mile) for different ship types and sizes. The EEDI requirements are to be implemented in phases. New container ships, general cargo ships, LNG carriers, large gas carriers (>15,000 DWT), and cruise ships (having non-conventional propulsion, are all subject to the Phase 3 EEDI requirements from 1 April 2022. For most other ships, Phase 3 comes into force in 1 January 2025.
[2] As per IMO Resolution MEPC.203(62), ‘new ship’ means a ship:
1. for which the building contract is placed on or after 1 January 2013; or
2. in the absence of a building contract, the keel of which is laid or which is at a similar stage of construction on or after 1 July 2013; or
3. the delivery of which is on or after 1 July 2015.
8. Are the EEXI, EEDI, and CII measures enough to hit the lower emission targets in the IMO’s Initial Strategy?
Some experts believe the 2030 target can be achieved through the EEXI, EEDI, and CII measures. However, it is widely accepted that much more will need to be done to meet the 2050 targets. In particular, the adoption of alternative fuel technologies is required.
9.
Is there a possibility that the IMO’s GHG strategy will be revised?
Yes. Delegates at the 2021 United Nations Climate Change Conference (COP26) called for the shipping community to go further than the Initial Strategy and to aim for net zero by 2050. This was re-iterated at the seventy-seventh session of the Marine Environment Protection Committee (MEPC-77) held from 22 to 26 November 2021. Some member states expressed the view that the short-term measures adopted by MEPC-76 in June 2021 are inadequate to address the Paris Agreement temperature goals and that more efforts are needed. Consequently, MEPC-77 agreed to continue the discussions on mid and long-term measures and to initiate
a revision of the Initial Strategy. The final draft of the Revised Strategy is expected to be considered for adoption by MEPC-80 (scheduled for spring 2023).
10. Are there regional or national efforts to address GHG emissions and the use of alternative fuels?
Yes, in some regions (i.e., EU) and it is likely more will follow.
The European Union - The EU is moving ahead with its own plan to reduce GHG emissions from the shipping sector. For example, since 2018, large ships over 5,000 GT loading or unloading cargo or passengers at ports in the European Economic Area have had to monitor, report, and verify CO2 emissions (EU- MRV). Further, in July 2021, the European Commission announced its ‘Fit for 55’ package of proposals. The proposals are intended to reduce the EU’s total GHG emissions by 55% by 2030 with the goal of complete decarbonisation by 2050. The proposals are subject to further discussion and negotiation with the European Council and European Parliament and are thus not yet finalised.
In their present form, four of the ‘Fit for 55’ proposals are relevant to shipping:
▬ Emissions Trading System (ETS): The package proposes incorporating shipping in the EU’s ETS from 2023. The proposal would mandate those ships that operate within EU waters to pay for their carbon emissions with the proceeds going toward development of infrastructure for cleaner alternative fuels. The extension would apply to emissions from intra-EU voyages, to 50% of the emissions from extra-EU voyages, and to emissions from ships while at berth in EU ports. Non-compliance will result in fiscal penalties being applied and may eventually lead to the ship being banned from EU waters.
▬ Alternative Fuels Infrastructure Regulation: This proposed regulation will require EU member states to provide adequate recharging and refuelling infrastructure which will effectively involve ramping up the availability of LNG by 2025
and onshore electrical power by 2030 in core EU ports. The introduction of this regulation will involve repealing Directive 2014/94/EU on the deployment of alternative fuels infrastructure.
▬ Energy Taxation Directive: This proposal would remove the tax exemption for conventional fuels used at and between EU ports as of 1 January 2023. The tax exemption presently in place for international bunkering for extra-EU voyages will remain. The tax rate for heavy fuel oil will be approximately €37 per tonne whereas the tax rate for LNG will initially be €0.6 per gigajoule. Alternative fuels will be tax exempt for a 10-year period.
▬ FuelEU Maritime Regulation: The proposed regulation would impose limits on GHG emissions (including CO2, methane, and nitrous oxide) of ships of 5,000 GT and above, regardless of their flag, arriving or departing EU ports and an obligation on EU ports to become carbon neutral. If adopted, the regulation will require ships to reduce their annual GHG intensity by 2% in 2025 as compared to 2020 levels with incremental increases over the years to achieve a 75% reduction by January 2050.
The United States - President Biden announced in April 2021 that the United States (US) will join the IMO effort to reduce GHG emissions in international shipping. He suggested that the US will aim to achieve net zero GHG emissions by 2050, with an interim goal to cut GHG emissions by 50% by 2030 (compared to 2005 emission levels – which was a peak year for emissions in the US). The US has not, to date, enacted its own specific measures for achieving such GHG emission reduction targets.
However, individual states may pursue their own measures. For instance, California modified a regulation in 2020 which will require every vessel calling at a regulated Californian port either to use shore power or a technology approved by the California Air Resources Board to reduce specified emissions. The regulation (known as the ‘At Berth’ regulation) currently applies to container ships, reefers, and cruise ships. The updated regulation applies as of 2023 when container
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