New International Agreement Targets Shipping Emissions with Fees

On April 11, 2025, a significant agreement was reached among nations aiming to tackle climate pollution from the shipping sector, which is responsible for about 3% of global greenhouse gas emissions. Held in London under the guidance of the International Maritime Organization (IMO), the draft agreement mandates that cargo ships reduce their emissions or face a fee. Despite falling short of initial expectations, this landmark accord is set to be the first of its kind requiring a global industry to account for its climate impact, with funds generated from the fees largely directed towards transitioning to cleaner fuels.

The agreement applies universally to all cargo vessels, regardless of their flag, including U.S.-registered ships, and is anticipated to come into effect by 2028, subject to further approval. Notably, the pact was finalized even as the United States withdrew from discussions earlier that week, underscoring the resilience of international collaboration, as highlighted by advocates for maritime and environmental reform. This initiative marks a pivotal turn where the shipping industry is compelled to decarbonize and explore alternative energy sources in response to escalating climate concerns.