International Regulation Design for Reduction of GHG Emission in Maritime Shipping by Agent-Based Simulation

Abstract

In order to reduce carbon dioxide emissions from international shipping, the International Maritime Organization (IMO) is discussing the future strengthening of EEDI/EEXI and the introduction of subsidies and carbon taxes. However, the stakes in international shipping are so complex that it is difficult for the IMO to predict how regulations will affect shipping companies’ decisions and markets in the future, making it difficult to determine effective regulations.In this study, we develop an agent simulator that simulates the decision-making process of actual shipping companies, and propose a method to quantitatively evaluate the response of international shipping to various regulations, thereby supporting the decision-making process of policy makers. The developed simulator outputs simulation results from 2023 to 2050 when the EEDI/EEXI reduction rate, subsidy rate, and carbon tax rate are input.In this study, we conducted simulations for 100 different regulatory proposals and plotted the results of all the proposals on a scatter plot of total carbon dioxide emissions and total benefits to support the decision making of regulatory decision makers. Furthermore, we were able to support effective regulatory decisions even when the assumptions were that the carbon emission reduction targets set by the IMO would be met and that carbon tax revenues would exceed subsidy expenditures.