Thirty leaders in the shipping sectors – including cargo owners, ship operators, ports, bunkering companies, and equipment manufacturers – on Wednesday (6 December) signed a Joint Commitment, organised by the UN High Level Champions and RMI, at COP28 to enable the use of renewable hydrogen-derived shipping fuel this decade to meet maritime industry decarbonisation targets. 

Signatories of the Joint Commitment include Bunker Holding Group, Maersk, Mitsui O.S.K. Lines,  WinGD, X-Press Feeders, Trafigura and MAN Energy Solutions. 

The Commitment includes important targets for fuel use, fleet development, and port infrastructure needed to get the nascent green hydrogen industry to scale.  

To reach targets set out in the International Maritime Organization (IMO)’s 2023 Strategy, adopted by 175 member states earlier this year, the average ship’s greenhouse gas intensity will need to be reduced by 86% by 2040. Achieving this requires large-scale and rapid growth in the use of zero or near zero-emission fuels, of which green hydrogen-derived fuels like ammonia and methanol will play a crucial role. Legally binding international regulations that enter into force in 2027 will require the use of low-emissions fuels. 

Ports and ports’ enablers have added their support for the Call to Action, committing to invest in infrastructure and safety projects to support re-fueling of ships with green hydrogen and its derivatives. 

Rasmus Bach Nielsen, Global Head of Fuel Decarbonisation for Trafigura, said: “We will only achieve the deep decarbonisation of shipping by switching to zero-emission fuels derived from renewable-based hydrogen.  As one of the world’s largest charterers of vessels, the commitments we are making alongside others should encourage investment by ports and port enablers serving shipping routes to invest in the necessary infrastructure. This in turn will help further incentivize the production of green hydrogen and hydrogen-derived fuels for use in shipping.” 

Keld R. Demant, CEO of Bunker Holding Group, said: “As the world’s largest bunker supplier, Bunker Holding Group fully supports the IMO GHG Strategy for decarbonising the shipping industry. We contribute by partnering with alternative fuel producers, and handle trades and logistics related to the last mile delivery. But to succeed, all industry stakeholders along the value chain need to stand together.” 

“To stimulate the demand and supply of zero or near-zero fuels, IMO should adopt pricing incentives as well as requirements for alternative fuels. Regulatory insurance is a prerequisite for the necessary investment in production, infrastructure, and new vessels.”  

Equipment manufacturers also joined as signatories, committing to support research and development efforts to further green hydrogen-based fuel deployment in the maritime sector. 

Uwe Lauber, CEO of MAN Energy Solutions, said: “Regardless of what other future-fuels eventually come into play, green hydrogen and green fuels derived from it will undoubtedly play a major role in all scenarios. At MAN Energy Solutions, we strongly believe that shipping is the ideal enabler for a hydrogen ramp-up, consuming as it does around 300 million tons of conventional fuels annually.”

 “Currently, our subsidiary – H-TEC SYSTEMS – is building a manufacturing facility for PEM electrolysis stacks for green hydrogen, which will add to the necessary scaling and market for zero-emission fuels. We are happy to add our voice to the growing alliance pushing for marine decarbonisation.” 

Takeshi Hashimoto, CEO at Mitsui O.S.K Lines, Ltd. (MOL), said: “For a general shipping company such as MOL, there is no single solution for vessel fuel. We will promote the adoption of optimum fuels including hydrogen, ammonia and any other potential green fuels for each business on the premise of achieving net zero in 2050 and our interim milestones.”

“In addition to working on the development and operation of vessels from the perspective of fuel users, we will work with diverse partners to urge upstream players of the fuel supply chain to join our efforts to expand the use of new fuels.”

As part of the Commitment, green hydrogen producers agreed to produce 11 million tons of the low-emissions fuel for use by the shipping sector by 2030. Longer term, a decarbonised global shipping sector will become one of the largest demand sources for green hydrogen, projected to account for approximately 15 percent of total demand by 2050.  

Alex Hewitt, CEO of CWP and chair of the Green Hydrogen Catapult, said: “In the mission to decarbonise shipping using green hydrogen and derivatives, global collaboration is key. This statement highlights the need for all participants across the value chain to collaborate deeply on both the supply and demand sides. We’re not building big green energy projects; we’re catalyzing change. It’s time for a determined step forward to foster projects that go well beyond current thinking on scale and get us straight onto the scale up fast track.”

To meet growing demand and enable decarbonised vessels, fuel supply and infrastructure must be present at ports on both sides of shipping routes, a fact that will require significant international coordination and investment.  

Sam Cho, Port of Seattle Commission President, said: “In the Pacific Northwest, we are actively working with our industry partners to catalyse development of a regional market for zero emissions fuels. We see green hydrogen as having significant potential to decarbonise maritime.”

“Green corridors focusing on cruise to Alaska and cargo with the Republic of Korea are already underway. A critical next step is to look beyond our own port, and to ensure that our strategies align with future planning and investment in fuel supply in our region and around the world.” 

Signatories called on governments to follow suit and support private sector collaboration with ambitious fuel standards and clean fuel mandates. To date, 41 governments have formulated national hydrogen strategies, many of which specifically address the shipping sector. Further action is needed to align and commit to well-to-wake emissions accounting, creating an enabling policy environment for verifiable low-emissions fuels. 

“In support of our collective actions we call on the IMO and member States to adopt a GHG pricing mechanism, a levy, as the most appropriate mechanism to achieve a just and equitable transition, among other measures. Collective action and cross sector cooperation is vital to make sure that shipping’s zero emission transition happens smoothly and quickly,” Nielsen at Trafigura said. 

Note: The Joint Commitment document can be viewed here.

Photo credit: Chris Pagan on Unsplash
Published: 7 December, 2023