Allianz Commercial explains that enhancing shipyard capacity will be essential for facilitating the addition of thousands of environmentally friendly ships to the worldwide fleet over the next twenty-five years.
According to the Safety and Shipping Review 2024, another goal would see green technologies, fuels and/or energy sources represent at least 5%, but preferably 10%, of the energy used by shipping by 2030. Reaching the revised GHG reduction targets will require a mix of strategies, including measures to improve energy efficiency, the adoption of alternative fuels, innovative ship design and methods of propulsion. Insurers like Allianz are supporting the industry as it experiments with biofuels, ammonia, methanol, and green hydrogen, as well as electric vessels and wind assisted propulsion systems, such as wing sails, rotors, and foils.
However, decarbonization will present various challenges for an industry juggling new technologies alongside existing ways of working. For example, the industry will need to develop infrastructure to support vessels using alternative fuels, such as bunkering and maintenance, while at the same time phasing out fossil fuels. There are also potential safety issues with terminal operators and vessels’ crews handling alternative fuels that can be toxic or highly explosive.
Increasing shipyard capacity will also be key as the demand for green ships accelerates. Such capacity is currently constrained with long waiting times and high building prices.
…the report highlights.
Over 3,500 ships must be built or refitted annually until 2050, yet the global shipbuilding industry built 2,700 vessels a year at its peak in 2010,
while the number of shipyards more than halved between 2007 and 2022. At the same time capacity constraints on shipyards could have a knock-on effect for repairs and maintenance, with damaged vessels or those with machinery issues potentially facing long delays.
Capacity constraints on shipyards will limit options for decarbonizing the fleet. For insurers this is an important topic as the world fleet ages. Older vessels have a very different exposure profile to new builds and younger vessels.
..Justus Heinrich, Global Product Leader, Marine Hull, Allianz Commercial, pointed out.
The shipping industry must decarbonize the global fleet in a relatively short time frame, and yet there is presently no single clear technical solution. Potentially, the industry is heading for a multi-fuel future.
