Maritime Law: Maritime Decarbonization

Pratt's Energy Law Report

As the international shipping industry prepares to reduce emissions, there are many recent developments that present both obstacles and opportunities that must be explored while preparing to set sail on the challenge.

IMO Timeline and Introduction to Initial Strategy

Shipping is already the most carbon-friendly form of transportation. Despite carrying approximately 90 percent of the world’s goods, shipping only accounts for about 2.9 percent of global greenhouse gas emissions. While the maritime industry and its regulatory body, the International Maritime Organization (“IMO”), rightly are trying to reduce this number, the outsized role of shipping in the world economy and its relative impact on global emissions should be the starting point of any analysis.

A key aspect in the debate on how to decarbonize centers is on the difference in gross output as opposed to efficiency. The IMO’s strategy contains targets for both types of metrics. The current goal seeks to cut overall greenhouse gas (“GHG”) emissions by at least half by 2050 (using 2008 as a baseline). On the efficiency side, the shipping industry seeks to reduce GHG emissions per transport work by 40 percent in 2030 and 70 percent by 2050.

Attaining such targets will require innovation in operations and approaches. Shipping companies are working to reduce emissions and increase shipboard efficiency, and the IMO is coordinating measuring these approaches.

This will be done in two ways.

First, the technical aspects and design of vessels will be regulated by the new Energy Efficiency Existing Ships Index (“EEXI”) for existing ships. EEXI regulations exist for an “Attained EEXI” to be calculated for each ship, and a “Required EEXI” for specified ship types.

Second, the operational aspect will be done by way of the new Carbon Intensity Indicators (“CII”) index, which categorizes every ship in categories A to E in terms of its operational efficiency based upon the vessel’s Data Collection Service (“DCS”) information. Aspects of a vessel’s CII will need to be documented under the existing framework of the Ship Energy Efficiency Management Plan (“SEEMP”). On or before January 1, 2023, ships of 5,000 GT and above will need to revise their SEEMP.

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“Maritime Law: Maritime Decarbonization,” by Stefanos N. Roulakis and Vanessa C. DiDomenico was published in the February 2022 edition of Pratt's Energy Law Report (Vol. 22, No. 2), an A.S. Pratt Publication, LexisNexis. Reprinted with permission.

This article was first published in the MAINBRACE: December 2021, Blank Rome’s maritime newsletter.