Maritime shipping executives last week called on the International Maritime Organization to help accelerate the transition to green fuels in ocean freight, a step forward in their commitment to reducing the industry's carbon emissions.
The call to action, made during COP28 as a joint declaration from the CEOs of major shipping lines, asks the IMO to establish:
- An end date for the building of fossil fuel-only vessels and a timeline to accelerate the energy transition.
- An effective greenhouse gas pricing mechanism to make green fuel competitive with non-green fuel during the transition phase.
- A vessel pooling option allowing the performance of a group of vessels to count for emissions targets, rather than solely counting by individual ships.
- A regulatory basis to align investment decisions with climate interests and mitigate the risk of stranded assets.
The joint declaration emphasized each of these actions would incentivize markets to act in ways aligned with energy transition goals. By counting emissions by vessel pools, for example, shipping lines would have an incentive to make investments in "areas where they achieve the greatest GHG reduction."
The call to action comes as the EU Emissions Trading System — a European rule pushing the shipping industry toward carbon neutrality by 2050 — nears its January 1, 2024 start date.
Each ocean carrier who took part in the joint declaration has already made independent commitments to reduce greenhouse gas emissions. Here’s a look at each shipping line's goals, and what their CEO had to say.
“A.P. Moller - Maersk wants to accelerate the green transition in shipping and logistics and a crucial next step is to introduce regulatory conditions which ensure that we create the most greenhouse gas emission reductions per invested dollar. This includes an efficient pricing mechanism to close the gap between fossil and green fuels and ensuring that the green choice is easier to make for our customers and consumers globally. The momentum for green fuel is building and we are pleased to see strong partnerships across the industry as we continue our joint efforts of making decarbonisation in shipping successful,” said Vincent Clerc, CEO of A.P. Moller - Maersk.
CMA CGM’s goal to reach net-zero emissions in its operations is set for 2050. As part of its decarbonization efforts, the France-based ocean carrier launched a program in 2022 that incentivized shippers to return their containers early in exchange for carbon credits.
“We have already invested close to $15 billion in decarbonizing our fleet, which will enable us to have almost 120 vessels capable of being powered by decarbonized fuels by 2028. Pioneer in LNG as a transition energy, our Group has also launched several large industrial partnerships to diversify our sourcing with even more decarbonized fuels. In 2023, the CMA CGM Group will reduce its CO2 emissions by around -1 million tons. Alongside the members of this coalition and all those who will join us afterwards, the CMA CGM Group pursues its decarbonization journey and renews its commitment to a shared and sustainable future,” said Rodolphe Saadé, Chairman and CEO of CMA CGM.
Hapag-Lloyd has a goal to reach net-zero emissions in its operations by 2045. Similar to Maersk, the Germany-based ocean carrier is also part of the Ship Recycling Transparency Initiative, a platform aimed to accelerate the voluntary approach to responsible ship recycling, which launched in 2018.
“Our collective responsibility for a sustainable future and clean practices is paramount. At Hapag-Lloyd, we reaffirm our commitment to advance the decarbonisation of the maritime industry and strive to be at the forefront of the energy transition. We believe that a regulatory framework and clear targets are crucial to accelerating the introduction of alternative fuels and reducing our carbon footprint. This commitment is in line with Hapag-Lloyd's goal of achieving a net-zero carbon fleet by 2045 and reflects our industry's unwavering commitment to environmental responsibility,” said Rolf Habben Jansen, CEO of Hapag-Lloyd.
MSC has set up a goal to reach net-zero by 2050. As part of its efforts to reduce its greenhouse emissions, the ocean carrier made a deal with DB Schenker to offer net-zero emission ocean shipments back in March.
“Shipping is at the forefront of technological innovation when it comes to decarbonization and at MSC our fleet renewal strategy includes 100 dual fuel vessels. We are proud to be part of this unprecedented collaboration with our peers and it is only right that together we follow this path towards net zero that we must achieve by 2050. The support of Governments across the world will be an essential element to reach our common goal and among those efforts we want to see an end to delivery of ships that can only run on fossil fuels. MSC has fully supported and committed to net decarbonization by 2050 but without the full support from other stakeholders particularly energy providers it will be extremely difficult to meet those objectives - no one can do this alone,” said Soren Toft, CEO of MSC.
The Norwegian and Swedish shipping company is working to develop commercially viable zero emission vessels by 2030.
“At Wallenius Wilhelmsen we have decided to be a shaper of the journey to net-zero and focus our investments in supporting this ambition. Our customers want to partner with us on the voyage. Now, we need a global regulatory framework matching this ambition to drive the investments needed at a global scale,” said Lasse Kristoffersen, President and CEO of Wallenius Wilhelmsen.