The shipping industry drives global trade and has long helped to accelerate the growth of maritime hubs like Singapore. The Lion City is the busiest container transhipment port globally and is consistently ranked as the world’s leading port, and top maritime centre, by the Xinhua-Baltic index.
Vital role in economies
Yet, while shipping continues to be vital to economies worldwide, there is an urgent need for the industry to reduce its carbon footprint. Shipping accounts for close to 3 per cent of global carbon dioxide (CO2) emissions every year. If the industry was a country, it would be the world’s sixth biggest CO2 emitter. Recent estimates note that shipping uses about 300 million tonnes of oil to produce 12.6 exajoules of energy, releasing more than one gigatonne of greenhouse gas emissions.
While the International Maritime Organisation (IMO) has a deadline of 2050 to cut CO2 emissions from shipping by 50 per cent from 2008 levels, the stark reality is that the industry lacks a clear plan on how to achieve this.
Consensus on the best zero-carbon fuel source for large cargo vessels remains elusive, with hydrogen, methanol, ammonia and electrification all being considered as possible alternatives.
Key shipping markets
In the meantime, liquified natural gas (LNG) is a commercially available fuel that is now well-established within key shipping markets, including Singapore, as an important stepping stone for an industry with a significant emissions challenge.
Seaborne trade accounts for 80 per cent of global trade. Shipping, by its nature, is a highly fragmented industry: it is estimated that the top ten shipping companies contribute less than 20 per cent of total capacity globally. Likewise, given that vessels depend on their host nations for fuel supply, they are subject to the energy policies of individual markets.
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Source: The Business Times