Smart Green Shipping dedicate efforts to clean up CO2 emissions

Materials World magazine
4 Jul 2016

Although it accounts for more than one million tonnes of daily CO2 emissions, the shipping industry has remained exempt from carbon targets. Khai Trung Le talks to Diane Gilpin about the Smart Green Shipping Alliance’s efforts to make the sector cleaner.

At the 2015 UN Climate Change Conference, 195 countries committed to a landmark agreement to fight climate change and carbon emissions. However, following disagreement during the Paris talks, international shipping was left entirely absent from greenhouse gas targets. The sector is currently responsible for 2.2% of world CO2 emissions, but the UN International Maritime Organisation believes the impact from shipping vessels could rise by between 50–250% by 2050 without action, as economies grow and trade increases. Research from and University College London, UK, indicates that shipping produces more than one million tonnes of CO2 daily.

‘Shipping doesn’t really get a look in when we talk about transport systems,’ said Diane Gilpin, CEO of Smart Green Shipping Alliance (SGSA), during the IOM3 Eco-Design and Product Sustainability in the Transport Sector conference. ‘That’s largely because shipping isn’t owned by anybody. It’s an international industry, literally a law unto itself, and the sector has no plans to decarbonise.’

Without emissions targets within the shipping sector, Gilpin stated that any attempts to limit global warming to ‘well beneath 2˚C’ would require step-change technology. ‘And the shipping industry is not adopting any solutions. It is relying entirely on energy efficiency, which is not enough to meet the targets laid down in Paris. There has to be significant technology improvement,’ she added.

When a ship is not a ship

Despite this, Gilpin told Materials World that regional targets would not prove effective. ‘Shipping manages its own affairs, empowered by the UN to regulate international emissions, and it’s quite right that it should be so. If you have a regional carbon directive for shipping, it would force all trade to be registered somewhere else. It would unbalance the system. So it has to be an international policy, but that is very complex to create. Because of that difficulty, it hasn’t happened and has impacted the development of technology and new business models in the sector.’

Another issue is in identifying and locating ships in need of change or retrofitting. Gilpin said, ‘Google “how many ships are there in the world?” and you get very different answers, ranging between 50,000–100,000, depending on your source. It sounds bizarre, but there isn’t much clarity about what a ship is – does a fishing boat count? A ferry? What about its size? Additionally, many ship owners are invisible. They operate vessels from offshore destinations in less-than-transparent business structures.’

Much of the recalcitrance is centred on the sector being under distress, with a hesitance to adopt new technology. ‘If you’re going to build a ship that has to last 30 years, you want to know that anything you put on is going to be worthwhile,’ Gilpin said. ‘But it’s a Catch-22 situation. There are no demonstrators, which means you can’t develop confidence.’

The confusion of the shipping sector also adds split incentive, argues Gilpin. ‘Quite often, the ship is owned by one legal entity and chartered by others. If I own the ship, and the charter/operator pays the fuel bill, I have no desire or motivation to invest in it to become more fuel-efficient. Very similar to property – if I own a house and you rent from me, you might want to reduce your electricity bills. But I don’t want to spend any money making your house more efficient.’

Without policy drivers, SGSA aims to persuade the shipping sector through different approaches. ‘Lack of policy is absolutely the biggest challenge, and it’s evidenced by the lack of change within the industry. The way we do it is through economic rationale. How can we improve our product for the shipping industry against what they are currently using? That has to be done in a technically and commercially viable way. It can’t be telling them to do something because it’s green, but because it’s better. That’s the message,’ commented Gilpin.

Beyond this, SGSA will target the end users, ‘who own cargo and need to show clean, transparent supply chains,’ who Gilpin sees as the ‘first movers in this space. You might look at big brands banging the drum for carbon sustainability in their corporate messaging.’

Offshore in the 80s

Wind is not an energy source new to shipping, nor is the desire to use it in recent times. New Scientist and Popular Science both published articles in December 1980 celebrating the potential of offshore wind in the shipping industry, citing plans from Nippon Kokan, Japan, Windship Development Company, USA, and Coe Metcalfe, UK, to create sail-powered freight ships. Gilpin’s efforts followed shortly afterwards.

‘In 1992, we launched a company called the Bright Green Shipping Company and it didn’t succeed. In 1998, B9, a predecessor to SGSA, was asked to deliver a feasibility study on using wind at sea. Everyone thought it was fantastic, and then it didn’t go any further. What drove us to start this round of development was the implementation of the Renewable Energy Directive in 2009, and the likelihood of an emissions trading scheme implemented by the EU. We thought that would stimulate the shipping sector to take a more benevolent approach to radical step-change technology. We were wrong.’

However, SGSA is buoyed by the continual growth in the renewable energy sector, which Gilpin refers to as one of the few sectors attracting investors. SGSA aims to provide the shipping sector with an alliance organisation that includes Rolls-Royce, the Met Office and Cammell Laird to provide companies and ship owners with the technical, analytical and financial support to deploy wind power on modern ships, with the prime goal of designing and manufacturing its own wind-powered freight ships using FastRigs – automatic, modular freestanding rigs as tested on the superyacht The Maltese Falcon.

The UN Convention of the Law of the Sea also shares Gilpin’s optimism, referring to offshore wind as the only renewable technology that has ‘reached an acceptable stage of development to be considered competitive’, although warns that the potential impact of renewable energy development on various forms of marine life remains an unknown quality.

Cement in its pockets

Gilpin stressed that these measures are intended to help the sector contribute its fair share. ‘If shipping hasn’t adopted meaningful emissions targets by 2020, it means every other nation and sector that signed to carbon reduction programmes will have to work harder to make up for shipping’s lack of action. That will become an overwhelming driver for shipping, because I don’t think everyone else is going to stand back and listen to shipping say, “we’re really special so we can’t change”. The cement industry said that too. But it had to change.’

Although it has the ultimate intention of building its own ships, SGSA sees retrofitting as the most pragmatic solution to helping the shipping market understand the technology and gain confidence in offshore wind, as well as helping to integrate the technology within the sector in a shorter timeframe.

‘Our next steps are to evaluate the market potential to go through existing processes and to create the course to introduce the circular economy into shipping,’ Gilpin said. ‘We think that maritime renewables have a very good chance of emulating onshore renewables, but faster. The technology has moved on and distressed industries – like shipping, which has an oversupply of ships, an undersupply of cargo, and is in fire-fighting mode – are open for disruption. It is the flagship of the future, and you’re welcome to join us on-board.’