The International Maritime Organization officially approved a new global decarbonization standard for shipping Friday, centered on a carbon credit system.
After a week of intense negotiations in London, delegates settled on a fuel standard as the core mechanism, leaving out a formal levy on the industry.
The deal also introduces new sanctions-enforced greenhouse gas intensity reduction targets, set to tighten each year through 2035.
Under the agreed credit trading scheme, vessels with lower emissions will be able to generate credits to sell to owners of higher-polluting ships. Those that fail to comply with the fuel standard will face financial penalties, with proceeds funneled into a central fund managed by the IMO.
