$100 per tonne emissions levy put forward by the Marshall Islands and Solomon Islands

Upping the stakes ahead of this year’s crunch Marine Environment Protection Committee (MEPC) meeting at the International Maritime Organization (IMO), the Marshall Islands and the Solomon Islands have put forward a proposal to establish a universal, mandatory greenhouse gas (GHG) levy with an entry price of $100 per tonne/CO2e with regular upward ratchets following review.

The two countries lashed current proposals being put forward to cut shipping’s carbon footprint as inadequate.

Wednesday saw a $5bn decarbonisation R&D proposal put forward by nine global shipping associations, endorsed by a host of IMO member states including Japan and Singapore. The R&D concept works out at an extra $2 per tonne of bunker fuel for shipping lines.

“As global GHG emissions continue to increase, we recognise that the international shipping sector must bear a proportionate responsibility for its share of GHG emissions. Current measures under consideration by the MEPC are inadequate to align the international shipping sector on the trajectory required to limit temperature increase to the Paris Agreement goal of 1.5 degrees Celsius. Our proposal helps to keep this goal in sight,” commented the Marshall Islands’ ambassador to Fiji, Albon Ishoda.

Current measures under consideration by the MEPC are inadequate

The Marshall Islands and Solomon Islands proposal would make decarbonised shipping fuel and technologies cost competitive with business-as-usual emission-based technology options, Ishoda said.

The majority of the funds raised from the levy would help climate vulnerable countries meet different climate change adaptation and mitigation needs. Another portion of funds would be directed to subsidise the research, development, and deployment of new technologies and fuels administrated under the mandate of the IMO.

The proposal to the IMO claims that far more substantive mid-term measures must now be agreed promptly if they are to be defined and “shovel ready” by 2023.

The proposal also took aim at emissions trading schemes (ETSs), something the European Union is leading with others also contemplating this measure for shipping. The proposal hit out at the concept of an ETS as a “patchwork quilt”, saying these schemes serve as a “poor substitute for a universal regime” likely to create widening inequity for the most disadvantaged nations and the climate vulnerable in particular.

There are plenty of other carbon levy ideas circulating ahead of this year’s MEPC gathering. Multinational commodity trading company Trafigura, for instance, has proposed a self-financing system where a levy is charged on the use of fuels with a CO2-equivalent intensity above an agreed benchmark level, and a subsidy is provided for fuels with a CO2-equivalent profile below that level. Trafigura analysis suggests that the levy should be between $250-$300 per tonne of CO2-equivalent.

Splash will be bringing readers all key developments from this June’s MEPC meet-up.

Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.


  1. There is something missing in the diagram: enforcement costs. People are going to cheat, massively, “‘cos it’s a victimless crime, innit?”

    Still, once you’ve got them by the $100 a tonne, and enforced it, their hearts and minds are sure to follow…

Back to top button