SOME of the world’s largest shipping companies have voiced their “grave concerns” with the International Maritime Organization’s Net-Zero Framework, saying the flaws in the regulation are so fundamental that they will not be able to be fixed post-adoption.

In a joint statement, the ad hoc group of 15 shipowners said that it wanted “to ensure that the voice of the industry is heard and appreciated by decision-makers.”

The signatories, including the Angelicoussis Group, Bahri, Capital Group, Frontline, GasLog, Hanwha Shipping, George Prokopiou companies, Stolt Tankers and George Economou’s TMS Group, as well as others, span more than 1,200 ships and 150m dwt of shipping capacity.

They said that global measures to curb the industry’s greenhouse gas emissions should be “fit-for-purpose, incentivising available transition options and providing the market with the right signals to enable decarbonisation of the maritime sector”.

In addition, measures should not heap “excessive” financial burdens on the market or result in “inflationary pressure” on end-consumers.

“As it stands, we do not believe the IMO NZF will serve effectively in support of decarbonising the maritime industry as per the IMO2023 strategy, nor ensure a level-playing field as intended,” the group said.

Among the group’s criticism were that the framework lacked a comprehensive impact assessment and “interim fuel availability checkpoints similar to previous fuel change regulations like IMO2020”.

Proposed fuel-intensity trajectories were “more than 10 years ahead of the current FuelEU framework”.

In view of the time needed for global infrastructure and supply chains to adapt, and for the maritime industry to develop the required vessels, such accelerated, steep trajectories did not “serve the transition,” the group argued.

Instead, the framework demanded “an abrupt switch towards only rewarding emerging technologies that have not been fully developed, nor fully assessed on safety”.

The statement said that the business case for “tangible transition fuels” such as biofuels and liquefied natural gas had been “neglected”, and reducing incentives for investment in LNG solutions “eliminated” a future decarbonisation pathway making use of bio- and synthetic-methane/LNG.

“Failing to incentivise investment in known and available transition technologies with established standards, and focusing only on unproven ZNZ (zero-or-near-zero) solutions, will result in the majority of shipping shifting towards pay-to-emit operations,” the owners argued.

Small- and medium-sized companies, especially those operating in the tramping segment of shipping, would be “disproportionately” burdened.

While some of the signatories also have containerships, all are predominantly active in the tanker, gas carrier and dry bulk trades.

The statement also cast the IMO’s proposed framework as wildly unrealistic, noting that shipping today consumes about 3% of global energy.

To meet 2040 targets under the current proposals, the industry would require about 50% of expected global production of low-carbon hydrogen intended to serve all industries, it said.

In addition, the signatories said that the proposals would raise $20bn-$30bn annually by 2030 but could “quickly” accumulate more than $300bn by 2035 if the global fleet lags targets “by as little as 10%”.

The group also criticised what it claimed was a lack of clarity on governance, and use of the funds, particularly in terms of incentivising “known” alternative fuels and efficiency improvements.

The statement is virtually unprecedented in forcefully representing the views of such a collection of major international shipowners towards a piece of legislation.

In a fragmented industry where everyone has their own opinion, lobbying has almost always been done exclusively through national and international industry associations.

The move follows a previous highly critical statement in April following the stitching together of the IMO’s compromise framework.

However, that was issued by the Angelicoussis Group with half-a-dozen companies supporting it, all of them based in Greece. That, too, was supported by GasLog, one of the Prokopiou companies, and TMS.

The roster of signatories to this week’s statement, which probably represents only the tip of the iceberg in terms of industry support, reflects how much the immediate euphoria in the wake of the April IMO deal has now soured.

So far the International Chamber of Shipping, which represents shipowners worldwide, has backed adoption of the framework with the intention of arguing for substantial improvements during the implementation phase where guidelines will be eked out over the following 16 months.

However, the major owners behind this week’s statement have effectively thrown down the gauntlet to this approach.

“These fundamental issues cannot be resolved by emerging guidelines post-adoption,” they underlined.

“We believe that critical amendments to the IMO NZF are needed, including the consideration of realistic trajectories, surplus and reward allocation in support of transition and SMEs, with transparency on fund governance, before adoption can be considered.

“Collectively, we have made substantial financial investments to improve the efficiency and carbon footprint of our existing fleets, in addition to ordering state-of-the-art vessels,” the statement added.

“It is crucial that we are incentivised in continuing to do so while ensuring safe, reliable, and competitive operations.”

Next month’s key Marine Environment Protection Committee meeting at the IMO is scheduled to host what has been cast as a binary yes or no vote to adopt the framework or not, rather than reopening discussion of the contents.