WSC proposes Green Balance Mechanism to accelerate transition to Net-Zero

GLOBAL – The World Shipping Council (WSC) has unveiled an updated proposal for the Green Balance Mechanism, aimed at helping the shipping industry meet its net-zero emissions target by 2050.

The proposal, submitted ahead of the IMO ISWG-GHG 17 and MEPC 82 meetings, includes detailed design updates and regulatory text to support the creation of effective climate regulations for shipping.

The Green Balance Mechanism is designed to make green fuels more competitive with fossil fuels by addressing the high cost and limited availability of these fuels.

Ships that run on green fuels are already in operation, and over 60% of new container and vehicle carrier vessels scheduled for delivery by 2030 will be equipped to use them. However, the cost disparity between green and fossil fuels remains a significant challenge.

Joe Kramek, President & CEO of the WSC, emphasized the urgency of adopting this mechanism. “For shipping’s energy transition to take place, green maritime fuels must be available at scale. This requires substantial investments from energy producers, and for these investments to be realized, IMO regulations must make green fuels a viable alternative. Without such regulations, the market for green fuels will not develop sufficiently to stimulate needed investments.”

How the Green Balance Mechanism works

The Green Balance Mechanism is integrated with a greenhouse gas fuel-intensity standard. It imposes a fee on fossil fuels and redistributes these funds to green fuels, making their costs more competitive.

The funds allocation is adjusted annually based on green fuel use and market prices. This approach encourages the use of fuels that deliver significant greenhouse gas reductions and supports continued investment in the cleanest technologies.

“The mechanism includes a framework to create an IMO Net-Zero Fund to support research and development, as well as climate mitigation projects,” Kramek added.

“It’s crucial for IMO member states to adopt these robust regulations by 2025 to achieve net-zero emissions by 2050.”

WSC report highlights drop in containers lost at sea

In related news, the WSC’s annual report on containers lost at sea has shown a significant decrease, with 221 containers lost in 2023, down from 661 in 2022.

This represents the lowest number of lost containers recorded since the survey began in 2008. Despite this progress, WSC CEO John Butler stresses that continued vigilance is essential.

“Every container lost at sea poses a risk, and our commitment to improving safety must remain strong,” Butler said. The report reveals that about 33% of lost containers were recovered and highlights ongoing and upcoming initiatives aimed at enhancing safety.

The WSC is actively involved in initiatives such as the Marin TopTier Joint Industry Project and new mandatory reporting requirements for lost containers, effective January 1, 2026. These measures aim to improve navigational safety and environmental protection.

“Although we’ve made strides in reducing container losses, there is always more work to be done. Our focus remains on preventing these incidents and ensuring the secure transport of containers,” Butler concluded.

With the introduction of the Green Balance Mechanism and ongoing safety enhancements, the WSC underscores its commitment to advancing both environmental and operational standards in the shipping industry.

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