Tuesday 7 July 2020
Vast majority of shipping execs view decarbonisation as top-three priority
Around 95% of shipping executives view decarbonisation as important or a top-three priority.
That's the suggestion made in a new report from Shell and Deloitte, which suggests nearly 80% of industry stakeholders said the importance of cutting emissions has increased significantly over the past 18 months.
The firms spoke with 80 leaders across the shipping industry to explore how the sector would move towards net zero - it found the journey will likely prove difficult and stresses the need to overcome the "deadlock" brought about by large, long-life assets, thin margins and a high-dependence on a global supply of energy-dense fuels, characteristics of the industry that will likely make emissions reductions "complex and expensive", with one study estimating the total cost at $1.65 trillion (£1.32bn) by 2050.
The sector currently moves approximately 80% of world trade volumes, meaning its carbon emissions will continue to grow alongside the global economy if decisive action is not taken.
The survey also found 85% of interviewees saw market and customer demand as major factors driving change towards decarbonisation, while 80% of interviewees saw technology alignment as a major factor in making net zero feasible and 65% of interviewees saw the ease of replacing infrastructure as an area of major importance in being able to make change happen at speed and scale.
The report says it will be vital to scale-up customer demand for low or zero emission shipping, align global regulations, intensify partnerships to develop cleaner fuels through cross-sector research and development, run end-to-end green pilot projects involving customers, charterers, operators, owners and ports and better co-ordinate industry.
The firm states "The lack of a global regulatory framework and limited customer demand for lower-emission shipping are significant barriers to activate much-needed industry investment. Electric vessels may be an option for inland and short-sea routes, but for deep-sea shipping – which accounts for around 85% of emissions – there is currently no viable alternative fuel that makes it possible to reach the IMO’s 2050 ambition.
"The industry is currently exploring several alternative fuels – including hydrogen, ammonia, methanol and biofuels – but shipping leaders say that they all have commercial and technical limitations."
