The shipping industry is facing a climate crisis – will it decarbonise? | Environment

IIn August, Maersk, the world’s largest shipping company, announced that it would add eight new container vessels to its fleet, which would be unlike any merchant ship operating on the high seas today. Instead of running on “piles” of fuel – the tar-like substance left behind after oil refining – Maersk plans to run these ships on carbon-neutral methanol, a colorless liquid made from biomass such as agricultural waste or by combining sustainably generated hydrogen with carbon dioxide.

Globally, very little of this “green” methanol is produced today, and compared to the oil industry’s waste product, which most ships run on, the costs are high. Maersk has not yet announced a fuel supply for its new fleet, but the company hopes that setting up the world’s first green methanol-powered fleet will spur the energy sector to significantly increase the production of clean fuels.

“Instead of talking about how this can not be done, let’s just get started and let’s start scaling,” said Morten Bo-Christiansen, head of decarbonisation at Maersk.

It is a small step towards the huge goal of decarbonising shipping, an industry that accounts for around 3% of global greenhouse gas emissions and is far from achieving the goals of the Paris Climate Agreement.

Until now, shipping companies operating in remote international waters far from the public have managed to avoid meaningful climate regulation. But the industry is facing a showdown. The US, EU and other major economies have begun making promises and drawing up plans to greener the shipping sector, and at Cop26 a coalition of countries including the UK and the US signed a statement pledging to “strengthen global efforts” to achieve net . zero in 2050.

Business leaders are beginning to take notice. “Our crews see this as the most important thing on their boardroom agenda now,” said Guy Platten, secretary general of the International Chamber of Shipping, an industry association representing about 80% of the world’s merchant navy.

A Maersk container ship is loaded at a port terminal in Bremerhaven, Germany.
A Maersk container ship is loaded at a port terminal in Bremerhaven, Germany. Photo: Fabian Bimmer / Reuters

A huge industry with a huge climate footprint

The shipping industry is a critical pillar of the global economy, with around 90% of all world-wide commodities – from oil and steel to furniture and iPhones – sailing around the world by sea. To move all of these goods, merchant ships burn about 300 million tons of dirty fossil fuels each year and emit about 1 billion tons of carbon dioxide in the process. This is roughly equivalent to Japan’s annual carbon emissions.

The shipping industry will need to eliminate these carbon emissions by 2050 to stay in line with the Paris Climate Agreement’s 1.5C global warming target. But between 2012 and 2018, its emissions increased by 10%. The International Maritime Organization (IMO), the UN body that regulates shipping, predicts that by 2050, industrial emissions could be 30% higher than they were in 2008.

In order for this to change, stricter rules are needed. The IMO adopted an initial energy efficiency regulation for ships in 2011, which set minimum requirements for fuel efficiency per capita. kilometers traveled, and another in June aimed to reduce ships’ carbon intensity by 40% by 2030.

These standards have “basically codified a business as usual trend”, says Faïg Abbasov, director of shipping program at the Belgian non-profit Transport & Environment. The June measure requires shipping companies to give their ships an AE rating on energy efficiency and submit a “corrective action plan” for all ships receiving a D or E for three consecutive years. But the results will not be made public and there is no mechanism to force dirty ships to improve, Abbasov said.

In 2018, the IMO set a goal of halving the industry’s carbon pollution at least by 2050. But it has not adopted any binding emission reduction targets or rules to achieve the target, and even if it did, the target is still far from what is needed to remain in accordance with the Paris Agreement. Industry observers attribute this partly to the slow nature of rule-making in the IMO, but also to the influence of companies in the UN agency, where industry representatives are often appointed to serve in state delegations.

“There is very little doubt,” said Aoife O’Leary, CEO of Opportunity Green, a non-profit focusing on international climate issues, including shipping.

A rag rug of rules

But change seems to be on the horizon. The EU is now in the process of regulating ship emissions under its emissions trading system, with a phase-in beginning in 2023. According to the proposed law, in 2026 shipping companies will have to pay for the carbon they emit when traveling to and from the EU and between ports.

Separately, the EU is proposing a fuel mandate that will force the industry to use a gradually increasing share of low-carbon and zero-carbon fuels in its ships. And in April, the United States committed to pursuing an emissions-free shipping industry by 2050.

While the shipping industry has pushed back against the idea of ​​a patchwork of climate rules across different nations, O’Leary said these could force the IMO to take more ambitious action. “If you look at the history of IMO rules, they have often acted because the EU or the United States has acted on its own,” she said.

The industry seems more eager to talk about climate. In March, the International Chamber of Shipping proposed a carbon tax of $ 2 per tonne. tons of fuel for research and development of clean shipping technology. This proposal, along with a far more ambitious proposal from the Marshall Islands to tax merchant ships worth $ 100 per tonne. tonnes of bunker fuel, will be discussed at an IMO meeting in late November.

The plate from the International Chamber of Shipping would not say whether the industry would support the specific fuel tax proposed by the Marshall Islands. But he said shipping companies “welcome the discussion and debate on market-based measures” to reduce emissions and make low- and zero-carbon synthetic fuels more economically viable. In October, ICS called for the next zero emissions for industry by 2050, doubling the IMO’s ambitions.

A container ship at Port Botany in Sydney.  About 90% of world trade is transported by sea.
A container ship at Port Botany in Sydney. About 90% of world trade is transported by sea. Photo: Mick Tsikas / AAP

The hunt for carbon-free fuel

Transforming the shipping sector means that carbon-free fuels must become available on a commercial scale along with the necessary infrastructure to pump them into ships. Green methanol, ammonia and hydrogen can all be produced with renewable energy, in processes that start with splitting water in an electrolyzer to produce hydrogen. But while green methanol can be dropped in existing ships with fairly minimal retrofitting, the other two will require significant changes to ship design and operational procedures.

Ammonia and hydrogen are gases at room temperature and will need cooling tanks to store as liquids. Ammonia is also toxic to marine and human life, increasing safety and the environment. Hydrogen, meanwhile, has a very low energy density compared to oil, which means that ships that use it have to transport much larger amounts of fuel or be refilled much more often.

Proving that alternative fuels are safe and reliable to use on commercial ships, and then scaling them up and implementing them across the global shipping industry will be an expensive and time consuming endeavor.

“What we are really looking at is decades of investment and innovation ahead of us,” says Bo Cerup-Simonsen, CEO of Maersk Mc-Kinney Møller Center for Zero Carbon Shipping, a research and development center. “It’s fair to say we’re talking about billions,” he said, “but I think the trillions will come when we start scaling this up to become industry-wide.”

Researchers have estimated that if zero-emission fuels make up 5% of the international marine fuel mix by 2030, industry will be on the verge of fully decarbonising by 2050. Global Maritime Forums Getting to Net Zero Coalition believes the target is achievable based on recently announced plans, including the EU 2020 hydrogen strategy, which requires the construction of at least 40 gigawatts of renewable hydrogen electrolysers by 2030, as well as China and Japan’s targets to increase hydrogen fuel production.

Pete Buttigieg, US Secretary of Transportation, talks about zero emissions in shipping at COP26 on November 10 in Glasgow, Scotland.
Pete Buttigieg, US Secretary of Transportation, talks about zero emissions in shipping at Cop26 on November 10 in Glasgow, Scotland. Photo: Ian Forsyth / Getty Images

‘We are not there yet’

While the task ahead is daunting, Cerup-Simonsen is optimistic. The number of large companies expressing interest in carbon-free shipping is growing “day by day,” he said, as is the interest from their customers. “You see mining companies, some of the big retailers, big car manufacturers starting to demand a greener one from their supply chains, including shipping,” Cerup-Simonsen said.

Large consumer-facing companies could be the key to helping create change in the shipping industry, says Madeline Rose, climate campaign director at Pacific Environment, who recently led a report on shipping pollution associated with 15 major retail brands, including Amazon, Walmart and Target.

In 2019 alone, the report found that these companies were responsible for the value of three coal-fired power plants’ value of carbon pollution through their U.S. ship imports. Despite ambitious climate promises in recent years, most of the companies highlighted in the report do not appear to take marine pollution into account in their reporting of corporate emissions.

Amazon, along with companies including Ikea and Unilever, signed a pledge in October to move only goods on ships that use carbon-free fuel by 2040.

While retailers demanding cleaner shipping may motivate shipping companies to bring new opportunities online faster, Abbasov of Transport & Environment is skeptical that voluntary business commitments will drive transformative change. For now, he says, rules are needed to make alternative fuels more economically attractive and prevent corporate greenwashing.

“Once there are rules, once the technology has become very common, individual companies can take an extra step and go further than the law says,” Abbasov said. “In terms of shipping, we’re not there yet.”

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