Maharani Putri, Nisrina Putri Fauzi, Gadjah Mada University, Yogyakarta

Indonesia is a fairly large archipelagic country, which controls 3 archipelagic sea lanes (Indonesian Archipelagic Sea Lanes/ALKI) for the benefit of the world’s maritime industry. As an archipelagic country, it possesses promising maritime potential given the abundant natural resources in the ocean. The maritime industry is quite prominent, especially in several sectors, such as logistics, transportation and ports, shipping, oil and gas, fisheries, and so forth. However, the large activity in this industry shows that Indonesia has a significant contribution to total national emissions.

A significant part of the maritime industry is the shipping sector, which is vital in raising national emissions. According to Law No. 17 of 2008 on Shipping, this industry encompasses three categories: sea transportation, river and lake transportation, and ferry transportation. Maritime transportation has an important part in the national economy, particularly in export and import activities. Nearly 90% of international trade in Indonesia is conducted by sea. Therefore, to advance the sustainable maritime industry aligns with the blue economy concept, this sector must integrate environmental aspects into its operations, one of which involves efforts to reduce emissions.

Since 80% of global transportation occurs in the marine area, the amount of pollution has been affecting the ecosystem, concerning health and environmental matters. Maritime transportation contributes 2.5% of the global greenhouse gas budget, which is expected to increase by 50%-250% by 2050. These factors drive increased greenhouse emissions that contribute to global warming and climate change, which ultimately endanger humans and various life on planet earth.

Technically, environmental problems can arise when fuel combustion occurs in the main engines and auxiliary engines of ships, leading to greater levels of pollutants. Fuel consumption at elevated levels leads to higher emissions, necessitating the implementation of efficiency and optimization strategies. To operate these ships, they commonly rely on fuels like HFO (Heavy Fuel Oil) or MDO (Mercury Diesel Oil), which, according to many studies, have been proven to raise emissions at sea. Therefore, alternative fuels with lower emissions are needed to reduce the negative impact of the maritime transportation industry in Indonesia, for example, by using LNG (Liquefied Natural Gas), hydrogen, or biofuel. 

Arguably, these emissions constitute an environmental cost not reflected in fuel prices. As an external burden in fuel consumption, a specific mechanism is needed to internalize these expenses so that polluters can pay according to the impact of their emissions, such as via a carbon pricing mechanism. Nevertheless, regulations regarding this matter in Indonesia are still not fully developed and require further attention.

The need to internalize environmental costs and ensure polluters pay underpins the multilayered global regulatory framework for decarbonizing international shipping, which operates at both universal and sector-specific levels. At the universal level, the United Nations calls for urgent and coordinated action to address climate change and its harmful impacts, as reflected in the core objective of Sustainable Development Goal 13. Building on this mandate, Parties to the United Nations Framework Convention on Climate Change (UNFCCC) adopted the Paris Agreement in 2015 which sets the overarching obligation for the international community to limit global temperature rise to 1.5°C above pre-industrial levels. According to the 2023 Sustainable Development Report, global temperatures are likely to pass 1.5°C by 2035 and could reach 2.5°C by 2100. This projection reinforces the need for countries to pursue substantial and accelerated GHG reductions of 43% by 2030 and to achieve net-zero emissions by 2050. To operationalize this long-term ambition, the Paris Agreement employs a five-year cycle through which states submit progressively more ambitious Nationally Determined Contributions (NDCs).

Applying global climate targets to the shipping sector provides a context to understand its contribution to overall emissions. In 2018, the global carbon dioxide (CO2) emissions from international shipping amounted to 1.06 gigatons, constituting nearly 2.9% of global anthropogenic CO2 emissions. To address this, the IMO has developed a comprehensive framework aimed at enhancing ship energy efficiency and reducing GHG emissions. A key milestone was the adoption of Resolution MEPC.203(62) in 2011, which amended MARPOL Annex VI to introduce mandatory technical and operational measures, including the Energy Efficiency Design Index (EEDI) for new ships and the Ship Energy Efficiency Management Plan (SEEMP), providing technical and operational tools to improve ship performance. 

In 2018, the IMO’s Marine Environment Protection Committee (MEPC 72) adopted the Initial Strategy for the Reduction of GHG Emissions from Ships, marking the first collective commitment by the maritime sector to decarbonize international shipping. The strategy establishes objectives, guiding principles, tools, and a work plan to reduce the carbon intensity of ships by at least 40% by 2030 and 70% by 2050, relative to 2008 levels, while also targeting a minimum 50% reduction in total annual GHG emissions by 2050. To achieve these targets, it emphasizes adherence to the EEDI for new vessels and encourages operational measures to enhance efficiency across the global fleet. Subsequently, Resolution MEPC.328(76) in 2021 established the Energy Efficiency Existing Ship Index (EEXI) and the Carbon Intensity Indicator (CII). These measures provide a practical framework to implement the strategy’s objectives and monitor the performance of both new and existing ships.

The cornerstone of this framework is the 2023 IMO Revised Strategy on the Reduction of GHG Emissions from Ships, which represents a significant shift from earlier commitments by adopting a much more ambitious climate pathway. It encourages the adoption of zero and near-zero emission technologies, fuels, and energy sources, with a minimum target of 5% by 2030 and an aspirational target of 10%. The ultimate goal is for GHG emissions from international shipping to reach net zero. To monitor progress, the strategy introduces a series of interim checkpoints: the first aims to reduce annual GHG emissions by at least 20% by 2030, with an aspirational target of 30%, relative to 2008 levels, while the second checkpoint targets a 70% reduction by 2040, aspiring toward 80%, also compared to 2008 levels. It is important to note that the IMO uses 2008 as the reference year for all its future regulations on reducing carbon intensity and greenhouse gas emissions from ships. Overall, these progressive measures collectively provide a structured pathway for the maritime sector to align with global climate objectives and track its emissions reduction over time.

To implement a net-zero shipping framework, states, international stakeholders, and decision-makers must develop a strong environmental awareness and commitment. Indonesia’s commitment to reducing emissions aligns with its National Determined Contribution (NDC) to the Paris Agreement, which aims to achieve decarbonization in its long-term plan by reducing CO2 by 2030 and achieving net-zero emissions within 2060 or sooner. Other than ratifying several international frameworks and agreements, Indonesia already has several regulations aimed at controlling emissions arising from maritime activities.

In line with existing regulations, Indonesia’s commitment to reducing emissions is also manifested in its strategy to implement “green shipping” and “green ports” in its maritime activities. Both of these concepts have been gradually implemented in Indonesia, though they have not been put into practice in all areas. Furthermore, in its mission to reduce fuel emissions from passing ships, the government has also developed several strategies, such as mandating the use of low-sulfur fuel, the use of scrubbers to clean the ship’s exhaust gases, as well as reporting fuel consumption of Indonesian-flagged vessels for emission monitoring. If all stakeholders can synergize with international organizations, the shipping industry, and also the community, achieving sustainable maritime transport can be accomplished sooner or later. 

Indonesia, as a major maritime crossroads of global shipping traffic, is expected to experience significant impacts from the IMO’s net-zero emissions strategy. In principle, Indonesia is well-positioned to align with this global pathway, given its existing regulatory foundation encompassing energy-efficiency rules, emission-control requirements, pollution-prevention standards, and carbon economic value mechanisms. Institutionally, the government is preparing a National GHG Emission Reduction Roadmap for the maritime sector, which includes the development of an emissions inventory and methodological guidelines for calculating ship-based GHG emissions. Additionally, one of the sector-specific initiatives is the decarbonization strategy for international ship exhaust gases passing through the ALKI, which involves measuring emissions from transiting vessels, promoting low-carbon fuels, and coordinating compliance with IMO guidelines, to transition ALKI toward a carbon-neutral corridor by 2050.

Despite this progress, several structural challenges persist, namely the need for substantial capital investment, the limited alternative green fuels, and the difficulty in securing affordable and sustainable energy supplies. These constraints indicate that Indonesia must overcome significant transitional barriers before fully realizing the benefits of low-carbon maritime development. On the other hand, the green transition also creates positive opportunities. It is expected to drive shifts in business orientation and, in many cases, stimulate increased research and development across various sectors, including maritime technology, fuel innovation, and port operations. In addition, the country’s considerable renewable energy potential, including solar, wind, ocean energy, biomass, geothermal, and hydropower, offers long-term opportunities to diversify the maritime energy mix and foster innovation across industry practices.

Indonesia is capable of achieving the IMO’s net-zero emissions targets, provided it proactively enhances its domestic regulatory framework and strategically leverages its unique maritime resources for a net-zero emission transition. The central task lies in harmonizing domestic regulations with the amended provisions of MARPOL Annex VI. This will necessitate updating national technical standards, enhancing port state control mechanisms, and ensuring coherence between domestic policies and the IMO’s decarbonization targets. In addition, economic adjustments, regulatory reforms, and environmental obligations from the IMO’s net-zero framework are likely to generate significant implications for Indonesia. As the maritime sector adapts to these evolving requirements, Indonesia will also need to strengthen its institutional capacity to ensure effective implementation and long-term policy continuity. Achieving an effective transition will ultimately depend on coordinated national planning, strengthened regional cooperation, and sustained investment in low-carbon technologies.

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