How credible is sustainable shipping?
It has been observed many times decarbonising an industry that transports the world’s fossil fuels presents something of a contradiction. Yes, shipping is efficient at what it does – almost too efficient – but with global carbon emissions equivalent to Germany, it has to change too.
The challenges of change were under consideration during the London International Shipping Week which saw the great and good assemble to pretty much ask the same questions of the same people.
Tradewinds editor Julian Bray asked Mette Asmussen, Lead for Maritime Sector Initiatives at The World Economic Forum if she thought the new IMO target of net zero carbon by 2050 was realistic. Asmussen agreed the industry itself needs to be sustainable but hoped 2050 was not beyond the industry’s ability.
“This is the decade of change; sustainability is a lot of things but its systematic change. The change is the long term goal 2050 what actions we take now how we get there while still being the backbone of global trade,” she said.
MSC is a shipping company that emits 33m tonnes of CO2 annually and has scope three emissions of 7m tonnes. Bud Darr, EVP, Maritime Policy and Government Affairs gave a typically upbeat assessment, calling sustainability “the combination of art and science, finding balance between a viable business and meeting society’s expectations”.
The shipping industry “will do what our customers ask, they reflect society” and said some companies were doing so without regulation. “Regulations will be about pace and the options available,” he added.
Sophie Parker, Transport Economist, The World Bank, agreed; maritime decarbonisation should meet the needs of the population without compromising the future. “In maritime there are so may different perspectives and issues but others won’t matter if we don’t solve climate change,” she pointed out.
For bulk carrier operator Oldendorff Carriers, sustainable business means bringing sustainability principles into daily business decisions according to Christopher Fee. “For us decarbonising the fleet is bringing the crew into the discussions. When we joined the UN Just Transition Taskforce our point to them was don’t forget the crew – they need to be part of the process,” he said.
The catalyst for conversations all week was the ‘game-changing’ IMO MEPC 80 meeting which set admittedly loose targets for decarbonisation with equally non-specific way markers.
Generously viewed as a multi-lateral compromise there is nonetheless guarded optimism that the results provide clear enough direction to reinforce the sustainability business case for enough stakeholders in the industry.
Bud Darr remarked that “the people talking it down have no experience of decarbonising a shipping company or how diplomacy works.” In particular shipping’s carbon emissions by themselves don’t drive national policy positions.
“They got the big ticket right. Yes 2050 is an arbitrary date but we’ve been saying it for two years. In between there are indicative benchmarks which are not bad guesses for pushing technology. It’s what you do between now and then that matters,” he said.
Chris Fee called MEPC80 ‘progressive’. “We were in limbo before, now we have a clear signal, the next step is to agree on lifecycle carbon factors and align them. That is another challenge to our way of thinking,” he said.
Mette Asmussen agreed that the combination of the industry’s public position and regulatory momentum had a successful outcome. “In our work we bring stakeholders together – owners, operators, fuel suppliers and others. The MEPC outcome was positive, it gives us some certainty and much more room for industry action.”
Whether industry spends that momentum wisely will be the next key step. Asmussen believes the demand for new fuels is moving the supply side “all the way from off takers to shipowners; that creates certainty that if they produce fuel, there will be uptake”.
Of course which fuel, when, where and for how much, is one of the issues few can agree about, though since there is so little available the arguments are almost rhetorical.
For Oldendorff its decisions depend on whether it owns the vessels concerned and for these, Chris Fee said the company is optimistic about the potential of methanol. “The engines exist, the fuel exists, it is proven in service and you can use fuels with existing infra. Our challenge is that operating mostly in the tramp trade, we need to make sure the fuels available where we need them,” he said.
MSC has a huge 100-ship newbuilding programme, nearly all with an ‘LNG-ready’ notation and Bud Darr thinks 70-80 will be delivered as dual-fuel LNG-capable. But the company is looking at technology readiness and fuel availability and thinks existing ships are good candidates for retrofit to methanol.
Fuels like LNG can drive marginal improvements in carbon emissions but the easier win is energy and operational efficiency, according to Sophie Parker.
“There is a lot we can do now, not just with technology but on the operational side, which often gets forgotten, in particular port optimisation and just in time arrival,” she said. Port waiting emissions are a huge proportion of the total and she said the evidence from pilot studies is clear.
“The pilot at the Port of Rotterdam showed that optimising port entry in the last 12 hours saves around 9% of voyage emissions – some studies claim up to 14% berth to berth. These approaches do not take huge investments but they do require take huge collaboration.”