Carbon Emission Control In Shipping

CAPT. SANJEEV VERMA

In the modern age, where an increased effort for natural sustainability is ever important, decarbonization is increasingly becoming a priority for many industries and companies. This is no exception for the shipping sector.

Carbon emissions from the shipping industry account for around 2.2% of global greenhouse gas emissions, making it a significant contributor to climate change. However, with the world becoming increasingly aware of the need to reduce carbon emissions, there is a growing push to control carbon emissions in the shipping industry. The International Maritime Organization (IMO) pledging to decrease the CO2 emissions rate by 50% by 2050, the industry is aiming for a decarbonated future. There are many ways to achieve this aim.

1)           Improved ship design and technology

Improved ship design can significantly help in cutting carbon emissions in shipping by reducing the amount of fuel required to operate the vessel. Here are some ways that improved ship design can achieve this:

1. Energy-efficient hull design: By improving the hull design, ships can reduce drag and resistance while sailing, which means they can travel faster using less fuel. This can be achieved using advanced coatings, streamlined shapes, and optimized hull profiles.
2. Hybrid propulsion systems: Hybrid propulsion systems that combine conventional engines with batteries, fuel cells, or other clean energy sources can reduce the amount of fuel needed to operate the vessel, resulting in lower carbon emissions.

iii.          Fuel-efficient engines: Modern ship engines are more fuel-efficient than older models, resulting in lower emissions. The use of high-efficiency engines, such as those that run on Duel Fuel technology, can significantly reduce carbon emissions.

1. Energy-saving technologies: The implementation of energy-saving technologies, such as waste heat recovery systems, air lubrication systems, and advanced control systems, can also help reduce the energy consumption of the vessel and lower carbon emissions.

2)           Use of low-carbon fuels

There are several types of low carbon fuel that can be used in shipping, including biofuels, hydrogen, methanol, and ammonia. Biofuels are derived from renewable resources such as agricultural crops and waste products. Hydrogen and ammonia can be produced using renewable energy sources such as solar and wind power.

One advantage of using low carbon fuel in shipping is that it can significantly reduce greenhouse gas emissions. For example, biofuels can reduce emissions by up to 80% compared to traditional fossil fuels. Hydrogen and ammonia have the potential to eliminate emissions entirely if produced using renewable energy sources.

However, there are also challenges associated with the use of low carbon fuel in shipping. One significant challenge is the availability and cost of these fuels. Currently, low carbon fuels are more expensive than traditional fossil fuels. Another challenge is the infrastructure needed to store and transport these fuels. For example, hydrogen and ammonia require specialized storage and handling facilities.

Despite these challenges, many shipping companies are investing in the development and use of low carbon fuel. In addition to reducing emissions, the use of low carbon fuel can also help shipping companies meet regulations and reduce their environmental impact.

3)           Improved operational efficiency

Improving operational efficiency can have a significant impact on reducing the carbon footprint of shipping. There are several ways in which this can be achieved:

1. Reducing fuel consumption: One of the most effective ways to reduce carbon emissions in shipping is to reduce fuel consumption. This can be done through various measures such as optimizing ship speed, maintaining engines and equipment, just-in-time arrival, and reducing idling time.
2. Improving cargo handling: Another way to improve operational efficiency is to optimize cargo handling. This can include reducing loading and unloading times, optimizing stowage plans, and minimizing unnecessary ballast water exchange.

iii.          Implementing energy-efficient technologies: Shipping companies can also improve operational efficiency by investing in energy-efficient technologies such as more efficient engines, LED lighting, and more efficient propulsion systems.

1. Reducing waste and emissions: Reducing waste and emissions is another way to improve operational efficiency. This can include minimizing waste generation, using cleaner fuels, and reducing greenhouse gas emissions from refrigerants and air conditioning systems.
2. Voyage optimization: Maximizing efficiency and reducing costs during a voyage of a vessel, from one port to another. This involves making decisions on factors such as route planning, speed, fuel consumption, and cargo loading and unloading, with the aim of minimizing the overall time and cost of the voyage while ensuring safe and reliable transportation of goods. Modern technology and data analytics play an important role in voyage optimization. For example, computer models can simulate different voyage scenarios based on factors such as weather conditions, sea currents, and vessel performance data. This can help shipping companies to identify the most efficient route and speed, as well as optimize cargo loading and unloading schedules, fuel consumption, and maintenance activities.

4)           Carbon pricing and emissions trading

Carbon pricing and emissions trading are mechanisms aimed at reducing greenhouse gas emissions by putting a price on carbon. Carbon pricing involves putting a price on the carbon emissions associated with emission from ships. This can be done through various methods, such as a carbon tax or a cap-and-trade system. A carbon tax is a direct tax on carbon emissions, while a cap-and-trade system sets a cap on emissions and allows companies to trade permits to emit within that cap.

In the shipping industry, a carbon tax could be applied to fuel used by ships, while a cap-and-trade system could set a limit on the total emissions from the industry and allow companies to buy and sell emissions permits.

Emissions trading is a market-based mechanism that allows companies to buy and sell emissions allowances, creating a market for carbon credits. The idea is that companies that can reduce their emissions more easily can sell their allowances to companies that have a harder time reducing their emissions.

In the shipping industry, emissions trading could be used to create a market for carbon credits that would allow companies to offset their emissions by investing in projects that reduce emissions in other sectors or countries. This would incentivize companies to reduce their emissions and create a mechanism for financing emissions reduction projects.

5)           Collaboration and partnerships

Collaboration and partnerships between industry players, governments, and NGOs can also help reduce carbon emissions in shipping. For example, the Global Maritime Forum, a non-profit organization, is working to create a more sustainable and resilient maritime industry through collaboration between industry leaders, policymakers, and other stakeholders.

The carbon footprint of shipping is a growing concern for the industry, and the push towards greater carbon efficiency is likely to have significant effects on shipping finance. One effect may be an increase in the cost of financing for ships with higher carbon footprints. As investors become more focused on sustainability and carbon emissions reduction, they may be more hesitant to invest in vessels that are not environmentally efficient. This could lead to higher interest rates or more stringent lending criteria for ships that do not meet certain carbon footprint standards.

On the other hand, vessels that are more carbon efficient may become more attractive to investors and lenders. They may be able to secure more favorable financing terms, or even attract additional investment from parties that are specifically interested in sustainable shipping. In addition, as regulations and carbon pricing mechanisms become more prevalent in the shipping industry, companies that operate less carbon-efficient vessels may face additional costs and penalties. This could impact their ability to repay loans or attract new investment, potentially leading to higher default rates and increased risk for lenders. The push towards greater carbon efficiency in the shipping industry is likely to have significant effects on shipping finance, and companies that can adopt more sustainable practices may be better positioned to attract investment and secure favorable financing terms.

In conclusion, reducing carbon emissions in shipping is crucial to combatting climate change. By using a combination of improved ship design and technology, low-carbon fuels, operational efficiency, carbon pricing and emissions trading, and collaboration and partnerships, the shipping industry can play its part in reducing global carbon emissions. It is important for all stakeholders to work together to achieve a more sustainable and environmentally friendly shipping industry.

Marex Media