Maritime Affairs Program (MAP) Handbill Spotlight

The global maritime shipping industry is increasingly acknowledged as a critical challenge in combating climate change. It emits more than 0.86 gigatonnes of CO₂ per year and contributes to roughly 10% of transport-related emissions globally. Despite improvements in energy efficiency, absolute emissions have continued to rise due to increases in shipping demands, and the need for stronger emission reduction action is like never before. In 2018, the organization adopted its initial greenhouse gas emission reduction strategy, which called for reducing the sector’s carbon intensity by at least 40 percent by 2030 and set an ambition to cut total greenhouse gas emissions by 50 percent by 2050. The strategy also introduced the first mandatory energy-efficiency measures for ships, covering both new vessels and the existing fleet. This framework was significantly strengthened in 2023, when member states agreed to a revised GHG Strategy that set a net-zero target for international shipping “by or around 2050,” alongside indicative checkpoints of at least 20 percent emission reductions by 2030 and 70 percent by 2040, and a requirement that zero or near zero-emission fuels represent at least 5 percent of marine energy use by 2030. The 2023 Strategy also launched the development of mid-term measures combining a global fuel-intensity standard and a maritime GHG pricing mechanism. 

Recent Events

Building on the aforementioned commitments, the IMO advanced a more comprehensive regulatory package in April 2025—commonly referred to as the proposed Net-Zero Framework—which sought to combine a global fuel-intensity standard with a pricing mechanism and a dedicated decarbonization fund. The proposal combined a global marine fuel-intensity standard with a market-based compliance mechanism designed to curb emissions from ships of 5,000 gross tons and above. These vessels account for roughly 85 percent of global maritime emissions. Under the draft text, ships exceeding the annual emissions limit would purchase Remedial Units or pay a carbon fee, while more efficient vessels could earn compensation for emission reductions. Revenues were also slated to flow into a new IMO Net-Zero Fund projected to raise $11–12 billion annually between 2028 and 2030, supporting alternative-fuel infrastructure, vessel retrofits, and capacity-building in developing and small-island states.

However, despite broad expectations that approval would be a formality, delegates unexpectedly voted to defer adoption of the Net-Zero Framework by one year during the second extraordinary session of the Marine Environment Protection Committee in October 2025. The United States and Saudi Arabia led the opposition, following public statements by President Trump rejecting what he called a “global green new scam tax on shipping.” 

Several maritime nations—including many EU member states and Pacific Island countries—expressed disappointment, and they noted that many countries had been ready to adopt the rules and the delay creates a sense of failure. Nevertheless, key leaders remain optimistic about the future of the emission package. IMO Secretary-General Arsenio Dominguez said at COP30 in Brazil that he is confident countries can still reach an agreement on a carbon fee for shipping and pledged to continue campaigning for the framework despite the temporary setback. He believes that IMO is learning from the failure and will not stop here. Dutch climate envoy Prince Jaime likewise underscored the importance of maintaining constructive engagement over the coming year to build consensus ahead of the next round of negotiations.

Keep In Mind

The one-year postponement of the Net-Zero Framework carries significant negative momentum for maritime decarbonization. The delay reintroduces uncertainty for the private sector by disrupting investment planning and slowing capital flows into alternative-fuel infrastructure. Companies that had already begun integrating carbon-pricing assumptions into charterparties, fuel-supply agreements, and ship-management contracts now face costly revisions, as provisions drafted around an expected 2027–2028 compliance timeline no longer align with regulatory reality and may need to be renegotiated again once the framework returns in 2026.

The postponement also compresses the IMO’s emissions-reduction timeline. Under the schedule envisioned when member states negotiated the package in April 2025, mid-term measures were expected to enter into force within two to three years of adoption, placing the first compliance period in the late 2020s. With the framework now unlikely to begin its first cycle before 2028 or 2029, both fuel-intensity limits and emissions-pricing obligations will come online later than planned, narrowing the available window for progress toward the framework’s mid-2030s milestones. Meanwhile, the deferred vote delays the allocation of the proposed IMO Net-Zero Fund—projected to raise $11–12 billion annually between 2028 and 2030—creating additional challenges for developing countries and small island states that rely on early assistance to manage transition costs and climate vulnerability. This funding was intended to support alternative-fuel bunkering infrastructure, energy-efficiency retrofits, and capacity-building programs; losing even a single year of financing slows these efforts and widens the gap between states with the means to transition and those without.

Nevertheless, although the delay underscores the uncertainty and political fragility surrounding global maritime climate governance, the broader direction of the transition remains unchanged. IMO leadership and supportive member states maintain that negotiations will resume in 2026, suggesting that while regulatory certainty has slipped, the long-term shift toward a global emissions framework for shipping remains firmly on the horizon.