Earlier this May, the Directorate General of Shipping released a guidance note to carve out a roadmap for India to comply with Marpol Annex VI adopted this year at MEPC 83. This note explains the key provisions of Marpol Annex VI and aims to build preparedness among the Indian Shipping industry with respect to the upcoming regulations under IMO’s framework. GFI Compliance Adopted at MEPC 83, the Greenhouse Gas Fuel Intensity (GFI) measure is a mechanism to progressively reduce greenhouse gas emissions from ships above 5000 GT. Marpol Annex VI has set specific GFI limits which ships on international voyages must follow or face penalties. The GFI is set to come into force in March 2027. Having considered the three different methods under the GHG pricing mechanism, including a flat levy where ships will be uniformly penalised at $100 per tonne of CO2 emitted; a higher penalty of $150 per tonne of CO2 emitted but the penalty redistributed among different sectors for climate vulnerable countries through the Small Island Developing States (SIDS) proposal; and, the Two-tier GFI mechanism which is a performance linked system penalising ships with high GFIs while rewarding those with GFI below the target levels, the later was adopted through a majority vote at the MEPC 83. The two tier GFI mechanism entails, eligible ships to abide by two levels of targets; a) A Base Target which aims for decarbonisation at 4% by 2028 and 30% by 2035 and b) The Direct Compliance Target aiming at decarbonisation at 17% by 2028 and 43% by 2035. This mechanism levies penalties in the form of ‘remedial units’ for failure to meet the targets. For failing to meet the base target, a higher remedial unit purchase worth $380 per tonne of CO2 is set out while a failure to meet the direct compliance target, ships must purchase remedial units worth $100 per tonne of CO2. Ships which surpass these targets can also generate ‘Surplus Units’, which can be used to trade with other ships in lieu of other benefits; or banked for future use; or even used to qualify for the IMO Net Zero Award. The GFI mechanism also lays down a plan for redistribution of the funds generated through the penalties. These will be held under the IMO Net Zero Fund which can be encashed for financial incentives to well performing ships, assist developing countries in their climate initiatives etc. India’s Position The Note elaborates on India’s position on the GFI mechanism : The flexible pricing mechanism under GFI benefitted India by firstly, reducing the cost impact from $1.5- $2.4 billion annually to under $100 million, compared to a flat levy structure. It incentivises adoption of clean technologies while being well aligned with India’s climate transition strategies. The GFI mechanism however does not impact Indian fleet much. Only 13.9% of Indian ships come under the purview of the GFI mechanism. The GFI mechanism is expected to increase India’s compliance cost by $ 87–100 million annually by 2030 which is well within the industry operating margins. This also promotes synchronisation of India’s projected production capacity of green ammonia and methanol by 2030 with the eligibility criteria of the IMO GFI reward system. This will also boost India’s export potential and investment in clean energy. Action Needed Ships which are eligible under the IMO framework must annually report fuel consumption, voyage data, and carbon intensity metrics through the standardized IMO Data Collection Systems. Aligning ports infrastructure through improved shore power, digital GHG inspection systems, and clean fuel availability to the GFI system will amplify Indian ports’ position as a green bunkering hub. Indian seafarers must have their capacities and awareness built on operational knowledge of GFI reporting, fuel lifecycle characteristics, remedial unit tracking, and voyage planning for emission optimization Indian ships involved in international trade must factor GHG compliance in order to reduce long-term freight inflation risks. While India retains the sovereign right over the enforcement of Marpol Annex VI, as a state party of IMO, it will be under the legal obligation to ensure the eligible ships remain compliant with GFI mechanisms. This will also be advantageous for India from a fiscal standpoint and reinforce India’s influence in shaping global governance of the green shipping landscape.
India and Japan have had a long standing kinship across the realms of business, politics and, art and culture. In the recent times, the maritime sector has emerged has one of the key areas of collaboration between them. From the Free and Open Indo-Pacific (FOIP) vision to the latest high level bilateral meetings between dignitaries from the two countries, India and Japan have fostered a robust relationship in facilitating growth and innovation in the maritime industry. Some of the key milestones in the Indo-Japan maritime strategy are : Free and Open Indo-Pacific Vision, 2020 : Both countries share the vision to nurture the pillars of FOIP in building economic capabilities; improving maritime security and connectivity; promoting sustainable development and collective security. QUAD Framework : As members of the Quadrilateral Security Dialogue (QUAD), India and Japan have mutually committed to strengthening maritime resilience and security through collaborative naval drills, interoperable disaster response mechanisms etc. India- Japan Clean Energy Partnership , 2022 : A strategic initiative launched to jointly promote both countries' decarbonisation efforts through pilot projects as well as research and development projects in green hydrogen and green ammonia-based fuels, carbon recycling technologies etc. The latest highlight in the chain of Indo-Japan maritime ties, is the High-Level Bilateral Meeting held last week at Oslo, Norway between Shri Sarbananda Sonowal, Union Minister of Ports, Shipping and Waterways, India and Mr. Terada Yoshimichi, Japan’s Vice Minister of Land, Infrastructure, Transport & Tourism. The meeting re-affirmed both countries' commitment to mutually boost investment and development of sustainable fuels, digitisation of ports, upskilling and employment opportunities for seafarers among other discussions. Smart Islands : Appreciating Japan's expertise in developing island territories, India invited Japan's cooperation in the quest to transform Lakshadweep and Andaman and Nicobar islands into Smart Islands. Clean Energy Hubs : The Ministers of both the countries discussed greenfield investments like the pilot project, Imabari Shipyard in Andhra Pradesh and the prospects for development of more clean energy hubs jointly between leading Japanese shipbuilding companies and Indian yards. Other infrastructural and economic collaborations : Both countries assessed potential MoUs between relevant Japanese stakeholders and Cochin Shipyard Limited and other Indian maritime educational institutes and public agencies. Further, the feasibility of integrating India's 154000 trained seafarers in Japan's maritime missions was deliberated upon. Finally, Shri Sonowal invited Japan to partner in the development of the National Maritime Heritage Museum in Lothal, Gujarat. India has set a target of five trillion yen as investment from Japan by 2027 and the high-level meeting evinced substantial and sustainable progress in the bilateral maritime ties between India and Japan going forward. This meeting comes at an opportune moment in the wake of the World Hydrogen Asia Conference scheduled between July 8th and July 10th, 2025 at Tokyo, Japan. As supporting partners to the conference, GH2 India will be steering insightful discussions and follow ups on securing Asia's sustainable future with hydrogen and low carbon fuels.
State-wise distribution of green hydrogen incentive support in India (CEEW, 2025)
Government-backed initiative to deploy 37 hydrogen-powered vehicles
Green hydrogen is seen as the fuel of the future. It seems so simple – just plug in your electrolyser to a solar panel, just as you plug in your iPhone to the charger, and get emission-free clean hydrogen. Blue hydrogen (produced from gas and capturing the carbon-dioxide) seems clearly not as clean – emissions throughout the entire process. I find it utterly fascinating – how and what can we do to reduce GHG emissions and decarbonize our economies? Unfortunately, the more I read, the more new and contradictory information I become aware of. This op-ed focuses just on the issue of emissions related to hydrogen production, leaving many other issues to another day, foremost my favourite topic technology developments and break-throughs. Do electrolyers and renewable energy go well together ? How do electrolysers, designed for stable current, perform when subjected to intermittent electricity flow, as is supplied by renewable energy? A study was recently published of 130 publications covering the impacts of intermittent operation on alkaline and PEM electrolyzers from the year 2000–2023. (“Impacts of intermittency on low-temperature electrolysis technologies: A comprehensive review Emma Nguyen, Pierre Olivier, Marie-Cecile Pera, Elodie Pahon, Robin Roche”). The review encompassed issues related to efficiency, gas quality and durability arising at all operational scales, from the cell to the system level. The key points from reviewed publications can be summarized as follows: i) “performance and durability of electrolyzers at all levels of the system operation, are significantly influenced by the variation of temperature and electrical load conditions, ii) both the performance and durability of electrolyzers are impacted by the frequency of intermittent cycles during intermittent operation, iii) short current interruption or decrease promote partial performance recovery, iv) the stiffness of ramp-up and ramp-down events typically encountered in intermittent operation has an impact on the efficiency, gas purity and degradation rate, v) the frequency and waveform of ripple factors encountered in power conversion units impact the efficiency and degradation rate of electrolyzers.” This is immensely technical. What it boils down to is electrolysers do not perform as well with constant fluctuations, and degrade quicker, meaning cost projections can potentially be too optimistic. One of the less obvious, but just as relevant issues is gas purity. This is confirmed by a study on “Comparing prospective hydrogen pathways with conventional fuels and grid electricity in India through well-to-tank assessment” (Sachin Chugh*, Chinmay Chaudhari, Alok Sharma, G.S. Kapur, S.S.V. Ramakumar of Indian Oil Corporation Limited, Research and Development Centre) came up with an estimate of 2.1%-5.65% total H2 loss only in production due to venting, hydrogen crossover, and purging to remove impurities. My sense electrolyser manufacturers know these issues, and are working tirelessly to improve the performance. Who is the cleanest hydrogen of them all …. ? If Snow White were to look into the mirror, and ask - ´who is the cleanest hydrogen of them all?´, the answer would probably differ according to where the mirror stands. Europe would clearly say green, the USA would possibly allow for low carbon (blue) hydrogen, South Korea and Japan have noticeably tried to avoid the debate. As India tries to position itself, there were some amazing developments and articles in the last 4 weeks that caught my attention. “ In its Climate Issue of June 24th , The Economist pointed out the solar-power paradox – “Solar panels are bought because they are cheap, and mostly from China. But polysilicon, the raw material for solar panels that quietly generate electricity for 20-30 years without emitting any carbon whatsoever, is often made using coal, the most emissions-intensive fuel of all. Hopefully, this is an interim phase only, and once the price is right, solar panels will generate the electricity to melt the sand using the endless flux of photons from the sky, creating material for new, cheaper solar panels, which will be used in ever more surprising ways”. Another study was released in the Netherlands reviewing the GHG effects of green hydrogen (Worldwide greenhouse gas emissions of green hydrogen production and transport, Kiane de Kleijne, Mark A. J. Huijbregts, Florian Knobloch, Rosalie van Zelm, Jelle P. Hilbers, Heleen de Coninck & Steef V. Hanssen ) The study reviews the life-cycle greenhouse gas emissions for 1,025 planned green hydrogen facilities, covering different electrolyser technologies and renewable electricity sources in 72 countries. “We demonstrate that the current exclusion of life-cycle emissions of renewables, component manufacturing and hydrogen leakage in regulations gives a false impression that green hydrogen can easily meet emission thresholds. Evaluating different hydrogen production configurations, we find median production emissions in the most optimistic configuration of 2.9 kg CO2 equivalents (CO2e) kg H2−1 (0.8–4.6 kgCO2e kg H2−1, 95% confidence interval). Including 1,000 km transport via pipeline or liquid hydrogen shipping adds another 1.5 or 1.8 kgCO2e kg H2−1, respectively. We conclude that achieving low-emission green hydrogen at scale requires well-chosen production configurations with substantial emission reductions along the supply chain.” Blue hydrogen gets promoted as low-carbon hydrogen, and as the solution in the short-term. But is it really “low-carbon”? A report from the UK organisation Carbontracker.org comes to quite a different conclusion (https://carbontracker.org/reports/kind-of-blue/ ). This report evaluates the impact of upstream emissions to determine whether or not gas-based CCUS technologies could have a positive climate impact, assuming the technology would work as claimed by the CCUS industry. The report reveals that CO2 emissions from Blue Hydrogen and Gas-CCS projects could be two to three times (200-300%) higher than reported when considering upstream emissions from gas extraction, processing and transport. Due to their specific geographic location, Japan and South Korea have greatly promoted hydrogen and ammonia, and to a degree overlooking nuances in production type. But as Argus Media reported, South Korea in a recent auction on May 24th set parameters for eligible bidders that are likely to favour carbon capture-based low-carbon ammonia projects over those produced with renewable hydrogen via electrolysis. But most notably, the government has outlined that any CCS projects will need to capture 90pc of carbon emitted in order to qualify for the bidding market. The 90pc threshold will exclude several low-carbon ammonia production projects that operate on steam methane reforming (SMR). (Retrofitted CCS capabilities on SMR plants typically are unable to capture more than 50pc of carbon emitted, while newbuild CCS SMR plants may be capable of capture rates of around 70-95pc). At least some good news about not forgetting low-carbon hydrogen is but one of the instruments towards decarbonization ! Hopefully, these articles / studies will remind policy makers to look into and include the scope 3 emissions in the standards.
