15 Apr IMO Fuel Standard To Reshape Container Shipping Market
In the upcoming IMO meeting there is a strong likelihood that IMO negotiators will opt for a fuel standard rather than a carbon tax on shipping in order to achieve the organisation’s goal of net-zero emissions by or around 2050.
This touted fuel standard will mean a legally binding greenhouse gas intensity limit for the fuels themselves which would take effect in 2028 and become increasingly stringent towards 2050.
The option of a fuel standard will have far-reaching implications for the overall industry as carriers would be required to use fuels that are, currently, much higher priced than traditional options without any higher cost imposed on any other relevant party.
Therefore, the carriers would have no option but to try recoup the additional costs of the fuel standard, which means potential price increases in order to offset the cost of the alternative fuel and any associated costs such as zero or low carbon bunkers.
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