A new study by UMAS and the Energy Transitions Commission says that massive investment is required if the shipping industry is to meet IMO’s 2050 target to reduce emissions by at least 50% (from 2008 levels)
Undertaken for the Getting to Zero Coalition – a partnership between the Global Maritime Forum, the Friends of Ocean Action, and the World Economic Forum – the study states that, depending on the production method, the cumulative investment needed between 2030 and 2050 to halve shipping’s emissions would amount to between US$1-1.4Tn, an average of US$50-70Bn annually for 20 years.
And further investments of some US$400Bn over 20 years would be required if shipping is to fully decarbonize by 2050, bringing the estimated total to US$1.4-1.9Tn.
Shipping’s decarbonisation transition will require infrastructure investments in new fuel production, supply chains, and a new or retrofitted fleet, according to the study.
Global Maritime Forum’s Managing Director Johannah Christensen said the green transition “is considerable, but certainly within reach if the right policy measures are put in place”.
Some policy measures are already being debated within the industry and in public bodies. The EU’s green new deal extends to shipping and an emissions trading system. Meanwhile, private players have called for a self-financed R&D fund.
Overall, the majority of the capital expenditure required to halve maritime emissions by 2050 would be in land-based infrastructure and production facilities for low-carbon fuels.
Production facilities for low carbon fuels would require around 87% of the total investment amount. This would include investments in both the production of low carbon fuels as well as the land-based storage and bunkering infrastructure needed to supply them.
Chair of the Energy Transitions Commission, Adair Turner said the process of decarbonisation on land is a “systemic transformation that goes beyond the capabilities of the maritime industry alone.”
The study’s estimates were based on ammonia being the primary zero-carbon fuel choice.
This month, MISC Berhad, Samsung Heavy Industries (SHI), Lloyd’s Register and MAN Energy said they will begin work on a joint development project for an ammonia-fuelled tanker to support the decarbonisation drive.
Attend Riviera’s Maritime Air Pollution Conference in Miami, USA, on 5 & 6 March 2020 and hear first-hand vessel owner/operator experiences with their chosen compliance technologies including fuels, lubricants, engines and scrubbers.