New analysis shows only one of the four Net Zero Framework policy options on the table can meet IMO’s 2030 and 2040 targets

nrehmatulla
7 days ago
3 min read

Updated: 6 days ago

Independent modelling shows sharply different cost and emissions outcomes across the four amendment options now on the table for the Net-Zero Framework

London, 06 August 2026 - New analysis submitted to the International Maritime Organization (IMO) by IMarEST ahead of the 22nd Intersessional Working Group on GHG Emissions from Ships (ISWG-GHG 22, 1–4 September 2026) finds that of the four candidate amendments to MARPOL Annex VI, only the ‘NZF as a levy’ can meet the 2030 and 2040 emissions checkpoints in the IMO's 2023 GHG Strategy.

The analysis, submitted by IMarEST in ISWG GHG 22/2/2 and drawing on modelling by the UCL Energy Institute's Shipping and Oceans Research Group and Rocky Mountain Institute, compares the four options put forward in Circular letters 5213–5216 since MEPC 84 asked member states to keep working on outstanding concerns with the Net-Zero Framework (NZF). It is the first study to model the specific terms of all four proposals side by side, building on the assumptions and methods used in the IMO's own Comprehensive Impact Assessment of mid-term measures (MEPC 82-INF.8-Add.1).

"This is the first study to model the specifics of all four proposals side-by-side, building on the assumptions and methods used in the IMO's own Comprehensive Impact Assessment of mid-term measures. As negotiations intensify ahead of MEPC 85 at the end of the year, we are hopeful our analysis will help guide IMO member states to a workable solution for the Net Zero Framework.” said Dr Tristan Smith, Tristan Smith, Professor of Energy and Transport at UCL’s Energy Institute

Key findings:

Emissions: The "NZF as levy" option delivers the steepest cuts, bringing cumulative emissions close to the IMO Strategy's trajectory. "NZF as is" falls short of the 2030/2040 checkpoints but outperforms the "softer start, harder finish" variant, which consistently produces higher cumulative emissions despite a steeper GFI curve after 2040. The fourth option, a "fundamental redesign" of the Annex VI amendments with no GHG pricing element, is the weakest performer and is unlikely to come close to the Strategy's objectives.
Cost of compliance: "NZF as is" offers the lowest average carbon abatement cost of the three pricing-based options, provided any rise in biofuel prices doesn't happen before 2038. All four options converge on broadly similar transport cost increases by mid-century — roughly 70–80% higher by 2050 regardless of which is adopted — consistent with the IMO's own Comprehensive Impact Assessment.
Revenue for the Net Zero Fund: "NZF as levy" raises more than $100bn a year through the 2030s, versus roughly $12bn a year under "NZF as is" — a near nine-fold difference — while the "fundamental redesign" option raises no revenue at all, since it contains no GHG pricing mechanism. "As levy" also front-loads its cost impact, pushing transport costs up by around 80% as early as 2029.
Compliance price risk: Under the "fundamental redesign" option, the model finds no ceiling on the compliance price ships could face if fuel supply fails to keep pace with demand — unlike the other three options, which include a Tier 2 price cap that acts as a relief valve.

The findings are intended to support delegations, including those from developing states and small island states, as they weigh the trade-offs between emissions performance, cost impact and revenue for a just and equitable transition ahead of decisions expected at MEPC 85/ES.2.

The modelling updates and extends the approach used in the IMO's Comprehensive Impact Assessment of mid-term measures (MEPC 82-INF.8-Add.1, DNV), applying it to the specific terms of all four Circulars for the first time. It incorporates newer research on shipowner investment decision-making under uncertain Surplus Unit pricing, described in a forthcoming peer-reviewed paper. Source code is available on request. Full results, including a sensitivity analysis on fuel-availability assumptions, are set out in the submission to ISWG-GHG 22.

Cumulative emissions arising from the different policy architectures