Responsible for 3% of global greenhouse gas emissions, the “hard to abate” global shipping industry is on track to receive more scrutiny than ever before at this year’s COP 27 climate summit.
“It’s expected the entire sector will be encouraged, pushed, and even cajoled into setting a more ambitious timeline to decarbonize, and lay out targets to hit along the way,” CBC News reported in the lead-up to the two-week conference.
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The transition to cleaner fuels may be difficult, but there is a willingness to do it, Brian Østergaard Sørensen, head of research and development at MAN Energy Solutions, a major designer of commercial ship engines. “For us, the payoff is that our technology will be future-proof.”
But Danish shipping giant Maersk’s head of decarbonization, Morten Bo Christiansen, recently said the oil industry is blocking the transition to cleaner energy in global supply chains. “Today, we buy our fuel from the oil companies. But they have not offered us any green methanol at a price point we can accept,” Christiansen said.
Shipping has long been recognized as a prominent contributor to climate change—with industry emissions equal to those of Germany in a year, says CBC. These emissions must be eliminated by 2080 to align with the Paris Agreement. But the industry’s regulator, the International Maritime Organization (IMO), has only committed to halving emissions by 2050. Suppliers, customers, and many within the industry are urging a more ambitious target. With the IMO due to announce its emissions strategy next spring, COP 27 has become a crucial opportunity for industry and governments to negotiate terms.
“This COP 27 needs to give confidence to policy-makers that this transformation is possible and ensure that the outcomes of COP are transferred to the IMO policy negotiations,” write the UN Climate Change High-Level Champions.
In a bid to make that happen, the United States and Norway collaborated to launch a Green Shipping Challenge at the COP 27 World Leaders’ Summit November 7. Countries, ports, and companies made 40 major announcements on issues like shipping innovation, next-generation vessels, and low- or zero-emission fuels.
More than 200 pilot projects across the world are looking into carbon neutrality in shipping, but there’s still a need for major capital investment in fuel production and storage facilities. Overall, the industry-wide transformation will cost an estimated US$1 to $1.4 trillion, CBC says.
Governments are also looking into policies to spur the transition, with several countries—like the Marshall Islands, the Solomon Islands, and Japan—considering carbon taxes. They say the revenue could fund green infrastructure investments, but other countries like Panama that have an “outsized dependence on shipping” are wary of any measures that could hamper the industry.
Similarly, collaborations for “green corridors”—like the Clydebank Declaration signed by 22 nations at last year’s COP, “to spur ports and shipping companies to build or retrofit facilities along specific routes where new, greener fuels will be produced and stored”—lack the support of key shipping nations like South Korea, China, and South Africa, CBC says.
Two upcoming side events at COP 27 hosted by the Brussels-based European Federation for Transport and Environment will discuss strategies for cutting shipping emissions. One will focus on regional policy approaches to decarbonize the industry and support sustainable development in port communities, while the other will explore natural gas as a potential solution.