Big COP Commitments to Green the Shipping Sector

Big COP Commitments to Green the Shipping Sector

Heavy shipping is a huge industry -- about 80% of the world’s total trade moves over sea -- which means it is responsible for a huge amount of emissions. Shipping represents 3% of annual global emissions. If it were a country, the industry would be the eighth largest emitter on the planet. In an effort to align the sector with the Paris Agreement goal to limit warming to below 1.5 degrees Celsius, the US, Norway, and a number of leading companies organized a "Green Shipping Challenge” at COP27.

ShareAmerica: COP27 | Green Shipping Challenge, November 3, 2022.

So far, over 40 ports, companies, and states have signed onto the challenge. Each signatory has made at least one major announcement about a project they plan to undertake to reduce their carbon footprints, such as moving to low-emissions fuels or promoting policies that make it easier to switch to cleaner cargo ships. The Inflation Reduction Act (IRA) includes a new $3 billion rebate and grant program at the Environmental Protection Agency to provide funding for zero-emission port equipment or technology, and the United States is working with countries in the International Maritime Organization (IMO) to phase out greenhouse gas emissions from international shipping to reach zero by no later than 2050.

DW: Infrared footage shows 'green' ships leaking methane into the atmosphere, April 13, 2022.

Financial Times: The cost of greener shipping, March 21, 2022.

DW: The true cost of shipping basically everything, November 12, 2021.

Why This Matters

The UN Emissions Gap report released at the end of last month revealed that the emissions reduction commitments each country has made are not enough to prevent the worst effects of climate change. Instead, the world is on an alarming trajectory -- based on current targets, we will see temperatures rise 2.5 degrees Celsius above pre-industrial levels by the end of the century. The last eight years have been hotter than ever.

The shipping sector isn’t just fueling temperature rise. It’s experiencing the consequences of it, too -- climate change places the very existence of the global shipping industry in jeopardy. Destructive storms, floods, and rising sea levels could damage port infrastructure to the tune of $10 billion a year by 2050. By 2100, losses are expected to rise to over $25 billion a year, a figure higher than the annual total operating profits for the entire global container shipping industry.

The Green Shipping Challenge is a meaningful step towards making the shipping industry more eco-friendly and resilient, but it is a beginning, not an endpoint. Faig Abbasov, Shipping Programme Director at the European clean transport campaign group Transport & Environment, told DW:

We're glad to see this kind of leadership from the United States that's keeping this issue high on the agenda. But for that challenge to become reality, the US needs to seriously consider implementing domestic legislation on international shipping to create a market for clean technologies.

TED: The Carbonless Fuel That Could Change How We Ship Goods | Maria Galluci, March 22, 2022.

The Race To Find Solutions

Among the biggest challenges to reduce the shipping industry’s carbon footprint is transitioning to cleaner fuel sources. But this is no easy task -- 99% of shipping is currently powered by fossil fuels, which have enough horsepower to carry heavy ships across long distances.

Although the industry has indicated an intent to reach net-zero by 2050, decarbonization is going to be expensive. The total cost, industry-wide, is estimated to amount to between $1 trillion and $1.4 trillion. Because of this, as DW writes: “Analysts gaming out a range of ‘plausible long-term economic and energy scenarios’ say emissions could first rise by as much as 130% over 2008.”

One potential source of fuel is biomethanol, which can be synthesized from large biomasses like agricultural waste. Copenhagen-based container shipper Maersk, for example, has ordered 19 new ships with methanol-fueled engines in an ambitious effort to reach net-zero emissions by 2040. Amazon, a founding member of the First Movers Coalition, announced a commitment to use ships with zero-emission fuels for at least 10% of goods shipped internationally by 2030 and 100% by 2040.

Bloomberg: How the Dirtiest Ships Are Cleaning Up Their Act, March 8, 2022.

Maersk: Maersk | Next Generation of Maersk Container Vessels Designed for Green Methanol, December 8, 2021.

MAN Energy Solutions: Future fuels | Methanol in maritime shipping, December 13, 2021.

Another greener fuel option -- favored by Japan-based shipping companies -- is ammonia. A report from the International Energy Agency (IEA) found that hydrogen-based fuels like ammonia should account for 30% of maritime fuel across the sector in order to reach net-zero emissions by 2050. Ammonia is easier to store and safer to transport than other hydrogen-based fuel, but it also has a major drawback: it’s highly toxic to both humans and animals.

While the quest to find more eco-friendly fuel for cargo ships has been -- and will continue to be -- a difficult process, Brian Østergaard Sørensen, head of research and development at MAN Energy Solutions, has an optimistic outlook: "We are looking at a difficult transition [to cleaner fuels], but there is a willingness to do this. For us, the payoff is that our technology will be future-proof.”

Euronews: How the shipping industry is betting on ammonia as part of a cleaner energy mix, November 7, 2022.

Sustainability Magazine: Green Shipping | Can We Get There? | Øistein Jensen (Odfjell SE), September 13, 2022.