The latest ABS Low Carbon Outlook discusses the impact of the energy transition on supply chains and vessel operations, writes Pantelis Skinitis, Director, Global Sustainability, ABS.
The maritime industry is heading towards a technological revolution driven by decarbonization. Powered by improved collaboration and propelled by developments in clean energy, digitalization and applied research, this future will offer greater sustainability and much higher efficiency.
Rather than simply adapting to the green energy transition, the maritime industry is also actively influencing it. The shipping, ports and logistics sectors are propelling the global shift toward sustainable energy solutions by shipping these critical elements: carbon, ammonia and hydrogen.
These and other issues are examined in detail in the latest update to the ABS Low Carbon Outlook series which discusses the impact of decarbonization in a global context and examines potential solutions.
The transition to greener technologies may incur initial expenses, but long-term operations will benefit from reduced fuel use. Additionally, safety measures will need to evolve, especially when considering the characteristics of the alternative fuels being currently considered by the marine industry. For example, ammonia is one of the alternative fuels currently being considered, and it has unique handling and storage requirements.
Fuels and Energy
On the other hand, the global energy market is at a crossroad. With rising energy consumption to meet consumer demands and a pressing need to simultaneously reduce carbon footprints, there is a definitive shift toward renewable and low-carbon energy sources.
ABS carried out extensive research in support of the updated publication to evaluate the potential effects of using alternative, low-carbon fuels in the shipping industry, including as updated fuel mix forecast.
Based on extensive research and the most current information from Q3 2023, we looked at different scenarios up to 2050 and their effect on the forecasted fuel mix. Another layer of complexity in the equation is the current geopolitical events that impact the future fuel mix.
The 2023 IMO Strategy on Reduction of GHG Emissions from Ships (the 2023 IMO GHG Strategy) reaffirmed the IMO's commitment to accelerating the reduction of GHG emissions from maritime activities and established the ambitious goal of achieving “net-zero” GHG emissions by or around 2050.
The 2023 International Maritime Organisation greenhouse gas strategy, as revised at the 80th meeting of the Marine Environment Protection Committee, will lead to significant changes. Vessels will need to switch from traditional fuels to greener alternatives, which might involve engine upgrades and the development of new fueling infrastructure. Improved energy efficiency measures, such as improved hull designs and operational changes will be essential.
Additionally, vessels may need to be equipped with real-time emission monitoring and reporting systems, which will require crew training for effective implementation and compliance. Older ships may also see challenges with retrofitting, thus rendering them commercially less attractive. However, new, complying ships might see an increase in market value.
A low emission future
The transportation of carbon, ammonia and hydrogen as cargoes highlights the industry's significance in bridging the global energy landscape's gaps between production, storage and consumption.
As the maritime industry looks ahead and dives deeper into the complexities of these three value chains, it becomes clear that shipping is more than a spectator in the global green energy revolution. Instead, it serves as a critical facilitator and enabler.
While energy efficiency technologies provide a practical and realistic pathway to improve ship operational efficiency and thus reduce carbon emissions, they’re expected to play a broadly supportive role in the majority of decarbonization projects. Onboard carbon capture, while still in its early stages of development, has the potential to transform the way industry manages carbon emissions.
The carbon value chain — which includes core elements of capture, utilization, storage and transportation — is an integrated step for carbon emissions reduction, from source to potential utilization or sequestration. The maritime industry can support carbon capture activities worldwide by providing safe and efficient transportation, thereby assisting in efforts to reach a carbon-neutral future.
Ships built to transport liquid carbon as cargo are emerging; these vessels ensure that liquid carbon is transported safely and efficiently from capture sites to utilization or storage facilities.
Understanding and improving the carbon value chain will become increasingly important as the entire global economy steps up its efforts to combat climate change. The maritime industry, which accounts for a substantial portion of global trade will be at the centre of making this value chain a reality.
* Director, Global Sustainability, ABS