Shipping touches pervasively but unobtrusively on every aspect of our daily lives; from the clothes we wear, to the food we eat, to the goods we order online. But rarely do we think about the negative environmental ramifications caused by it. These environmental impacts include air pollution, water pollution, noise, and oil pollution. Greenhouse gas emissions from shipping currently represent 2.6% of total global emissions, equivalent to those generated by South Korea. The International Maritime Organisation (IMO) estimates that carbon dioxide emissions from shipping are expected to rise by between 50-250% by 2050 if no action is taken.
There are several drivers contributing to increased efforts to decarbonise. The maritime industry is facing a twinned challenge of a global rise in fuel prices combined with tighter environmental regulations. The IMO announced in 2018 the objective to “reduce the total annual GHG emissions by at least 50% by 2050 compared to 2008, while, at the same time, pursuing efforts towards phasing them out entirely”. Additionally, the IMO’s global sulphur cap comes into play from 2020, substantially lowering the current 3.5% limit to 0.5% and enforcing cleaner shipping. Consumer demands, reputation concerns, and pressures from NGOs and investors are also increasing the demand for greener shipping.
Decarbonisation is the key challenge for this industry; however, the design, operation, and maintenance of shipping is built to suit the fossil fuel ‘paradigm’. Deployment of all currently known technologies could make it possible to completely decarbonise by 2035. But how are we going to get there? There is no silver bullet technology that can make the transition easy and effortless. Instead, a wide variety of technologies are needed. Innovation is necessary and vital.
Whilst shipping is the least carbon intensive way to move freight, the industry is highly reliant on outdated technology. This presents a huge energy efficiency opportunity for ships, start-ups and investors. Zero-Emission vessels (ZEVs) are needed in order to meet the IMO’s targets and contribute to meeting the goal of the Paris agreement. There are 3 broad solution areas through which decarbonisation can be achieved; technological, operational, and alternative fuels/ energy. The largest emission reductions are likely to come from alternative fuels/ energy.
Technological solutions involve improving the weight and design of ships, reducing friction, and energy recovery e.g. via propeller upgrades or heat recovery. Potential fuel savings arising from air lubrication and hull surface technologies alone could be 2-9%. For example, in this space, graphene is being innovatively used to reduce biofouling, increase the longevity of boat hulls, and decrease friction. Furthermore, many of these solutions are already available on the market and can be retrofitted.
Operational measures involve speed, ship-port interfaces, ship size, and onshore power. Multiple start-ups are specialising in this area; creating digital twins (such as We4Sea), data driven cloud platforms and using AI for predictive analytics to optimize operational performance (such as nauticAi).
Alternative ZEV technologies include ammonia fuel cells, ammonia + internal combustion engine (ICE), biofuel, electric batteries, hybrid hydrogen, hydrogen fuel cells, and hydrogen + ICE. It is crucial to ensure that these fuels are not simply moving the GHG problem upstream, as there may be emissions that arise through their production. However, future CO₂ emission reductions from certain alternative fuels could be 100% if produced by renewable energy sources. Not all of the alternative fuels have reached market maturity, and most are still in a research and development phase. There are also issues regarding safety, cost, availability, and sustainability. It is likely, however, that the costs could all reduce significantly in the future. Two of the most likely routes to shipping decarbonisation come from the use of biodiesel and the use of ammonia, based on zero-carbon hydrogen. In the near term, novel wing sail systems, such as those developed by Bound4Blue, are already making a splash with serious potential to reduce fuel consumption.
The maritime industry is not without its risks for start-ups. There are high barriers to entry, and significant levels of skills, experience, knowledge and capital are essential. Information asymmetry, split incentives, and the fragmented nature of the industry are not easy obstacles to overcome. Climate change is opening up the Arctic, international trade will continue to grow and the demand for shipping will increase. The scale and value of this opportunity must not be ignored or hidden by ‘sea blindness’. This is an exciting time for innovative technologies companies who can play a critical and key role in decarbonisation.