A proposal from the International Chamber of Shipping and Intercargo calling for a new carbon levy is short on some important specifics but clear on one critical aspect: the charterer should pay for the proposed CO2 tax.
In a situation where a vessel is hired out, responsibility for the purchase of bunkers is with the charterer, so payment to the proposed climate fund should also rest with the charterer, the groups said in the proposal to the International Maritime Organization.
The responsibility for payment is clearly defined in proposed amendments to Marpol Annex VI. The proposal’s joint sponsors suggest amending the convention would be the quickest way to mandate the levy and establish an IMO Climate Fund.
The alternative would be to a create a new international convention along the lines of the International Oil Pollution Compensation Funds, which also involved the collection of money under the IMO and took years to establish.
The idea is that the IMO-controlled Climate Fund will operate through the same mechanism developed to establish the IMO Maritime Research Fund (IMRF).
The IMRF is a separate industry proposal that involves the establishment of a decarbonisation research and development fund based on a $2 per tonne fuel levy.
Shipowners kept out
The IMO Climate Fund would be used to incentivise the use of zero-carbon fuels and provide bunkering infrastructure. However, shipowners will be kept out of the decision-making process on how it is spent.
Under the proposed amendments, a statement of compliance would be awarded to a ship after its IMO Climate Fund annual statement had been approved based on fuel consumption records.
Different carbon levy rates might also be applied, depending on which fuel has been used. These include different cost-per-tonne carbon emission rates for fuel oil, LPG, LNG, methanol and ethanol.
Another consideration is how to keep the IMO Climate Fund in compliance with the United Nations' principle of common but differentiated responsibilities (CBDR).
The CBDR acknowledges that developing countries have lesser capabilities to contribute towards climate change mitigation measures.
As such, funds may be initially aimed at decarbonisation and zero-carbon fuel infrastructure initiatives in least developed countries or small island developing states.
