Surplus Unit Cancellation as a Mitigation Contribution

A mitigation contribution is the end state of a surplus unit that is never used against another ship’s Tier 2 deficit under the draft IMO Net-Zero Framework. Draft regulation 36.12.3 of MARPOL Annex VI Chapter 5 (MEPC/ES.2/2) lets a ship voluntarily cancel a surplus unit “as a mitigation contribution”, and regulation 36.15 has the IMO GFI Registry cancel any surplus unit not used within two calendar years following the calendar year of its issuance on the same basis.

Surplus units are earned by ships at or below the direct compliance target . Cancellation removes them from use, so the emissions reduction they represent is not used to offset another ship’s deficit. The full article will cover the Registry procedure under regulation 38.4.4 and how cancelled units are reported under regulation 38.9.