A step by global shippers towards decarbonisation

Shipping generates 3 percent of global carbon emissions (300 million tons of CO2) and based on its current trajectory, shipping volumes are set to increase by about 1.3 percent on an average annually between now and 2050. Our world today is going through extraordinary change. There are significant challenges, from the longer-term effects of climate change to the immediate shock and uncertainty of the global pandemic.

As industries become more mindful of sustainability issues, it is time for the shipping sector to do its part in creating a sustainable future. It is not only the responsible thing to do but also an opportunity for shipping leaders to build a lasting legacy by helping address one of the world’s major problems.

One of the greatest examples is The Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping, established in 2021. It acts as a research institute dedicated to decarbonizing the maritime industry. The Center aims to bring together stakeholders and partners from the public and private sectors to collaborate on identifying, demonstrating, and maturing zero-carbon solutions.

They have developed the NavigaTE model. It analyzes the total cost of ownership for different ship-efficiency technologies and alternative fuels based on industry inputs and cost forecasts, along with the impact of the varying customer, financial sector, and regulatory interventions.

The IMO’s ambition is to reduce the shipping industry’s greenhouse-gas emissions by at least 50% by 2050 and to reduce the carbon intensity of emissions by 40% by 2030 and 70% by 2050, compared to 2008 levels. The urgency is apparent, but the cost of achieving this will be high. The total cost of decarbonization has been estimated at $1.65 trillion by 2050.

Demand – driven approach can help in scaling up!

Multiple stakeholders can contribute to the overall reduction of carbon footprints. The shippers and manufacturers of the goods can clearly state their demands for sustainable services in advance. The carriers and other service providers can then plan accordingly to source and build a network for the provision of green services. The lack of scale often results in the rejection of these green solutions like bio-diesel, green warehousing, solar energy, green-equipments, electric vehiclesetc. An approach driven by demand can transform this for better. Infrastructure can be built and resources can be gathered if the shippers are ready to choose and plan to invest.

Standardizations like Sustainable Aviation Fuel Certificate , can create a framework for continuous and clear demand. The adoption of green services at mass can be done by change of policies as well as by incentivising the initiatives. Cross- industry collaborations can be one of the ways for proliferating the adoption of green solutions. Carriers and shippers need to calculate and share the emission levels generated while shipping their goods.This can create a transparent system for choosing more mindful options.

The shipping and logistics sector has a huge potential to transition into a decarbonised one. Stakeholders at every level of the supply chain can offer their part to reduce cost and generate demand for green solutions.

Contributed by :- G V S K Vedant, Sales, Hyderabad, 20Cube Logistics.