Mikael Laurin, managing director of Yara Marine Technologies, on the need to address continued hesitation in the market linked to not having long-term tried and tested solutions readily available for decarbonisation. Green tech companies ought to work on communication and collaboration to reassure owners who may otherwise be on the fence.
The recent unprecedented wave of extreme weather events has brought home the urgency of the ongoing climate crisis. As stated in the sixth report of the UN’s Intergovernmental Panel on Climate Change (IPCC), unless we realize wide scale changes now, we are likely to see disastrous results of global warming. The UN Secretary General, Antonio Guterres, calls the report a “code red for humanity.”
The maritime industry is already aware of the need for urgent action. The International Maritime Organization (IMO) initiated the push towards zero emissions a decade ago, and maritime and offshore sectors in many countries are working to achieve these goals. Further regulations are now coming into force as countries ensure that there is infrastructure available to address these issues. Also, industry led initiatives – such as the International Chamber of Shipping’s recent presentation to the UN of a proposed global levy on carbon emissions from ships – speak of an industry working hard to reduce the 2% of carbon emissions attributed to the sector.
Transitioning during a global pandemic
However, this urgent call to action comes as we near the end of year two of a global pandemic, the effects of which have emphasized the necessity of a functioning maritime industry. Shipping carries over 80% of global trade today, and the trade volume is expected to triple by 2050. Availability of e.g. food, medical supplies, and infrastructure are dependent on ship transportation at the same time as there is pressure to minimize the impact of shipping on the environment. Emissions from shipping will certainly form a key part of discussions at COP26, and the industry is preparing to comply with the regulations on EEXI (Energy Efficiency Existing Ship Index) and CII (Carbon Intensity Indicator), which lay the foundations for continuous improvement of the global fleet.
This means that many of us in the maritime industry find ourselves performing a balancing act. On the one hand, shipping operators have many of the resources and information needed to transition to safer and cleaner performance, while on the other hand the pandemic has hit the global economy and company finances hard, and this has had a negative effect on many shipping sectors. We must also contend with the fact that many players postponed their planned, green initiatives over the past two years to allow global trade to continue unhindered and due to market uncertainty. Many operators feel that there is no obvious path forward.
This challenge is not new. We have always had to try and balance the aim of minimal emission operations from a climate perspective against the price required to make progress. This is one of the primary reasons why I firmly believe in the value of designing for sustainability. This potentially minimizes costs while still allowing us to maximize investment in innovative solutions.
Expanding the market for green technologies
Although there is large scale industry buy-in to transitioning to more sustainable operations, we will see a division into two distinct factions: One that is heavily invested in green technology, and the other that remains skeptical about how efficient the new solutions and processes are likely to be. The former doesn’t need convincing to invest in greener operations as those stakeholders are already doing their utmost to set internal standards that are higher than those set by global regulatory bodies. It is the latter that I think we as an industry need to engage with, particularly as they make up a significant portion of the global fleet.
When I call them industry skeptics, I do not mean they are opposed to sustainability or against regulation. Instead, I mean that they are skeptical about new solutions that have not yet proven their efficiency onboard and/or ashore and prefer to invest in tried and tested technologies. This is completely understandable. After all, I have seen many examples of new technologies that do not deliver as promised or end up costing much more than expected.
This skepticism can be a problem though, as it can hamper good solutions from receiving investment and getting the opportunity to prove efficacy. We are no longer operating on the same extended timelines as we did before. 2030 is only nine years away, and there are so many things that must be achieved by then to accomplish the goals the industry has set. While big companies need to plan for large investments for fleet-wide actions, smaller companies make up a significant segment of the industry overall and their involvement is crucial if we are to implement change at a grassroots level.
Earlier playing it safe was seen to be a risk-free option, but the risks associated with not reaching our climate goals are now larger than the short-term risks of a failed trial. I believe that change is the new normal; evaluating and embracing new ideas and technology will be necessary to succeed as a company or individual, today and in the future.
That said, there are various technologies already available in the market which facilitate significant and immediate emissions reductions, and most of these have already proved their efficacy. I believe that one of the main challenges for these companies selling and advocating for greener shipping technologies will be communicating effectively, collaborating extensively and proving and re-proving our technologies to ship-owners and operators.
If I have learned anything from my two decades in the industry, it is that we cannot ignore industry perception. There is an urgent need to get the whole industry to accelerate the voyage towards long-term green operations. After all, we need everyone onboard, working towards common goals to make sustainability possible, and acting to save our planet before it is too late.