Posted: February 11th, 2025

Comparative Analysis of Technological and Policy Options for Decarbonization Pathways

Comparative Analysis of Technological and Policy Options for Decarbonization Pathways in the Shipping Sector by Region

Factor in that the shipping industry is a major player in global commerce, carrying nearly 80% of goods by volume over international waters. This sector, while accounting for nearly 3% of the global total of greenhouse gas emissions, is projected to increase in contribution without intervention (IMO, 2023). It is in recognition of that challenge that the International Maritime Organization (IMO) made bold commitments in 2018 to cut shipping emissions at least 50% before 2050, relative to 2008 levels. This key challenge can only be tackled by a mix of technology developments and strong policy frameworks. Global implementation of these measures is challenged by region-specific issues based on economic priorities, the availability of infrastructure, and the capacity of regulators. We review decarbonization pathways for the shipping sector across the globe, assessing technology pathways and policies in major regulatory regimes, emphasizing the role of International Maritime Organization (IMO) policymaking with regional and global implications.
Technological Options for Decarbonisation
Emerging technology is the great green hope of shipping decarbonization. Several approaches have been proposed as leading candidates, each with trade-offs.
Alternative Fuels Are at the Forefront of Decarbonization LNG approximately a 20% reduction in carbon dioxide emissions compared to to the previous heavy fuel oil used with transition energy already on the market in Northern Europe (DNV, 2022). Both hydrogen and ammonia, zero-emission fuels when sustainably produced, have long-range potential. As an example, Japan has been heavily investing in hydrogen ships, and pilot projects have been running since 2020 (Tanaka et al., 2023). But scalability is hampered by high production costs and a limited bunkering infrastructure.

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Advances in energy efficiency technologies present another path. To combat these issues, ships are retrofitted with wind-assisted propulsion systems (e.g. rotor sails) which have the potential to reduce fuel use by 5-20% (Smith & Jones, 2021). Similarly, hull optimization and air lubrication systems improve vessel performance at lower emissions levels with no fuel transition needed. These capabilities are well suited to older fleets and much of the developing world, such as Southeast Asia, where replacing vessels is financially unrealistic for operators.
Hence electrification is a revolutionizing option for short sea shipping. Battery powered ferries, operational since 2018 in Scandinavia, do not emit direct emissions and are plugged into renewable energy grids (IMO, 2023). Still, limitations on battery range and high capital costs keep them relegated to coastal routes and deep-sea shipping reliant on alternative modes.
All the technological options need huge investments and infrastructure augmentations. As a result, the solution that is implemented often is tied to local resources, local economy, or both, highlighting the need for customized policy support to incentivize adoption.
International Policy Framework and IMO Regulations
The IMO, with its adoption of an Initial GHG Strategy in 2018, provides the overarching regulatory framework for shipping decarbonization. Under this framework, a 40 percent carbon intensity reduction is required by 2030 and an absolute emissions cut of 50 percent by 2050 (IMO, 2023). The EEDI applies to new build tonnage, while the CII applies to all existing vessels and represents the first global framework to address these key measures since their enforcement in 2023 onwards. Such rules require shipowners to either achieve greater operational efficiency, or to use cleaner fuels, or face penalties or lack of access to some ports.

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