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Energy transition and uncomfortable questions for shipping

Greg Atkinson, chief technology officer at Japan’s Eco Marine Power, explains to Splash readers how shipping can learn and flourish from embracing the concepts of the circular economy.

Last month I was invited by the Credit Suisse Research Institute (CSRI), to participate in meetings related to the energy transition – a term that encompasses the shift away from fossil fuels and towards a reduction in greenhouse gas (GHG) emissions. For my part I made a presentation during which I touched upon some of the challenges shipping faces during this transition and briefly discussed a few solutions we have been working on at Eco Marine Power. Perhaps more importantly though, I was able to gain a better understanding of the global trends in regards to energy transition, and how shipping is viewed by those outside the industry in terms of the measures being taken to lessen its impact on the environment. During my presentation I also suggested that shipping needed to deal with some uncomfortable questions. That is to say, the discussion needed to move beyond contemplating alternative propulsion technologies, lower carbon fuels & the reduction of emissions, to a deeper reflection about the industry itself.

For example, should we be examining in detail what type of cargoes are transported by the world’s shipping fleet and how much energy is needed to move these cargoes? Should waste be transported by sea to developing nations for disposal, or should greater investment be made in recycling and waste processing so that wealthy nations can manage their own trash? Should live animals for meat consumption be shipped half way around the planet or should the meat be processed in the country of origin? Should spring water from Europe be sent over 10,000 km to Australia so that consumers have a wider range of bottled water to choose from? Yes I know it gets dry down in the great southern land, but I don’t think bottled spring water is going to drought-proof the parched country of my birth. I am a believer in free markets and trade, but not to the extent that we go out of our way to damage the environment and waste resources.

There are also some uncomfortable questions specifically for the cruise ship sector. In particular, how many floating resorts do we really need and are some of the ships becoming too large? Are cruise ship companies serious about reducing energy consumption, or is greater emphasis placed upon on-board attractions including theme park rides. Bearing that in mind, it’s worth highlighting that:

“On average, one cruise ship emits as much black carbon as 4,200 Euro V heavy-duty trucks operating 100,000 km over one year. Further, cruise ships emit the most BC per unit of fuel they burn: the average cruise ship emits 0.34 kg of BC for every tonne of fuel, compared with 0.26 kg/t for a container ship.” Black Carbon Emissions and Fuel Use in Shipping. ICCT. (2015).

Furthermore, how many cruise ships should operate in pristine marine environments and should there be a limit on the types and numbers of vessels that can operate in these regions? I admit that the thought of sailing to Antarctica is appealing, but it’s also an experience I accept can be forfeited so that we allow some places on this planet to remain almost untouched by humans.

Another question to ponder is: are the right types of ships being built? For example can the expected increase in demand for shipping be met and emissions reductions achieved, if we continue to have large bulkers sailing from Australia or Brazil to China full of iron ore, and then have them make the return journey empty? Admittedly it would not be easy and also probably quite expensive to build ships capable of carrying bulk cargoes and containers, but maybe it’s something that needs to be considered. Already general cargo ships exist that can carry multiple types of cargo, so perhaps more emphasis could be placed on designing and building ships with this type of capability.

Vessels being built today are generally cost effective in terms of the current business and operating conditions, but in the near future these conditions are likely to be very different. Conceivably ships and shipping at the moment might be priced too low in terms of dealing with the challenges presented by a lower carbon- intensity global economy. On the other hand if costs were to rise, this may disadvantage developing economies that need to be able to competitively export their products or worse still, it may result in some cargoes shifting onto less energy efficient modes of transport including aircraft and trucks.

Perhaps there’s more that can be done to streamline the shipbuilding industry though. That doesn’t necessarily mean simply closing down shipyards, but rather further consolidation in terms of ship design so that proven energy efficient ship types can be built at lower cost at several shipyards that share a common global design organization. To assist with this class societies though should standardise their design guidelines and perhaps further mergers amongst these organisations are also required.

Another consideration is that ships being built now might in environmental terms become obsolete in 10 or 20 years. For example, could a ship with an open-loop scrubber become a stranded asset due to its environmental impact? At this stage we still don’t know enough about the impact of scrubber discharge water on the marine environment, but this is now a technology that has been bounced across the mainstream press with some very dark headlines.

So how does shipping respond to such concerns? Well, in some cases the thinking appears to be that if companies band together in an alliance or association, that somehow their public relations efforts will be able to win over the doubting public. Shipping needs to deal with greenhouse gas emissions and pollution, so there’s not much point making comparisons to the airline industry for example or looking for reasons to complain about regulations aimed at reducing emissions or pollution. Associations and alliances may appear effective at churning out press releases and gaining media attention, but for those outside shipping, the narratives often being circulated by some of these groups are not only predictable, but also reinforce the view that shipping is unwilling or unable to develop and implement the changes required.

I do however appreciate how frustrating it must be for shipowners to try and manage their businesses over the long term, when they are unsure what new regulations, guidelines or taxes etc. might be implemented in the years ahead by a maze of organisations including port authorities, classification societies and governments.

Certainly new regulations that are proposed by (or via) the International Maritime Organization (IMO) need to be subjected to scrutiny and this is where I believe some reform is required. My concern is that this process could be overly influenced by lobby groups whereas a broader range of views especially from the scientific and engineering fields would help maintain confidence in this process. Enforcement of regulations also needs the support of nation states, so this requires the utmost confidence in the procedures leading to the adoption of new regulations.

Overall it became apparent during the CSRI meetings that many of the changes heading towards shipping as part of the energy transition are going to originate from outside the industry. There were for example discussions dealing with the concept of the circular economy – an economic system that is aimed at encouraging recycling, re-use, sharing, repair, refurbishment, re-manufacturing and the reduction of waste. This circular economy approach could be applied to the shipping sector and it’s also an area where the industry could be viewed as being in a leadership role due to its global influence. A focus on the circular economy for example might affect the design of ships, how they are built, how they are operated and how they are recycled or disposed of. It’s also a concept that is not dissimilar to sustainable shipping, and so there’s work that has already been done and that can be expanded upon.

There are of course many companies and organisations across shipping working to improve energy efficiency, reduce pollution and lowering GHG emissions. These efforts should be acknowledged, applauded and encouraged so that other companies embrace similar initiatives. But let’s not confuse the growth in green shipping events and awards with the actions needed to deal with these challenges.

Certainly the issues discussed in this article also need to be addressed by nation states, other industries and various national and international organisations. They are complex issues and I’m not suggesting that dealing with them will be easy. But they are also areas where shipping can get out in front of the debate and be proactive in suggesting possible solutions. In that way, shipping will not only be able to improve its image, but also attract the resources and investment it requires to shift into the emerging low-carbon global economy.

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Comments

  1. Dear Greg, well written en some profound – and indeed uncomfortable – observations by placing shipping’s role (or “purpose” to use a fashionable term) in the broader perspective of the global economy.

  2. Dear Greg, thanks for a very insightful article and for opening the debate on the need to look beyond a very narrow BAU view of the role and responsibilities on the shipping industry as we move closer to decision time on whether to decarbonise the industry or hold on to BAU a little longer.

    Like you I do salute those industry leaders that are taking real action on decarbonisation of the industry and embracing the need for transition to happen as a priority.

    And yes, it must be incredibly frustrating to deal with uncertainty and the easiest way to do so is to collectively make the decision that full decarbonisation is needed as quickly as possible and get down to the nuts and bolts of making that happen as smoothly as possible. The IMO has committed to a science-based approach and 97%+ of world science agrees – since the initial Strategy level of ambition of at least 50% was agreed , numerous science has been published that demands level of ambition be drastically increased and we must expect this be reflected in the levels of ambition in the final Strategy in 2023.

    So, we remove uncertainty by being totally committed to the forthcoming transition and now we need to agree the measures and speed of implementation. This means MBMs.

    Could I offer another suggestion to add to the list of uncomfortable questions that need addressing?

    1. CBDR-RC v NMFT. The initial strategy is framed in terms of two ‘principles’. There has been no meaningful debate to date on how either or both are to be given effect to. Of course, only one is actually an internationally accepted principle, NMFT is only a convention adopted through repeated reference in IMO record.

    The next step at IMO is mid-term measures, which means that we may finally get to discuss MBMs. In 2009 the IMO concluded it was essential that MBM’s be part of the basket. No science has been produced since to challenge this. The initial strategy walks back the 2009 position by saying that MBM’s MAY be considered as a potential mid to long term measure. No-one appears ready to discuss this with any urgency. It will be of no surprise if the next ISWG round includes submission aimed at re-identifying the MBM options, rather than on which, when and how much, and the industry will again hint at a voluntary lowballed fund to spur industry R&D administered by IMO. It is increasingly clear that a carbon tax on bunker is needed now.

    The difficulty with discussing the money is 2-fold. Firstly, more than 70% of shipping is domiciled in SIDS/LDCs or developing states which receive often only marginal benefit under a variety of arrangements that allow the majority of ship owners and operators to pay little or no tax and remain anonymous in the process. This is a trend that began in Liberia post-WWII and has grown exponentially since to now being an accepted norm. This doesn’t make it right, it just makes it accepted.

    Secondly, the IMO has already agreed by overwhelming majority as reported to UNFCCC in 2009 that the bulk of any revenue gained through MBMs – in whatever form – would revert to SIDS/LDCs/ the climate most vulnerable for their most pressing adaptation and mitigation needs.

    So the uncomfortable question, is will the IMO and shipping resile from this point of principle? If so, will doing so meet the tests of the principle of CBDR-RC or the convention of NMFT?

    These are certainly uncomfortable questions. This doesn’t mean they can be avoided and it is unlikely that any real progress is to be made until they are openly debated.

    Just as in the transition from sail to screw, it has to be assumed that there are minor and major fortunes to be made by those who navigate the seas of change best and that shipping will continue, as it has for some centuries, to be a major player in global economies. It is also to be assumed that the more efficient shipping is, the more profitable it is and there is only ultimately profit to make long term by ditching oil.

    I have no issue with that – the world needs well run, highly efficient, profitable shipping services, the large emerging and developed world economies in particular. The rest just need to survive. And that means shipping playing its part in decarbonising its own footprint and paying its fair share to ensure the survival of the most vulnerable. Or at least give them fighting chance. Or just chance. But we already agreed that. In 2009. Right?

    More than ever its #1.5tostayalive

  3. Very good points Peter and thanks for your comments. We seen to agree that shipping needs to enter a fairly significant transformation period or perhaps era is a better term. The only point I would question is having R&D administered by the IMO as I’d prefer to see R&D less centrally managed so that the usual suspects don’t always seem to get the funding.

  4. In case anyone else, like me, is interested in the general topic, but has no idea what the abbreviations stand for (I had to look them up), here’s some help:

    CBDR-RC = Common but Differentiated Responsibilities and Respective Capabilities (CBDR–RC) is a principle within the United Nations Framework Convention on Climate Change (UNFCCC) that acknowledges the different capabilities and differing responsibilities of individual countries in addressing climate change

    MBM = Market Based Measures

    NMFT = No More Favourable Treatment

    BAU = Business As Usual

    Please correct me if I’m wrong!

  5. A lot of words and use of abbreviations can hinder an objective view like a lot of rain can have on a view too.

    Shipping industry, a lot of universities and true scientist are working on the best solution since decades. But let me explain more here to avoid a misleading pictures made by the spectators with the’ right’ opinion:

    If IMO has committed to a science-based approach, then SCIENCE-based approach ist meant.

    The mentioned 97%+ consensus of alleged scientist around the world – and consensus is the opposite of science – is based on, best to be described as, JUNK-science.

    Spectator:
    It is always comfortable to have an extreme position and let the others find out, how to reach your plan – a plan of people who believe in their OWN science. The more unrealistic this plan is, the more reason and fun you will have pointing with your fingers at it. If you’re on the ‘right’ side! For this you need a proof.
    And repeating OWN science does not make it science, it’s not!

    And how comfortable it is from this position to understand how uncomfortable for the others is to deal with, that is just cynical.

    More interesting, hence, how to think logical:
    Let’s take John Stuart Mill and pick up his thoughts:

    “How can great minds be produced in a country where the test of a great mind is agreeing in the opinions of small minds?”

    In a similar way it can be said:
    “How can a great solution be produced in a world where the test of a great solution is agreeing in the opinion of small minds?”

    Small minds are also those, who say that CONSENSUS is science.

    It is a fact that worldwide industry and science is busy finding solutions and improvements since decades and testing solutions for a carbon-free world. If (science, proofed) it is found that production, maintenance and decommissioning proves to use more CARBON that can be saved by the solution during it production live, then this is a NO GO !

    This you can find with wind turbines: Production, special trucks, barges and ships, special cranes, also special floating and jack-up offshore cranes, all with a lifespan of 20-25 years, installation, connections, decommissioning, storage of the scrap etc. cause more carbon per wind turbine than that each single unit can ever recoup in its 20-25 years of energy production.

    Still people think it is the best way. People are made believe that it is the best way! Media!
    CO2 seems more important than life of birds, insects, environmental change, noise, shadows, a few to be mentioned.

    And if there is no wind? No sunlight? The power stations are needed further on. It shows to be a costs accelerator hitting the small households at its most.
    Not for those who can afford the luxury of a weekend house or a sailing yacht big enough to live on: The spectators dwelling in luxury.

    And: Carbon-Dioxide, CO2?

    It’s part of nature from the beginning of live on earth. It proofed to be warmer and wealthier on earth together with much higher levels of CO2 than nowadays. Science proofed that temperature increased before CO2 increased. It proofed that humanity flourisched in periods when it showed to be warmer then now.

    Patrick Moore, co-founder of Greenpeace:
    “By the mid-1980s, the environmental movement had abandoned science and logic in favor of emotion and sensationalism. I became aware of the emerging concept of sustainable development: balancing environmental, social and economic priorities. Converted to the idea that win-win solutions could be found by bringing all interests together, I made the move from confrontation to consensus.”

    Consensus among different parties is meant, not consensus among believers in order to make it science!
    Consensus among participants in media and opinion is critical also. It is similar to as with a group of people saying that a specific religion is good.

    More logic?
    Last but not least:

    There were only a few million humans, if at all, when the arctic ice cap – that covered big parts of the northern hemisphere – melted. Big parts of Northern America, Europe and Asia were covered by hundreds of meter of ice. Humans could walk from Asia to Northern America, or from the continent to what is now Great Brittan. Since then the water level rose 120 m and it still does about 2,5 mm/year. And there is no any increase observed.
    Humanity flourished since then!

    It is foolish and a proof of small mindset to believe and to pray that human population can have influences on that.

    Unless you can make a living of it, or even better: A lot of money!

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