IMO ISWG GHG 21: Key outcomes

A UCL Shipping and Oceans Research Group readout says that the 21st session of IMO’s Intersessional Working Group on greenhouse gas emissions (IMO ISWG GHG 21) has made steady progress ahead of MEPC 84, set to take place 27 April to 1st May.

The discussions focused on implementing the IMO’s Net Zero Framework (NZF), particularly the detailed guidelines needed to understand how it would work in practice for both governments and the shipping industry. Compared with the situation in October 2025, when a decision on adopting the NZF was postponed for 12 months, the group says there is now significantly greater clarity on how the framework could operate. This includes a more developed evidence base for assessing its potential to shape investment decisions for shipowners and broader energy transition pathways in the maritime sector.

Given the outcome of MEPC.ES2 in October 2025, many have assumed that the NZF had no future and the IMO faced a long delay and a major redesign of this key policy. This meeting’s cooperation, outputs and political landscape challenges that assumption, and suggests that renewed efforts to find a way forwards inclusive of GHG pricing are important to avoid deadlock, as well as to ensure delivery on IMO’s revised strategy commitments 

… said Dr Tristan Smith, Professor of Energy and Transport at UCL Shipping and Oceans Research Group. 

At a glance

• Further technical work is still required, particularly on lifecycle analysis and on the design and governance of the IMO Net Zero Fund, which were already anticipated in earlier workplans.
• There was strong and broad engagement from member states, including developing countries, SIDS and LDCs, with most participants actively discussing revenue collection and distribution mechanisms such as fuel rewards and the Net Zero Fund.
• A large majority of participating countries supported discussions on how revenues should be used, including rewards for zero/near-zero fuels, maritime transition projects, resilience and adaptation for coastal communities, and targeted support for SIDS and LDCs.
• There is growing consensus that the economic elements of the NZF, particularly the Net Zero Fund, are central to its design and implementation.
• The meeting agreed not to advance the multiplier concept further at this stage, while continuing work on reward mechanisms linked to the Net Zero Fund and GHG pricing.
• Member states remain split between an IMO-determined flat-rate reward and a reverse auction approach, with both options carried forward into draft guidelines for further development.
• GHG pricing and revenue use have become increasingly politically sensitive issues, with notable opposition from some states, including the United States, to MARPOL amendments incorporating these mechanisms.

Economic mechanisms and the net zero fund

A key theme of the meeting was strong engagement around the economic elements of the NZF, especially the Net Zero Fund and related revenue collection and distribution mechanisms. A large majority of participating countries actively contributed to these discussions, including many developing countries, Small Island Developing States (SIDS), and Least Developed Countries (LDCs). Only a small minority explicitly avoided engaging on the issue, suggesting broad interest in the financial architecture of the framework.

Strong and continued engagement on the Net Zero Fund underscores broad interest in an economic element within the IMO’s Net Zero Framework, with many countries pushing for accelerated and intersessional work, an indication that such mechanisms remain central 

… commented Dr Annika Frosch, Research Fellow at UCL Shipping and Oceans Research Group. 

Technical design options under consideration

On technical design choices, the group agreed not to advance the “multiplier” concept for now, while continuing to develop options for a zero/near-zero (ZNZ) reward mechanism funded through the Net Zero Fund. Member states were split between preferring a flat IMO-determined reward rate and others supporting further exploration of reverse auctions, or a combination of both approaches, both of which will be carried forward into draft guidelines.

Renewed momentum for a workable pathway

Overall, UCL researchers conclude that despite earlier doubts about the NZF’s future, momentum has returned around finding a workable path forward, particularly one that includes some form of greenhouse gas pricing and financial incentives to support early adopters in shipping’s energy transition.

Dr Marie Fricaudet, Senior Research Fellow at UCL Shipping & Oceans Research Group said: “There remain key questions for further work, on how IMO’s policy could incentivise shipping’s energy transition, particularly how the reward mechanism might support the early adopters – crucial as the pre-cursors to shipping’s mass market transition.”

source : safety4sea