When one of the largest container service providers ordered a series of new ships recently, it was another significant contribution to the world fleet’s decarbonisation process. The alternative fuel selected for these newbuildings was methanol, which is proving a popular choice among shipowners seeking to reduce their vessels’ carbon emissions.

Earlier this year Ocean Network Express (ONE) ordered a series of twelve 13,000 teu container ships from two Chinese shipbuilders for delivery in 2027 and 2028. These were described in a press release as the inaugural fleet of methanol dual-fuel ships intended to contribute to the company’s sustainability goals “as part of the green strategy”.

Only a small proportion of the existing world merchant ship fleet – consisting of tankers, bulk carriers, container ships, gas carriers and other vessel types – is currently able to use alternative fuels or propulsion. But the proportion is growing and a much higher newbuilding order book percentage is now in this category.

What do the statistics show?

Measured by ship tonnage, about 7% of the entire world merchant ship fleet currently is able to use alternative fuels or propulsion. This share has increased from under 5% two years ago, and some estimates suggest it could reach 9-10% by 2026.

Focusing on the global merchant ship newbuilding orderbook percentage provides a clearer indication of how the industry is embracing the trend. According to data compiled by Clarksons Research, alternative fuels uptake has resulted in around half the current orderbook being comprised of newbuildings capable of using one of a wide range of alternatives.

The biggest part, 36% of the current orderbook, is ships set to use liquefied natural gas. Methanol is the second largest category with 9% of the total orderbook tonnage. The remainder is ships that will use liquefied petroleum gas (about 2%), while another 3% or so use other alternatives including hydrogen, ethane, ammonia, biofuels and battery/hybrid propulsion.

Progress towards sustainability goals is benefiting from other contributions. Energy saving technologies reduce fuel consumption and emissions. The Clarksons Research data also shows that a third (by tonnage) of the world’s existing merchant ship fleet on the water is fitted with one or more energy saving technologies including propellor ducts, rudder bulbs, flettner rotors, wind kites, air lubrication systems and other devices or systems.

Another significant feature is modern ‘eco’ vessels, designed to achieve the most economical fuel consumption, thereby also reducing emissions. These ships now comprise about a third of the present fleet, up by about six percentage points from two years ago.

The existential challenge

The figures for decarbonisation progress so far tend to confirm opinions among many industry observers. It has been frequently suggested that no single ‘obvious’ alternative fuel or propulsion that can be adopted to substitute for marine bunker fuel oil has yet emerged. Even after several years of intensifying discussion and almost obsessive albeit essential focus on this topic, the solution to this problem remains elusive: it is a conundrum.

Lack of clarity and uncertainty about several aspects has resulted is difficulties for investors in making decisions about ordering new ships or modifying existing vessels. Unanswered questions prevail about how the necessary technology will advance, future availability and pricing of many alternative fuels, the safety of seafarers and – crucially – what the future international regulatory regime will specify.

Indications of how trends in alternative fuel adoption could evolve over the longer term were provided by recent research conducted by classification society American Bureau of Shipping, published in a report last month. A “substantial and continuous transition in the maritime sector towards cleaner alternative fuels” is envisaged. The ABS calculations suggest that by 2050 traditional fossil fuel use could be reduced to a 15% market share, while methanol rises to 42% and ammonia to 33%.

Evidence contained in the fleet and newbuildings statistics confirms that the process of decarbonising the world fleet of merchant ships is under way. Another classification society, Lloyd’s Register, stated a few weeks ago that “the adoption of new environmentally friendly technologies in association with an increase in the maturity of the alternative fuels is slowly but gradually increasing as more governments declare their commitment to investing in port and bunkering infrastructure”.

These are useful perspectives and a focus for discussion and evaluation. But great uncertainty about what fuels and technology to embrace seems likely to persist during the period immediately ahead. Although the decarbonisation trend’s broad direction is visible, attempts to predict in more detail how an extended process stretching out over a quarter century up to 2050 will unfold is more difficult.

by Richard Scott FICS
Committee Member, London & South East Branch, Institute of Chartered Shipbrokers

Established in June 2020 by a strong group of global ship-owners and maritime suppliers under the umbrella of the International Marine Purchasing Association (IMPA), IMPA SAVE has been working with the industry’s best and brightest companies to bring knowledge of sustainable solutions to the maritime procurement sector. In this article, we engage with Mikael Karlsson, IMPA SAVE Chair and IMPA Special Ambassador for Sustainability, to learn exactly how IMPA SAVE has been slowly transforming the sector as we know it.

What is IMPA SAVE?

IMPA SAVE was started back in 2020 on a need for action and doing the right thing. It was formed by a handful of our industry’s sustainability frontrunners who had a keen interest in corporate responsibility and procurement with purpose, and continues to be steered nowadays by representatives of Northern Marine (myself), Maersk, Weco Shipping, Wilhelmsen Ship Management, Scorpio Group, OneCare Solutions and ReFlow. Nowadays, IMPA SAVE is an award-winning programme in the agenda of close to 15% of the global fleet and tens of maritime suppliers—over 100 companies in total—and its mantra is simple and essential to guarding the people, our planet, profit and our higher purposes: save the environment to save costs.

What does IMPA SAVE do?

There is no point emphasising yet again the shipping industry’s impact on the environment, which is significant and all too well known. Supply chain management professionals behind IMPA SAVE are aware that companies must minimise their climate footprint as much as possible, and, while long-lasting change can and should be actioned by legislators, companies sharing IMPA SAVE’s ethos believe that it is also their responsibility to adopt sustainable policies and implement responsible solutions at organisational level.

Through IMPA SAVE, we aim to develop several streams of work areas for shipping companies and maritime suppliers that aim to improve the way things are done and lessen the negative environmental impact in the process. These focus areas are, and will be, always loosely connected to ensuring a healthy and productive ocean by 2030, decarbonising shipping, ensuring fully traceable seafood, and ending waste from entering our oceans.

It is important to note than IMPA SAVE does not innovate, so to speak, but rather brings existing solutions to light that better our environmental footprint while reducing costs. In a nutshell, we share knowledge and sustainable solutions, we partner and collaborate with others, like the UK Chamber of Shipping and BIMCO, and we incentivise others to take action.

How can companies join IMPA SAVE?

IMPA SAVE started with and is still continuing a massive campaign against the use of single-use plastic drinking water bottles onboard the world’s 55,000+ vessels. It is a massive movement that is opened to both purchasers and suppliers who want to have a say and act. The former can act by beginning to produce drinking water onboard—using well-tested and industry-endorsed water filtration systems, many of which are freely available in the IMPA SAVE Directory—and regularly communicating progress to us and the industry. Accountability is paramount and well encouraged, as we are firm believes that if you cannot measure something, you cannot improve it. Suppliers, on the other hand, can act by supplying filtration systems or more sustainable alternatives for emergency stock replenishing, and by talking about this with their customers and trying to steer them away from plastic bottles.

IMPA SAVE now has over 15% of the global fleet engaged in the movement and tens of suppliers, all working in tandem to ditch plastic bottles. We are growing every day and welcome new pledgers all the time, so please join us if this is something of interest to your company.

What are the benefits of joining IMPA SAVE?

It is fairly simple, really. When it comes to removing plastic bottles from onboard vessels, it is not just a matter of kicking plastic and vastly improving ESG performance, but it can also act as a strategy for carbon reduction. It is no secret that the big emitter is fuel, but IMPA SAVE also plays a small part of the emission picture. Company ReFlow did a Life Cycle Assessment recently on packaged water versus producing water onboard using a filtration system. It was found that the total emission of the water filtration unit equals the use of 354 half-litre PET bottles. Now, thinking that a ship consumes 12,000+ litres onboard… Not such a small impact anymore, right?!

We are also searching all the time for new work streams, with exchanging detergents and chemicals with alternative onboard-made solutions and recycling of ropes deemed as waste being the next in the pipeline. Being part of IMPA SAVE opens up a pathway for companies with green initiatives paired with readily accessible solutions. With no cost in joining, the question should not be “why join?”, rather “why not join?”.

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IMPA SAVE is an IMPA initiative
Learn more: www.impasave.org
Email: [email protected]

We have taken a look at the Global Maritime Trends 2050 report from Lloyd’s Register and Lloyd’s Register Foundation which identified that issues facing the sector in the future include key ports becoming unusable due to climate change, a surge in the percentage of women in the workforce, and African nations becoming the world’s main suppliers of seafarers.

As a result of the report, Lloyd’s Register state that the maritime industry must improve its forecasting to prepare for a range of possible futures.

Lloyd’s Register and Lloyd’s Register Foundation have called on shipowners and other supply chain stakeholders to increase their ability to deal with significant changes and possible future scenarios – developed in a new report presented at London International Shipping Week.

The report, “Global Maritime Trends 2050”, authored by Economist Impact, is part of a new joint multi-year Global Maritime Trends programme between Lloyd’s Register and Lloyd’s Register Foundation.

Significant changes the report identified include:

Some of the world’s largest ports becoming unusable due to sea level rises.

• The IPCC estimates that sea levels are expected to rise by 0.29m to 0.51m by 2100 in a business-as- usual scenario.
• The report shows that a 40cm rise by 2050 could possibly render the ports of Houston (US) Shanghai (China) and Lázaro Cárdenas (Mexico) unusable.

African nations becoming dominant sources of labour supply to the industry.

• The IMF has forecasted that Africa will have the world’s youngest median age by 2050, at just 25.
• As other regions face increasingly ageing populations, Africa will buck the trend. For industries like shipping, this means that new recruits may increasingly come from African countries, potentially supplanting traditional strongholds in Asia.

Women making up 25% of seafaring workforce by 2050 due to technological advancements

• In 2021, women accounted for less than 2% of the global seafaring workforce, according to the latest BIMCO/ICS Seafarer Workforce Report.
• But a technology-driven energy transition could see this rapidly increase by mid-century.
• By 2050, the need for more tech-savvy ship managers could enable more women to take on managing positions on land and at sea, as increasingly autonomous ships and systems call for oversight and monitoring rather than intensive manual labour.

The report analysed likely future scenarios for shipping in 2050, based on the speed of technology adoption and the level of global collaboration, to help the industry forecast risks, opportunities, and required investment.

It was presented at an event at The Gherkin during London International Shipping Week.

Nick Brown, CEO of Lloyd’s Register, said that the report and the wider programme which will help benchmark some of the findings, represented an excellent opportunity to prepare for change and take action. He commented: “Other industries are much better at forecasting. The financial sector, for example, has a deep understanding of potential future scenarios and how to prepare for them, but shipping lags behind.

“From tackling the energy transition to sourcing the next generation of seafarers, we’ve allowed uncertainty to delay action for too long. Now we’ve created a way for the industry to get a much better idea of the future. It’s time for them to get on board.”

Ruth Boumphrey, CEO, Lloyd’s Register Foundation, added: “Shipping is deeply intertwined with geopolitical and macroeconomic challenges. Ships deliver 80% of the world’s trade and disruptions are felt acutely across the globe.”

“Amid global supply chain uncertainties, the urgent need to decarbonise, the integration of new technologies, concerns about human rights and safety at sea, and the future of labour supplies, it’s crucial that those in the shipping industry do everything in their power to anticipate, mitigate, and overcome these challenges without causing harm elsewhere.”

The Global Maritime Trends 2050 research programme will include a series of ‘deep dive’ reports in which Lloyd’s Register and Lloyd’s Register Foundation will commission expert organisations to examine what is needed to create a safe and sustainable maritime sector, in the face of geopolitical, macroeconomic, technological, and other societal shifts.

You can download the full report here.