Carbon clean-up: curbing carbon emissions in the maritime sector
The maritime sector, a key generator of global trade and economic activities, is undergoing structural changes influenced by many trends, factors and developments. They include political, economic, social, technological, financial, environmental and legal forces that have transformed and will continue to influence the landscape of the sector in many ways. In addition to these, concerns over carbon emissions have emerged as a key driver that is reshaping the way industry players think, plan, invest and operate. There is growing pressure for the sector to clean up its act amid growing demand for maritime-related services such as shipping, port operations, shipbuilding, ship repairing and host of other ancillary services. Players in the maritime sector simply cannot maintain the status quo and hope for the problem of global warming to go away. As demand for services in the maritime sector grow in line with growing global seaborne trade, offshore oil and gas activities and other economic activities requiring ships, ports and other maritime components, emissions from the maritime sector is expected to be on the rise.
To underscore the gravity of the question at hand for the maritime industry, take the case of merchant shipping which facilitates much of international trade volumes. Despite shipping contributing a mere 3.3 percent of the global total of carbon emissions (see diagram 1) (1), it was estimated that carbon emissions from shipping had doubled since 1990 (2). It was also projected that carbon emissions from shipping will grow by a factor of two to three by 2050 from 2007 levels should no regulatory measures are put in place to lower the emissions (3). The levels of sulphur oxide (SOx) emanated by merchant vessels which use normal high sulphur fuel are significant, and urgent actions are required to reduce them.
From an environment protection perspective, the advantage of seaborne transport over other modes of transport is undisputed, as supported by the following facts (5):
One heavy truck carrying 25 tonness of freight uses 370 percent more fuel per tonne than a tug and barge carrying 1,750 tonnes of dry cargo. A heavy truck generates 230 more CO2 (in grams per tonne/kilometre) than a ship that can carry up to 8,000 tonnes of cargo.
A medium sized truck uses 0.49kW of fuel per tonne/kilometre, compared to 0.08kW per tonne/kilometre used by a cargo ship with a capacity between 2,000-8,000DWT and 0.06kW per tonne/kilometre used by a cargo ship with a capacity above 8,000DWT (6).
A single 500TEU or 250FEU container ship could transport all the freight carried by 190 trucks leaving the ports of Los AngelesLong Beach daily heading north to Ventura County and its vicinity in the state of California in the United States.
With seaborne trade, port operations, shipbuilding and maritime activities such as offshore oil and gas set to increase in the years ahead, it is fair to expect carbon emissions from the sector to increase in tandem. Infrastructure development and activities in the maritime sector are set to add to existing pressure on the marine environment and beyond. As such, serious efforts must be taken by industry players to endeavour to reduce their carbon emissions to mitigate the risks faced by the marine environment.
Challenges for the maritime sector to go green
Many challenges such as lack of resources, weak regulatory framework, lack of consensus among stakeholders and technological limitations must be overcome before the maritime sector can significantly reduce its carbon emissions and come up with a workable regime to address climate change.
The failure of the 15th Conference of Parties (COP15) in Copenhagen in December 2009 to reach a binding agreement to reverse climate change and its impacts underscores the difficulty of rallying the global community top own up to the problem and do something fast to address it. Although other international meetings will be held subsequent to the Copenhagen meeting, it would take a real optimist to think that the nations of the world would set aside their differences and take a common stand to counter climate change. An effective, sustainable and acceptable set of solutions to this growing problem seems miles away, given the wide rift, tentativeness and disagreements among nations and lack of assertive actions on display in Copenhagen.
It has become increasingly obvious that adjusting to a low-carbon future is imminent and the maritime sector needs to do the needful to cap its carbon emissions and play its part to address the issue of climate change. With seaborne trade and maritime activities such as offshore oil and gas set to increase in the years ahead, it is fair to expect carbon emissions from the sector to increase in tandem. This is set to add to existing pressure on the marine environment and beyond. As such, serious efforts must be taken by industry players to endeavour to reduce their carbon emissions to mitigate the risks faced by the marine environment.
However, attaining a clean and green operating environment in shipping is a gargantuan task. Many challenges such as lack of resources, weak regulatory framework, lack of consensus among stakeholders and technological limitations must be overcome before the maritime sector can agree on a workable global regime to significantly reduce its carbon emissions. Developed nations must endeavour to assist developing countries which lack resources, technology and technical know-how to comply with green standards. Proposed measures such as market-based instruments must take into account their limitations and must not deny them the opportunity to carry out seaborne trade and conduct shipping activities at a competitive disadvantage.
In the face of growing concern over climate change, various studies have been undertaken to make shipping more energy-efficient and cleaner. IMOs Greenhouse Gas Study updated in 2009 reported that the application of known technology and practices could make vessels more efficient between 25 to 75 percent, depending on vessel type (7). However, adapting such technology and practices may open a Pandora Box of other issues. In the event that shipowners pass the costs incurred from going green onto their customers, the latter will in turn pass their costs down to end users and consumers of the cargo they ship.
That is just one of the many challenges faced by the maritime sector to reduce its carbon emissions. This is most notable in the shipping sector, where various ideas and studies have been generated by the academia, shipping consultants and research institutes. However, even ideas to green the shipping sector proposed by IMO have not seen the light of day due to political roadblocks and other obstacles. For example, the plan to introduce a market-based instrument to facilitate carbon trading in the shipping sector has been met with strong opposition on grounds of lack of familiarity of industry players with the cap-and-trade system (8) and its potential implications on their financial statements (9). One can expect similar resistance to many other proposals to IMO and heated debate at MEPC sessions to deliberate the merits and demerits of green solutions in the shipping sector.
Overcoming the obstacles
There are several major hurdles that need to be cleared before the maritime sector can reach a consensus on the best approach to reduce its carbon emissions. They include:
– Mistaken belief among industry players that the status quo is acceptable given that the maritime sector is not a key emissions culprit.
– Lack of awareness of industry players on the gravity of the problem of global warming and their contribution to emissions
– Lack of financing and human capital to procure and operate green technologies
– Weak regulatory structures and institutional framework to push green efforts
– Dependency of trading nations, especially developing ones, on seaborne transport and the maritime sector for economic growth
– Lack of understanding of the dynamics of initiatives such as market-based instruments, and fear that such measures may lead to double standards and competitive disadvantage
– Protectionist measures by governments
– Tendency of the shipping industry to react slowly to changes
– The way ships are designed and built in a way that minimizes cost with the view to operate them at the lowest cost possible
– Global recession delaying green initiatives
The formidable challenges presented by these hurdles and the absence of a target for the maritime sector to reduce its carbon emissions should not be seen as an excuse not to take actions to reduce shippings carbon footprint. The environmental and financial costs to pay to clean up the mess and reverse the impacts of carbon emissions from the maritime sector on the environment would be much higher in future than investing in measures to reduce the sectors carbon footprint today.
Several pertinent questions need to be addressed in pushing the green agenda forward for the maritime sector. They include:
– Has the shipping sector been complacent about going green despite being a clean transport mode?
– Can players in the maritime sector be relied upon to clean up their acts voluntarily without regulatory pressure?
– Will industry players pass the cost of going green to their customers?
– What is the true economic price that the maritime sector has to pay for the environmental resources it uses?
– Are current technologies and pace of innovation adequate for maritime sector to significantly reduce its carbon emissions, in the face of rising demand for their products and services?
– Will shipping be treated merely as a source of funding for UNs CO2 reduction plans?
– Will IMO be able to rally nations and industry players to subscribe to its green agenda and buy into its green measures?
– Can resources be made available to developing countries to go green and can they be convinced that going along with green measures will not result in competitive disadvantage?
– Will the introduction of market-based instruments andcap-and-trade systems be effective to curb emissions from ships?
– Can the effectiveness and sustainability of voluntary efforts to go green by shipping companies, port operators, shipyards, offshore oil and gas companies and other players in the maritime industry be relied until such time a mandatory and globally accepted green regime be introduced for the maritime sector?
In answering these questions, it is important that detailed information and data are available to enable the stakeholders to quantify emissions from the maritime sector and for policy makers and industry players alike to make informed decisions and lay out appropriate strategies. Much progress has been made in greening the maritime sector, but much more needs to be done to address issues, overcome challenges and answer questions before the sector can be considered truly green and environmentally friendly. The stakeholders need to close ranks, make sacrifices, enhance awareness, invest in resources, demonstrate exercise political will and live up to their corporate social responsibilities for any efforts to green the maritime sector to have any chance of succeeding.
Source: Baird Maritime
