Growing partnerships which drive shipping’s decarbonisation, an expanding role for the IMO, creating security for investments and striving for short-term improvements were the focus of shipping at this year’s COP climate summit.
Opportunity And Challenges
But there is still much work to do. Adoption of future fuels remains in the early stages, with 98.8% of the fleet still sailing on fossil fuels, whilst 21% of vessels on order have the potential to operate on cleaner alternatives according to UNCTAD in their Review of Maritime Transport 2023. Whilst shipping was not directly referenced in the official COP agreement the text did highlight the need for sectors to accelerate “renewables, nuclear, abatement and removal technologies such as carbon capture and utilization and storage, particularly in hard-to-abate sectors, and low-carbon hydrogen production.” The maritime industry’s outlook has shifted significantly. Shipping maintains the lowest CO2 per tonne per mile and the industry is eager to maintain this mantle as other transport sectors decarbonise. COP28 showed shipping is striving for investment, to seize the opportunities presented by the energy transition.
Take the Green Shipping Challenge. Countries, ports, and companies made more than 60 major announcements or updates to announcements on issues ranging from new green shipping corridors; to integration of new zero and near-zero emission fuels and technologies; new training frameworks for seafarers on new maritime fuels; and supporting the overall implementation of the 2023 IMO GHG Strategy long-term goal and indicative checkpoints.
Partnership Is Key
But what can partnerships look like in practice? Take the Castor Initiative, a project namechecked multiple times by Capt. Rajalingam Subramaniam, President and Group CEO of MISC at the International Chamber of Shipping’s Shaping the Future of Shipping summit
The global coalition, which includes MISC Berhad, Lloyd’s Register, Samsung Heavy Industries, MAN Energy Solutions, the Maritime and Port Authority of Singapore, Yara Clean Ammonia, TotalEnergies and Jurong Port, was established in January 2020 to develop an ammonia-fuelled tanker design. “We are on track to getting these first deep sea, zero emissions ships into the water with regular repetition from 2026 onwards,” according to Nick Brown, CEO of Lloyd’s Register. For Capt. Raja, bringing onboard the financiers is the next step for the partnership. This is something which the Lloyd’s Register Maritime Decarbonisation Hub has already achieved with The Silk Alliance.
The current membership of The Silk Alliance comprises stakeholders across the entire value chain of shipping, involving both private and public organizations, including two financial institutions. The Silk Alliance was also recognised by the Green Shipping Initiative for identifying its first baseline fleet for Singapore Cluster and calls for further collaborators. Also heavily on the agenda of COP28 was the importance of people to the transition, and the need to ensure that any transition is just and equitable.
That’s why at COP28, the Maritime Just Transition Task Force announced the next phase of the partnership. A new training framework, funded through the International Maritime Organization and Lloyd’s Register Foundation and developed by Lloyd’s Register, will equip seafarers with skills in decarbonization, and provide guidance for trainers and the industry.
Future Role Of IMO
Setting aside the key announcements and the view of the industry, another important and interesting development clearly articulated at COP28 was the potential future and role for the IMO. Nobody attending COP28 can be anything but certain about the charisma of the IMO Secretary General-elect Arsenio Dominguez, but we left much clearer on what he sees as the future of the IMO. The direction there is clear: a greater role for the IMO as a facilitator to other sectors and ministers beyond shipping.
In many remarks throughout COP, Dominguez outlined the difficulties that lie ahead. Maritime, for many governments, is a small section of their decarbonisation efforts with many shipping ministers struggling to make it into the COP28 country delegations. Instead, those spots were often reserved for environment and energy ministers.
“I spent nearly 20 years in a government, and I have seen how fragmented we were,” Dominguez told delegates at the International Chamber of Shipping’s Shaping the Future of Shipping summit. “We organized an IMO event for the launch of the strategy, we invited energy ministries as well as shipping ones. This [talking to Governments beyond shipping ministries] is already happening.”
It’s a situation mimicked in industry as well: the competition with other industries for the reliable supply of future fuels. But it is not just in facilitating cross-government and sector communication that the IMO sees its future but broad agreement that we need more regulations from the IMO, so long as they are the right frameworks. Throughout COP28, at panel after panel, we heard the same age-old question: what would shipping’s reaction be to more regulation? Time and time again, we heard the great and the good of shipping telling us that more regulation from the IMO, regulations that were well created, which provided frameworks and certainty but did not block entrepreneurship were vital for the future.
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Source: Lloyd’s Register
