The following is an article written by Simon Potter, Director of Sustainability Advisory to marine engineering consultancy Houlder elaborating the importance of the shipping industry to focus on both clean technologies and future fuels to meet CII, impact the existing fleet now, and ensure less energy-dense future fuels get a helping hand. The article was shared with Singapore-based bunkering publication Manifold Times:
Carbon Intensity Indicator
The shipping industry is witnessing a period of deeply impacting regulation that will require major investment and technological innovation. For example, the International Maritime Organization’s (IMO) Carbon Intensity Indicator (CII) regulations coming into effect in January 2023, will have a significant impact on owners, operators and maritime operations more broadly.
There is a real and present risk of unintended consequences emerging from the implementation of CII. The new regulations may encourage the majority of the industry to do little but slow steam and wait for alternative fuels to emerge at scale, rather than invest in the plethora of innovative, commercially ready clean technologies.
While slow steaming to reduce fuel use is better than not acting at all, it is a pessimistic approach. Strategies such as slowing steaming reduce the capacity of the existing fleet, making the challenge of vessel replacement even bigger as worldwide cargo demand continues to grow. Perversely these strategies themselves make the need for energy efficiency and renewable and sustainable propulsion (clean) technology even more important; if the global fleet needs to grow, so too will greenhouse gas emissions.
It is important that owners and operators do not continue to overlook the ‘quick wins’ – especially to the current fleet – that clean technology represents. The existing global fleet is worth over $1 trillion and therefore must not be ignored. A big chunk of that cost sits on bank balance sheets, which constitutes significant risk if these assets are not managed properly through the industry’s decarbonisation.
Shipowners need to integrate available clean technologies into their roadmap to immediately drop emissions and fuel consumption while alternative fuels continue to scale up. This also offers the current fleet an opportunity to keep pace with the rapidly accelerating environmental objectives coming from regulators, the market and the end consumer.
A package of solutions
When looking at clean technology and new fuels, It’s not a question of choosing one over the other. Clean technologies will complement low and zero carbon fuels, and we need them to create the zero-carbon ship of the future and to reduce costs in the short term and long term.
We already have a huge range of options that complement future fuels and reduce carbon emissions. These include wind propulsion, air lubrication, battery energy storage, hull coating technology, hydrodynamic energy saving devices, and voyage optimisation software, to name a few.
At Houlder, we believe there is no single best energy efficiency solution for CII compliance or for shipowners looking to proactively control their own decarbonisation agenda. There are a multitude of clean technologies that can be deployed today, but it is critically important to determine how they can be packaged together for the greatest effect and to achieve the best return on investment.
It is important to research your options in detail. For example, North Star Shipping (NSS) commissioned a comprehensive study to help develop of a greenhouse gas reduction strategy across its fleet of over 40 vessels. An expert team first established the greenhouse gas emissions and carbon intensity of the current fleet and its operations before identifying the most suitable technologies and operational measures to reduce carbon emissions. This includes defining the cost, benefits and timeline for implementation of these technologies.
Every drop counts
It becomes increasingly clear that all low and zero-carbon alternative fuels will be more expensive and less energy-dense than current oil-based fuels – meaning the unequivocal rationale for investment in clean technologies only strengthens further. Any technology that can improve fuel efficiency and can make less potent fuels go further is a valuable asset.
Regulation may be setting milestones in the shipping industry’s decarbonisation journey, but the damage done by our carbon emissions is cumulative and won’t be reversed by future fuels. The reality is that most new fuels will not be residual, commoditised products for decades – especially for smaller ship owners and operators – and waiting is not an option. Every drop of fuel saved right now matters, and all measures taken now to reduce emissions through clean technologies provide owners with a more optimised path forward towards full decarbonisation in the future.
Effective decarbonisation strategies must encompass widespread considerations from regulatory requirements and environmental and social governance to green financing, naval architecture and engineering. What’s clear is that adopting the right clean technology today – in combination with an alternative fuels strategy – makes commercial and environmental sense.
Photo credit: Houlder
Published: 30 September, 2022
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