Japan has proposed less stringent greenhouse gas fuel intensity (GFI) reduction targets from 2030 onwards and suggested removing the IMO Net-Zero Fund, instead opting for a "direct contribution" mechanism. This comes as part of Japan's submission to the International Maritime Organization’s Marine Environment Protection Committee (MEPC 85), which seeks to balance shipping industry ambitions with operational realities.

Proposed Changes

In accordance with Hellenic Shipping News, Japan’s proposal would ease the GFI targets starting from 2030. The base target for 2030 is proposed to be relaxed from 85.84 grams of CO2-equivalent per megajoule (gCO2e/MJ) to 86.8 gCO2e/MJ, and the direct compliance target should ease to 74.6 gCO2e/MJ in 2030, instead of 73.71 gCO2e/MJ. For 2035, the targets are proposed as 60.7 gCO2e/MJ for the direct compliance target and 72.9 gCO2e/MJ for the base target, compared to the current draft’s 53.18 gCO2e/MJ and 65.31 gCO2e/MJ, respectively.

Japan also suggests a flat direct compliance target of 72.9 gCO2e/MJ from 2028 to 2035, which is stricter than the current draft’s targets through 2030 and less aggressive from 2031 onwards. The proposal includes removing the fixed GFI reduction factors for 2040, with the Committee setting them by 2032 based on the global availability of new fuels and technologies.

According to Ship & Bunker, Japan’s approach aims to address concerns about rapid changes affecting the existing fleet. The submission maintains a two-tier GFI standard but lowers reduction factors, proposing a 7% base target in 2030 that increases to 21.9% by 2035. For direct compliance, it sets targets at 21% in 2030 and 43% in 2035.

Alternative Mechanisms

The proposal seeks to remove the Net-Zero Fund entirely, allowing ships to balance their compliance deficits through low-emission fuels or surplus units. Those unable to meet targets can make direct contributions to approved projects, which could support particular new fuels or technologies.

In a bid for compromise, Japan’s submission aims to find achievable GFI targets based on the replacement speed of existing fleets, using a performance-based approach rather than forcing rapid changes like early ship replacements and major conversions.