The International Maritime Organization (IMO) has reached a landmark carbon pricing agreement, which marks a significant step towards reducing emissions across the global shipping sector.
- Following 18 months of intense negotiations, the IMO’s 176 member states have endorsed a comprehensive framework aimed at significantly reducing emissions across the entire shipping sector.
- The agreement includes a worldwide carbon pricing mechanism and fuel standards that address emissions throughout the entire fuel lifecycle.
- The framework also sets the stage for vessels to be charged a base levy of $100 per tonne of CO₂ emissions, with higher penalties for vessels that exceed set thresholds.
The revenue generated from the carbon pricing mechanism, expected to reach approximately US$10 billion annually by 2030, will be used to support the adoption of low-emissions fuels and to build the necessary infrastructure for the transition. The agreement marks a major victory for climate change, with Dr. Andrew Forrest, Fortescue Executive Chairman, describing it as one of the most significant climate achievements by any heavy industry.
“This is a major victory. It represents one of the most significant climate achievements by any heavy industry,”
Dr. Forrest said. The global shipping sector has demonstrated what can be achieved through courage, conviction, and international cooperation.
The IMO agreement has attracted strong sectoral support, but Fortescue acknowledges the deeply felt disappointment of Small Island Developing States (SIDS), which had called for a universal carbon levy and more robust financing commitments. Despite this, a number of petrostates opposed the final agreement, seeking to weaken its ambition and delay implementation.
- The agreement includes a worldwide carbon pricing mechanism and fuel standards that address emissions throughout the entire fuel lifecycle.
- The revenue generated from the carbon pricing mechanism will be used to support the adoption of low-emissions fuels and to build the necessary infrastructure for the transition.
- The base levy of $100 per tonne of CO₂ emissions will be charged, with higher penalties for vessels that exceed set thresholds.
In a call to climate leadership, Dr. Forrest highlighted the need for nations to take bold action in the face of rising climate risks.
“Take just one example: Saudi Arabia is a regional leader with the capacity to unlock practical climate solutions in one of the world’s most climate-vulnerable regions,”
Dr. The Kingdom sits at the crossroads of a global energy transition and a rising humanitarian imperative.
The agreement marks a significant step towards reducing emissions across the global shipping sector, and Fortescue has played a leading role in advocating for rapid uptake of zero-emissions fuels.
- Fortescue has been a key advocate for the rapid uptake of zero-emissions fuels, including green ammonia.
- The company has demonstrated its commitment to reducing emissions through its work with the IMO and its demonstration vessel, the Fortescue Green Pioneer.
In conclusion, the IMO agreement marks a significant step towards reducing emissions across the global shipping sector, and Fortescue’s leadership in advocating for rapid uptake of zero-emissions fuels has been instrumental in achieving this goal.
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