GMF Annual Summit: The industry must act now

According to GMF, held under the theme ‘Currents of Change’, perhaps the biggest change revealed by the Annual Summit 2024 was just how far the shipping industry has advanced in recent years. It was also clear that conversations about whether the sector should do more to retain and attract talent have shifted to a recognition that it must act now, while uncomfortable topics once off-limits, like flags of convenience and the risks posed by the dark fleet, are now being addressed head-on.

Platitudes will no longer suffice; instead, the industry needs to move toward developing universal principles and standards to provide clear guidance on improving crew welfare

… said Johannah Christensen, Chief Executive Officer, Global Maritime Forum

Policy clarity is coming

Commercial mechanisms to connect fuel producers and buyers are starting to emerge. In short, the decarbonisation of the industry is no longer a matter of if—it’s a matter of how.

The Summit revealed that even the “how” is coming into sharper focus. IMO Secretary-General Arsenio Dominguez emphasised that the regulatory body is advancing precisely as planned with its revised greenhouse gas strategy. He expressed confidence that the clarity industry leaders have been clamouring for, including a goal-based marine fuel standard and an emissions pricing mechanism, will come in 2025. Regulations like FuelEU Maritime and the extension of the EU’s Emissions Trading System (EU ETS) to the maritime sector are also helping to advance the business case for decarbonisation.

But the Summit discussions also stressed that regulations will only go so far. Finding commercial solutions that make sound business sense, along with government support to bridge the initial price gap, will need to do the rest.

Promising new fuel auction mechanism

One of the biggest challenges the industry has faced is cracking the code on how to successfully ensure an adequate supply of zero-emission fuels needed for the energy transition. Fuel producers have been hesitant to scale up production without secure offtake agreements, while buyers are wary of committing to zero-emission alternatives before prices get closer to today’s carbon-based marine fuels—something that can’t happen without scaling up production. This so-called “chicken-and-egg” dilemma has long vexed the industry, but the solution felt closer in Tokyo than ever before.

That was evident by the massive interest in a tangible example presented by Susana Moreira, Executive Director and Co-Chair of H2Global Foundation. H2Global is an auction mechanism being used by the German government to stimulate the market for hydrogen-based fuels.

While different ways to aggregate fuel demand and overcome the “timing gap” between fuel project development and shipping companies’ readiness to commit have been explored before, none have generated quite the same level of post-Summit buzz as H2Global. When combined with buyer-side consortia like the Zero Emission Maritime Buyers Alliance, it may provide the model to enable fuel offtake at scale.

While there was much to report on the industry’s progress, there was also wide acknowledgement of how far we have yet to go.

… commented Jan Dieleman, Chair, Global Maritime Forum