of the Paris Agreement is “holding the increase in the global average temperature to well below 2°C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5°C above pre-industrial levels”.
The International Maritime Organization (IMO) has agreed on a Road Map to develop a Comprehensive IMO GHG Strategy by 2023. The Initial Strategy (IS) was adopted at MEPC 72 in April 2018 with a vision to decarbonise shipping as soon as possible. The IS contains the following important objectives:
Tackling the barriers to transition may be the single most important issue facing the shipping industry. The barriers cut across commercial business practices, which are normally beyond the scope of international regulation.
As the transition is likely to take a generation of ships, it necessitates having a mechanism to facilitate a level playing field in the marketplace for ships of both conventional and novel technological state. This is because freight rates are unlikely to correlate with the cost of operating ships using vastly more expensive fuels as long as cheap fossil fuel alternatives exist.
The IMO decided at MEPC 57 to adopt nine fundamental principles, to which a future market-based measure (MBM) shall adhere by being:
1. effective in contributing to the reduction of total global greenhouse gas emissions
2. binding and equally applicable to all flag States in order to avoid evasion
4. able to limit, or at least, effectively minimize competitive distortion
5. based on sustainable environmental development without penalizing global trade and growth
6. based on a goal-based approach and not prescribe specific methods
7. supportive of promoting and facilitating technical innovation and R&D in the entire shipping sector
8. accommodating to leading technologies in the field of energy efficiency
9. practical, transparent, fraud-free, and easy to administer.
Removing the barriers for transition requires new commercial solutions and shared responsibilities between charterers and shipowners. BIMCO will develop the necessary contractual solutions to assist the transition.
Recent report from the Intergovernmental Panel on Climate Change (IPCC) states that meeting the temperature goals of the Paris Agreement requires deep cuts in global GHG reductions before 2030 and carbon neutrality by 2050.
1 Reference to carbon or CO2 in this paper should be read as CO2-eq to include the warming effects of all anthropogenic greenhouse gasses.
Veritas Petroleum Services (VPS) publish regular Bunker Alerts based entirely on fuel samples and have kindly permitted BIMCO’s Members to access this information.
The Bunker Alerts are not intended to be an evaluation of overall bunker quality in the port or area concerned, but usually highlight a specific parameter within the fuel which has raised a quality issue.
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