CENTRO INTERNAZIONALE STUDI CONTAINERS
ANNO XXXVIII - Numero LUGLIO 2020
TRANSPORT AND ENVIRONMENT
SHIPPING SECTOR PRIORITISES FIVE SOLUTIONS FOR
Shell and Deloitte's new report sets out the industry view on
barriers to decarbonisation and identifies priority solutions for
meeting the IMO's GHG ambitions.
Vice President, Shell Shipping & Maritime
"There is a growing view that now is the time to act if
the industry is to meet the IMO's ambition."
July 07 2020
As the International Maritime Organization (IMO) restarts its
committee work this week with a focus on efficiency measures
ensuring progress towards greenhouse gas (GHG) reductions in the
sector, a new
report published today by Shell and Deloitte finds that 95% of
senior shipping executives see decarbonisation as important or a top
three priority for the industry.
Nearly 80% noted that its importance had increased significantly
over the past 18 months. This finding demonstrates real optimism and
support for progress at the IMO.
The report brings together findings from in-depth interviews
with more than 80 senior shipping executives from organisations
across Europe, North America, and Asia, representing customers, ship
owners, operators, charterers, port authorities, regulators,
technology providers, financiers, equipment manufacturers and bunker
suppliers. It presents an industry view of the barriers to
decarbonisation the industry faces, and the solutions that would
enable it to meet the IMO's ambition of reducing GHG emissions by at
least 50% by 2050.
The results have been both encouraging and daunting.
Despite the research being carried out as COVID-19 spread around
the world and the impact of travel restrictions and falls in demand
were beginning to become clear, senior shipping executives remained
willing and enthusiastic participants. They reported different
drivers to decarbonise - in Europe executives felt a stronger social
and regulatory incentive, and in Asia executives predominantly felt
the incentive was coming from regulation. But in all regions,
decarbonisation is on the agenda.
Throughout the interviews we asked participants what they saw as
the major barriers to decarbonising shipping. Three factors emerged
as key: a lack of market and customer demand; no technological
alignment on what the new fuels would be; and a lack of harmonised
Despite concerns around the deadlock that these barriers can
create, with little clarity on where to start and who should lead,
there was enormous optimism in what we heard. There is a growing
view that now is the time to act if the industry is to meet the
IMO's ambition. Shipping executives noted that to reach it, the
first net-zero vessels will need to enter the global fleet by around
2030 - something that has also been recognised through the goals of
to Zero Coalition. This creates a real sense of urgency.
By recognising that all of us in the shipping industry were
facing many of the same blockers, we were able to explore potential
solutions, with different organisations contributing different
pieces of the puzzle. Through this process, 12 solutions were
identified with five of those prioritised as the most critical to
unlocking progress in the short-term:
- Scale-up customer demand: Create scale in demand for low
or zero-emission shipping through charterers' and customers'
commitments that include long-term contracts and green procurement
criteria. Natural candidates to lead this solution are state-owned
and publicly listed companies with proximity to end consumers (e.g.
containers, food bulk) and others with ambitious scope 2 and 3 net
carbon footprint commitments.
- Global regulatory alignment: Create a level playing field
globally and reduce uncertainty regarding regulations and
timeframes. New IMO guidelines due in 2023 should provide clarity
and should be aligned with leading local and regional regulatory
bodies (eg. EU, China and US). Short-term regulatory incentives
should also be considered.
- Cross-sector research and development: Intensify
partnerships to develop zero or low-emission fuels through joint
research and development (R&D) across shipping, other
harder-to-abate sectors and the energy industry. Create a much
larger pool of capital and expertise to evolve new technologies and
increase the likelihood that production and transportation
infrastructure will be available once future fuels are commercially
- Scale-up controlled pilot projects: Increase R&D
effectiveness by running end-to-end green pilot projects involving
customers, charterers, operators, owners and ports on specific
routes and vessel types. Operators that follow a predetermined
schedule, such as container ships especially on shorter and busier
routes, are likely candidates for pilot projects.
Underpinning all of the solutions is operational efficiency.
Particularly when the lifespan of a ship is 20-30 years, operational
improvements to reduce the emissions of the current fleet are
critical if we are going to meet the IMO's ambitions for 2050.
Whichever pathway to decarbonisation the sector chooses, efficiency
is on the critical path to success. Which makes the talks this week
all the more pressing.
- Coordinated industry commitments: Increase the reach of
existing initiatives - such as the Getting to Zero Coalition, Clean
Cargo Working Group and others - by consolidating objectives and
strengthening the coordination of various concurrent workstreams. A
body with a specific mandate, formed with dues from the industry,
could accelerate the shift from ideas to action and help break the
But while efficiencies and the five priority solutions should
unlock progress, they are only the first step on the road to
net-zero emission vessels and decarbonisation. The industry
identified a further six actions that will be needed to build on
these between now and 2030.
Roadmap to 2030
Developing and scaling any of these solutions will require
unprecedented collaboration between a broad and diverse group across
shipping. Not only are the traditional ship owners, operators and
regulators needed, but in many cases the customers, ports,
financiers and others also need to play important roles.
And there is little time to lose. As conversations like this
week's at the IMO gain momentum and we get closer to the critical
milestones of 2023, 2030, and 2050, the conditions are emerging for
fundamental change for the industry. It is vital that shipping is
positioned to succeed in this. Not just by working with regulators
to develop practical strategies for our industry, but by being bold
and ambitious about what we can achieve together.
This research has been an opportunity to listen to each other
and reflect. It shows that many of us in shipping are facing the
same barriers, pressures, and risks. It is clear that the
transformation of shipping is going to be complex and will require
time and significant resources. But this roadmap begins to set out a
practical pathway towards decarbonisation that we can work on
together. We must all be prepared to take difficult decisions on
this to accelerate progress towards a net zero industry.
Download the report here
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