World’s first global CO2 levy inches closer

LONDON: The shipping industry is being lined up as a guinea pig for a world-first: a global, mandatory charge on greenhouse gas (GHG) emissions.

The International Maritime Organisation (IMO) – which regulates shipping worldwide – inched closer toward such a levy at talks held in London this week.

The United Nations agency plans to finalise the detail of the measure next year, and have it introduced in 2027.

While the timeline is clear, there’s far less certainty about how it will actually work and whether there will be a significant impact on the emissions of an industry that carries 80% of world trade and spews more than a billion tonnes of carbon dioxide into the atmosphere each year.

“We will have a pricing mechanism,” said the IMO’s secretary-general, Arsenio Dominguez, in a meeting with journalists at the organisation’s London headquarters. “Of that, I have no doubt.”

Countries including the Marshall Islands – the flag state for thousands of vessels – earlier submitted a proposal for a minimum emissions charge of US$150 per tonne of CO2-equivalent, which would add hundreds of dollars to shippers’ fuel bills for every ton of oil they burn.

Others, including European Union nations, Canada and China have submitted separate documents discussing GHG pricing.

Nailing down precisely how the money will be raised, where it will ultimately go and, most importantly, what the price should be, will be tough. — Reuters