Indian Transport & Logistics

WSC outlines 6 pronged strategy to IMO to meet zero carbon shipping goal

The paper recommends 'green corridors' as a practical mechanism for the IMO, member states, and industry to focus investments in a manner that enables compliance with a given set of regulations.

WSC outlines 6 pronged strategy to IMO to meet zero carbon shipping goal
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February 14, 2022: A detailed six pronged strategy to transition to decarbonise and reduce GHG emissions from ships has been recommended by the World Shipping Council (WSC) as the way forward for the International Maritime Organization (IMO) to pave the way for the shipping industry to achieve its zero carbon emissions goal.

WSC, which is a Washington, D.C.-based trade association representing international liner shipping, has submitted a paper in February to IMO's MEPC titled 'Reduction of GHG Emissions from ships'. The paper examines the current regulatory and economic elements that are critical to IMO's GHG Strategy going forward and expands on six core regulatory and economic elements to meet the zero GHG emissions in 2050 goal set by the industry.

The IMO is engaged in an unprecedented effort to accelerate a major fuel and technology transition in response to the climate challenge. This comes amidst the backdrop of many member states and organisations calling for the world's fleet to reach zero GHG emissions in 2050.

The six core regulatory and economic elements include:

Applied R&D for shipboard and shoreside systems

Applied R&D and development of onboard engineering systems that allow the safe use of zero GHG fuels will become necessary for putting zero GHG ships on the water. Similar work is also necessary on the shore-to-ship transfer of advanced zero-GHG fuels that present innovation challenges due to their highly toxic, corrosive, and/or explosive characteristics. Technology Readiness Levels (TRLs) need to be raised to enable the delivery and operation of thousands of zero-carbon ships, as opposed to just a handful of prototypes.

Global application of a carbon price (GHG price)

While many studies undertaken to date conclude that low and zero GHG fuels will cost substantially more than conventional fuel oil. Considering this, the ability of companies to put zero GHG ships on the water and to operate them competitively (among a fleet of ships with dramatically lower fuel costs) requires establishment of a carbon price that effectively levels the playing field among newer low and zero GHG ships and the tens of thousands of ships that will still be burning fuels with significant GHG emissions.

Alternatively, or in combination with an established carbon price, programmes that explicitly 'buy-down' the cost of specific zero GHG fuels will likely be necessary. However, the paper mentions that these programmes will require a dependable and broad-based programme to be effective.

Life cycle fuel accounting with appropriate regulatory mechanisms for first-movers

To meet the challenge and to encourage first-movers to deploy ships using fuels with the greatest potential to reduce and eliminate GHG emissions, WSC has invited the Marine Environment Protection Committee (MEPC) in IMO, to develop an LCA(Life Cycle Assessment) process that examines GHG emissions across the full well-to-wake life cycle, aid breaking out well-to-tank emissions from tank-to-wake emissions to distinguish emissions from combustion from those generated upstream. Further, it calls on MEPC to develop specific regulatory provisions that incentivize first movers in using among others, hydrogen-based fuels (including ammonia). This should not exclude lower carbon fuels produced through brown/blue processes, which may be needed in the shorter term if green fuels are not yet available through renewable energy sources.

Integrated development of global production and supply of zero GHG fuels

The paper states that the demand in the maritime sector alone is insufficient for suppliers to make large investments tailored to supplying the maritime sector with alternative fuels alone. Supply investments to produce zero-GHG fuels through renewable energy sources will be essential as we look to zero GHG fuels.

It recommends coordinated partnerships between member states and energy providers that are specifically designed to invest in new low and zero-GHG fuel production that includes specific provisions for key supply points in the commercial maritime sector Further it recommends that regulatory provisions should allow for certain flexibility in the initial stages of a major energy transition as low and zero GHG fuels will not be available at the same time around the globe.

Green Corridors as enabler of the fuel/technology transition

Green corridors can provide a realistic vehicle to introduce zero GHG ships and fuels across trade lane(s) where the necessary shoreside energy infrastructure is first introduced. The paper cites that 'green corridors' also offer a practical mechanism for the IMO, Member States, and interested parties to focus investments in a manner that enables compliance with a given set of regulations. These can only become real through government-to government initiatives and coordinated public-private investments to build the necessary production facilities and supply infrastructure. This could be a critical pathway to create an environment where compliance with a given regulatory standard is feasible.

The paper also cites a recommendation to develop a realistic "buy-down" programme for the use of zero GHG fuels over a given timeframe. This will aid the transition period (which will likely require two to three decades) where the cost of hydrogen-based fuels and other near-zero GHG fuels produced through renewable energy sources are expected to cost far more than fuels available in the market today, cited the paper.

New build standards that support the energy transition

The paper recommends IMO to consider requiring ships to be built on or after a specific date to be capable of operating on a defined suite of zero GHG fuels or alternatively no longer allow construction of ships that can operate on fossil fuels alone after a specific date. The necessary technologies to use these fuels should meet a TRL 8 or 9 standard of readiness five years prior to the designated new-build requirement, and that sufficient fuel production and infrastructure is in place at key locations to enable use of these ships and a review to confirm the availability of low-sulphur fuel oil should also be undertaken for the same.

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