UK Sets Ambitious Targets To Cut Shipping Emissions

in International Shipping News,Shipping: Emission Possible 12/07/2019

All new ships for UK waters ordered from 2025 should be designed with zero-emission capable technologies, in ambitious plans set out by Maritime Minister Nusrat Ghani to cut pollution from the country’s maritime sector.

The commitment is set out in the Clean Maritime Plan published today. The government is also looking at ways to incentivise the transition to zero-emission shipping and will consult on this next year.

The plan also includes a £1 million competition to find innovative ways to reduce maritime emissions and is published alongside a call for evidence to reduce emissions on UK waterways and domestic vessels.

The Clean Maritime Plan is part of the Government’s Clean Air Strategy, which aims to cut down air pollution across all sectors to protect public health and the environment. It will also help deliver the United Kingdom’s commitment to be net zero on greenhouse gases by 2050.

Maritime Minister Nusrat Ghani

Maritime Minister Nusrat Ghani said:

“Our maritime sector is vital to the success of the UK’s economy, but it must do everything it can to reduce emissions, improve air quality and tackle climate change.

“The Clean Maritime Plan sets an ambitious vision for the sector and opens up exciting opportunities for innovation. It will help make the UK a global hub for new green technologies in the maritime sector.”

The maritime sector has already taken significant strides to reduce emissions – hybrid ferries are already being used in UK waters, including in the Scottish islands and on cross-Solent journeys to the Isle of Wight. The Port of London Authority – where the Maritime Minister launched the Plan today – also uses hybrid vessels.

Sarah Kenny, Chief Executive of BMT Group and representing the Mari-UK consortium, said:

“The Clean Maritime Plan is an important step towards achieving a zero-emission future for the UK. Getting to net zero will not be easy, but it will present significant opportunities as well as the obvious challenges for all parts of our £40bn maritime sector. Maritime is already the greenest way of moving freight, but we can and must do more to reduce emissions.

“The good news is that the UK is well-placed to not only decarbonise our own economy, but also to share our expertise and capability with the rest of the world as they, too, embark on this most global of missions.

“For the first time, companies and universities from across the country have come together to collaborate through MarRI-UK, accelerating the UK’s maritime technological capabilities, particularly on decarbonisation.

“The key ingredient to realising our clean maritime ambitions is collaboration. Between companies, academia and with government. Today’s plan and government’s broader Maritime 2050 strategy, crafted with Maritime UK, provides a framework to do just that.”

Guidance has also today been issued to ports to assist them in developing air quality strategies. This will both address their own operations and support improving air quality across the country.

Tim Morris, chief executive of the UK Major Ports Group and member of the Clean Maritime Council, said:

“The Clean Maritime Plan is a really valuable piece of work, setting out an ambitious path forward for the transformation of the maritime sector in the UK. It doesn’t shy away from the scale or complexity of the challenge of such a transformation. But it’s a transformation that the ports industry, along with the rest of the maritime sector and working in partnership with Government and other stakeholders, is determined to take on.”

A further consultation to increase the uptake of low carbon fuels will also take place next year.

The Clean Maritime Plan is part of the government’s Maritime 2050, a long-term strategy published in January 2019 to keep the UK as a world leader in the maritime sector for decades to come.
Source: UK Department of Transport

Singapore retains top spot as international shipping centre

in International Shipping News 12/07/2019

Based on objective factors including port throughput and facilities, depth and breadth of professional maritime support services, as well as general business environment, the report is a collaboration between the Chinese state news agency, Xinhua, and international freight benchmark provider, the Baltic Exchange.

Acquired by the Singapore Exchange (SGX) in 2016, the Baltic brings together complementary strengths of Singapore and London, two of the world’s most important maritime centres.

In the six years since this report has been published, there has been a general rise in the performance of Asian and Middle Eastern locations. The first report in 2014 included three European locations in the top five; in 2019 only London remains. The top five international shipping centres are Singapore, Hong Kong, London, Shanghai and Dubai.

Lu Su Ling, Head of Baltic Exchange Asia, says; “Singapore commands a strategic position as a maritime hub in the regional and global arena. The maritime industry is, and will remain, a big contributor to Singapore’s economy and it is therefore important that we continue to innovate and invest in this sector to achieve long-term success.”

“We are honoured to top the 2019 Xinhua-Baltic International Shipping Centre Development Index for six years running. It is a vote of confidence to the quality of services offered by the Port of Singapore, as well as the conducive business environment that facilitates an array of maritime activities in Singapore. This would not have been possible without the strong support from the maritime establishments, industry partners and unions. We look forward to an even closer working relationship to bring the Singapore maritime industry to even greater heights,” said Dr Lam Pin Min, Senior Minister of State, Ministry of Transport and Ministry of Health.

Xu Yu Chang, President of The China Economic Information Service, a wholly-owned company of the Xinhua News Agency, says; “Shipping is an essential method of international trade transportation and has become a significant pillar in the evolution of globalisation. Over the years, the joint index by Xinhua and the Baltic Exchange has become a globally recognisable evaluation tool for shipping centres around the world. In the context of continued globalisation, I believe our index will play an even greater role in optimising the allocation of global shipping resources and promoting the scientific development of international shipping centres in the future.”

Based on the evaluation scores, Singapore shows strength in ship management and shipbroking services, while Hong Kong is benefiting from China’s Belt and Road Initiative and economicopportunities in the Guangdong-Hong Kong-Macau Greater Bay Area. London’s first-class services in shipbroking, legal and shipping finance were highlighted. As important cities in emerging economies, Shanghai and Dubai are catching up with London in their level of shipping development, and were ranked fourth and fifth respectively.

Table: Top 10 port cities of Xinhua-Baltic International Shipping Centre Development Index

Ranking201920182017201620152014
1SingaporeSingaporeSingaporeSingaporeSingaporeSingapore
2Hong KongHong KongLondonLondonLondonLondon
3LondonLondonHong KongHong KongHong KongHong Kong
4ShanghaiShanghaiHamburgHamburgRotterdamRotterdam
5DubaiDubaiShanghaiRotterdamHamburgHamburg
6RotterdamRotterdamDubaiShanghaiShanghaiDubai
7HamburgHamburgNew York – New JerseyNew York – New JerseyDubaiShanghai
8New York – New JerseyNew York – New JerseyRotterdamDubaiNew York – New JerseyTokyo
9HoustonTokyoTokyoTokyoBusanNew York – New Jersey
10AthensBusanAthensAthensAthensBusan

2019 Xinhua-Baltic International Shipping Centre Development Index report [PDF]

Source: The Baltic Exchange

Vehicle import rules getting even tougher ahead of stink bug season

Biosecurity rules are being tightened to prevent the arrival of a pest which could devastate New Zealand’s horticultural industry.

The brown marmorated stink bug feeds on more than 300 plants and has already cut a swathe through Europe and the United States.

If it gained a foothold in New Zealand, it could cost the horticulture and arable industries an estimated $4 billion.

In an effort to keep the bug at bay, Biosecurity New Zealand is tightening the rules for imports during this year’s stink bug season, which runs from September to April.

Under the new rules, the list of countries required to fumigate imported vehicles, machinery, and parts before their arrival in New Zealand would rise from 17 to 33.

These countries have all been identified as having stink bug populations.

In another change, imported vehicle cargo would need to be treated offshore, including cargo in shipping containers.

In the past only non-containerised vehicle cargo has required offshore treatment, Biosecurity New Zealand spokesman Paul Hallett said.

Offshore treatment requirements would also apply to all containers from Italy.

The brown marmorated stink bug feeds on more than 300 plants could cost the horticulture and arable industries an estimated $4 billion if it became established in New Zealand.
SUPPLIEDThe brown marmorated stink bug feeds on more than 300 plants could cost the horticulture and arable industries an estimated $4 billion if it became established in New Zealand.

“The new rules are intended to reduce the biosecurity risk to New Zealand, by ensuring potentially contaminated cargo arrives as clean as possible,” Hallett said.

Biosecurity NZ planned to have officers based in Europe this season to educate manufacturers, treatment providers and exporters about the new requirements and to audit facilities.

“If our checks find any issues, New Zealand will not accept any cargo from that facility until the problem has been fixed.”

Hallett said New Zealand’s treatment requirements were now closer to Australia’s, which would make compliance easier for importers bringing cargo to both countries.

“A key difference is that the Australian Department of Agriculture and Water Resources will continue to allow treatment on-arrival for containerised goods,” he said.

The new rules would be provisional until July 15 and could be contested during that time.

The changes come after a spate of stink bug discoveries last year.

In November, Biosecurity NZ ordered a vehicle carrier to leave New Zealand waters after the discovery of stink bugs.

Three live and 39 dead brown marmorated stink bugs were found aboard the Carmen when it arrived in Auckland from Europe. Another 69 regulated stink bugs were also found.

A week later, more than two dozen live stink bugs were found in a box of shoes imported into New Zealand from EBay.

Stuff

Transport network plans laid out to support Auckland’s future development

The Supporting Growth programme has achieved a significant planning milestone with the publication of new indicative transport network maps for Auckland’s future growth areas.

The Indicative Strategic Transport Networkplans identify what transport projects are needed over the next 10-30 years to support the development of new communities, employment and industrial areas in Warkworth, north, northwest and south Auckland.

The plans are developed by Te Tupu Ngātahi (the Supporting Growth Alliance), a collaboration between Auckland Transport and the NZ Transport Agency, with consultants Beca, AECOM, Bell Gully and Buddle Findlay, to plan ahead and provide certainty to the community and stakeholders about what transport networks will be developed over the next few decades, in line with Auckland Council’s land use planning.

The NZ Transport Agency’s Director of Regional Relationships Steve Mutton says the plans aim to provide safe, accessible and sustainable travel choices that connect these new areas to the rest of the region and promote a greater use of public transport.

“The plans set out a shared vision by central and local government for long-term investment in Auckland’s future growth areas. It shows their commitment to working together over the next few decades to plan, fund and deliver a well-integrated transport network.”

“Publication of these plans will provide certainty for communities, developers, Auckland Council and other Crown agencies as they plan ahead for the development of new housing and employment areas.”
Auckland Transport Chief Executive Shane Ellison says the Supporting Growth Alliance is a culmination of investigations and engagement with partners, stakeholders and communities over a number of years.

“Aucklanders have told us they’re looking for more public transport, walking and cycling connections and they’re integral in our long term planning.”

The programme is a key initiative under the Auckland Transport Alignment Project (ATAP), which sets the strategic direction for Auckland’s transport network over the next 10 years and beyond. The Supporting Growth team’s next step is to undertake more detailed investigations and begin staged route protection processes across all areas over the next few years.

The Auckland Plan 2050 expects more than 130,000 new homes and 76,000 new jobs will be created in 15,000 hectares of land to be developed in the future urban growth areas of:

  • Warkworth
  • Silverdale, Wainui and Dairy Flat in north Auckland
  • Whenuapai, Redhills, Riverhead, Kumeu-Huapai in the north west
  • Pukekohe, Paerata, Drury and Takanini in the south. 

The Supporting Growth Alliance has partnered with Auckland Council, Mana whenua and KiwiRail to develop the indicative network plans. Key stakeholders and local communities have also been engaged throughout the development of the plans, and more opportunities for engagement are planned later this year and over the next few years, as projects within each area are progressed.

Most of the projects identified in the indicative networks are expected to be constructed over the longer term, in line with the anticipated rezoning and development of land by Auckland Council. The projects are yet to be prioritised for funding for delivery.

In the meantime, key projects that support growth in the short term are already funded and underway. These include:

  • Te Honohono ki Tai – Matakana Link Road in Warkworth 
  • The SH16 Safe Networks Programme project – Brigham Creek to Waimauku
  • Arterial connections in the North West (Redhills and Whenuapai)
  • Improvements to SH1 between Papakura and Drury, as part of the longer-term Papakura to Bombay Improvements project. 

Early estimates for the cost of transport improvements over the next 30 years to support the growth areas are in excess of $10bn, with funding to be secured from both public and private sources.

Further details about the Supporting Growth programme including detailed maps, project information and timelines is available at www.supportinggrowth.govt.nz

NZTA leaked report paints a picture of demoralisation and chaos for staff

A leaked report from the New Zealand Transport Agency paints a picture of demoralisation and chaos – and the situation appears to be getting worse with one in five employees wanting leadership to “work differently”.

Each year the NZTA conducts an “ask our team” survey which takes the mood of the organisation’s staff. The organisation has begun conducting smaller “pulse” surveys, the most recent of which has been leaked to Stuff. 

More than half of NZTA’s staff expressed dissatisfaction with the organisation’s leadership, with just 48 per cent saying the leadership’s actions are “consistent with our organisation’s DNA”. Other questions regarding leadership also drew negative responses. 

The survey comes on the back of a tumultuous year for NZTA, in which chief executive Fergus Gammie resigned after the organisation was found to be negligent in its role as transport regulator, leading to the death of a motorist. 

The chaos continued after Gammie’s departure, with controversial board chair Michael Stiassny resigning after serving just one year of a three year term. 

Responses to the 14 “assertions” measured in the survey were categorised into red, orange, yellow, and green. Responses in red indicate areas “that need focus”, while orange shows “potential concerns”. Yellow means “good” and green means “excellent”. 

None of the 14 responses were “good” or “excellent”, five categories showed “potential concerns”, with the remaining nine showing a need for focus, the most negative response.

NZ Transport agency interim chief executive Mark Ratcliffe.
SUPPLIEDNZ Transport agency interim chief executive Mark Ratcliffe.

All but three of the categories showed a worsening response since the last survey, which was completed using 900 responses from NZTA staff. The organisation cautioned comparing this survey with previous surveys as the sample size was smaller. 

Leadership was a particular concern. Just 45 per cent of employees believed “leaders make and deliver hard decisions in an effective way”. 

About 1300 staff also texted responses to the survey. These responses were also critical of leadership.

“We need true empowerment. We need to stop the micro-management. We need to see ownership of bad decisions made,” read one response. 

Culture has been a concern at NZTA for some time. Stuff has also obtained a leaked report from 2017. That report also raised questions about senior leadership at NZTA, noting “low” ratings of senior leaders on matters of “internal communications,” “culture,” and “leadership”.

That survey noted that members of the leadership team rated themselves “significantly higher” than the rest of the organisation. It noted concerns with emerging silos, and a “blame culture”. It said the agency needed to do more to make staff feel “safe to speak the truth”.

Interim NZTA chief executive Mark Ratcliffe told Stuff the last year had been difficult. 

“It is no secret that the past year has been a very challenging one for this organisation, and that is no doubt reflected to an extent in this feedback,” Ratcliffe said. 

But he said that recent changes, including the appointment of new chair Sir Brian Roche, would help “stabilise the organisation”.

“Our people take a lot of pride in what they do, and I’m confident that we can rebuild a strong and positive culture in the Transport Agency,” Ratcliffe said. 

Former NZ Transport Agency (NZTA) chief executive Fergus Gammie, Transport Minister Phil Twyford and former NZTA board chairman Michael Stiassny come clean about the organisation's negligence as regulator.
COLLETTE DEVLIN/STUFFFormer NZ Transport Agency (NZTA) chief executive Fergus Gammie, Transport Minister Phil Twyford and former NZTA board chairman Michael Stiassny come clean about the organisation’s negligence as regulator.

National’s Associate Transport Spokesperson Brett Hudson said the survey showed a need for action from NZTA’s leadership.

“If this was a private sector organisation, the board would be calling for a performance improvement plan,” Hudson said. 

He said the organisation needed to ask itself how it could get back on track and get staff believing in it again. 

Hudson said he was particularly alarmed by the fact that so few of the agency’s employees believed that what they were doing aligned with NZTA’s overall objectives.

“People think there’s a misalignment between what they’re supposed to be doing and what they’re actually doing,” Hudson said. 

Hudson called on Transport Minister Phil Twyford to demand better performance from the Agency. 

National's Associate Transport Spokesperson Brett Hudson called on the Government to improve the culture at NZTA.
MAARTEN HOLL/STUFFNational’s Associate Transport Spokesperson Brett Hudson called on the Government to improve the culture at NZTA.

Motor Trade Association advocacy and strategy manager Grieg Epps said results from the survey aligned with MTA members’ experiences with NZTA.

He said he was particularly concerned with lower levels of the agency not feeling empowered to make decisions.

“It is difficult to get a decision made, if the agency wants to get more responsive it needs to provide its staff with more empowerment,” Epps said.

He was hopeful that the refresh of leadership at the agency would take it in the right direction. 

“They know things need to change and there’s a willingness to change,” he said. 

Transport Minister Phil Twyford declined to comment, a spokesperson said the matter was operational for the NZTA.

New Zealand public transport system ‘not good enough’ – infrastructure chief executive officer

New Zealand’s public transport is constantly improving but still has a long way to go says Infrastructure NZ’s chief executive officer.

“I don’t think it’s good enough from a user perspective,” said Stephen Selwood on Wednesday.

“We’re constantly having to improve the system but any system like public transport where you’re using one [train] line any disruption is going to cause problems,” he told The AM Show.

Last week the derailment of a train in Wellington caused chaos for 20,000 commuters, and in June an electrical fault left all Auckland train services stopped dead in their tracks.

On top of these problems, Wellington buses are still struggling to recover from the 2018 contract switch which threw a number of services into disarray.

He says New Zealand’s issues aren’t special and problems with public transport are global.

The solution is more money – even though $4.5 billion has been given to improve Auckland’s central rail link.

But fixing “decades of underinvestment,” isn’t easy says Selwood.

“We do have to be patient, we are constantly improving but much more investment is required,” he said.

Selwood says the option of private funding should be investigated for roads and public transport.

“The whole transport system needs investment and we should be open to all possibilities [of funding].” 

Newshub.

Government won’t budge on Business Council’s demand for roads: Twyford

Transport Minister Phil Twyford says the Business Advisory Council's call to privately fund a dozen on-hold roads is
Transport Minister Phil Twyford says the Business Advisory Council’s call to privately fund a dozen on-hold roads is “bad policy”. Photo / Mark Mitchell

The Government and the Prime Minister’s Business Advisory Council see eye-to-eye on a lot when it comes to fixing the country’s infrastructure woes, Transport Minister Phil Twyford says.

They are at an impasse when it comes to roads.

In a damning letter released to The Herald, the council said New Zealand was at an “infrastructure crisis point” and lacked a national master plan to fix the issue.

Chaired by outgoing Air New Zealand chief Christopher Luxon, the group excused the current Government, saying the issue was intergenerational and added there was “no overarching vision or leadership in New Zealand for infrastructure development”.

“This means there is no nation-building narrative upon which to build a strategic direction,” it said.

It also called for a financing mechanism that would allow for long-term, debt-funded or investable opportunities and said incentives between central and local government are misaligned.

Twyford said there was a lot the administration agreed with.

“The Government shares the view of the Business Advisory Council that it’s past time for us to really lift our game in the way we plan and fund and finance infrastructure,” he said.

He points to the Infrastructure New Zealand’s wish list and says almost every item is already being addressed, through projects such as the planning reform, the establishment of an infrastructure commission, ongoing work on a variety of new financing streams, including infrastructure bonds for urban growth.

But the agreement ends at roading.

The council has called on the Government to proceed with the 12 roading projects presently on hold or under review and to open them to private investment.

“These projects are investment ready, provide the beginnings of a pipeline of investable opportunities and would be an effective use of the roading capability developed in New Zealand over the last 20 years,” the letter said.

Twyford said the Government was looking for a more balanced approach to modes of transport.

“It would be really bad policy to do what they’re advocating in that particular area,” he said

“If we were to do what the Business Advisory Council was saying, it would mean spending a great deal of money, more than $12 billion, on projects that have very low economic value.”

Allowing private investment into the roads didn’t make sense either, he said.

“Borrowing money is not the problem here. It’s never been cheaper to borrow money than at the moment … It’s actually having the revenue to be able to service that debt.”

That money could only come from the National Land Transport Fund, or tolling, he said.

“None of those roads have enough traffic on them to generate anything like the kind of revenue you would need to pay for them, to service the debt. It’s just not realistic.”

The June 26 letter, signed by the Business Advisory Council chairman on behalf of the 13-strong council, raised a number of recommendations.

They include the establishing a Ministry of Cities, Urban Development and Population, a Prime Ministerial Taskforce or Commission of Inquiry should be established to undertake a comprehensive review of NZ’s planning laws and local government system, including the Resource Management Act, Local Government Act and Land Transport Act.

Risk Aversion Grips the Shipping Industry

Ship owners around the world have adopted a risk-aversion policy, which translates to refraining from adding more newbuildings on the global orderbook. In its latest weekly report, shipbroker Banchero Costa said that “there was not much fresh business to report this week for conventional type of ships. In the Japanese dry bulk market Tsuneishi shipyard ordered for their own account a relevant number of ships being Kamsarmax, Ultramax and Handysize. The only foreign order we recorded is for a Kamsarmax for UK based Helikon Shipping (no price nor delivery dates available). Also the tanker sector showed poor levels of activity, the only business done refers to few options declared by Oman Shipping at Daewoo for four VLCC dely from June 2021. In the smaller segment, Japanese owners Nissen Kaiun extended their commitment with Chinese shipbuilders by booking 3 x 19,900 dwt product tankers at Nantong Xiangyu for delivery in 2022, no price available. Niche segment of PCTC saw an order from Japanese Kawasaki Kises and NYK for dual fuel 7,000 ceu PCTC at Imabari and Shin Kurushima respectively (specialist builders in this sector). Estimated cost per ship is around $95 mln; both are fixed on long terms to local Japanese major charterers Toyota”, said the shipbroker.

Similarly, Allied Shipbroking reported that “the lack of activity for dry bulk vessels continued for yet another week, with no new deals coming to light, while appetite amongst buyers seems to have eased back significantly lately. This comes despite the positive momentum that is currently noted in the dry bulk freight market. It is likely that owners have shifted their focus over to the secondhand market for the time being, as they are keener on bargain investments that can take imminently take advantage of the current improved market, rather than being exposed to the higher and longer term risk typically associated with newbuilding projects. It is not expected that we will see any significant changes in the current trend soon, with any possible upturn in interest being postponed till after the summer period. At the same time, newbuilding activity in the tanker market showed some signs of revival, as last week 4 new orders were reported. The majority of them included product/chemical tankers, with this segment having shown the most promise of late amongst most interested buyers right now. Investors in tanker market continue to show a more bullish face and thus we may well continue see this sort of new ordering volume tricle through over the coming months”.

Meanwhile, in the S&P market, Allied said this week that “on the dry bulk side, the current positive momentum in the freight market increased interest for second-hand units, with activity remaining at healthy levels for yet another week. Interestingly, last week we saw deals include vessels from larger size segments of the dry bulk fleet, such as Capes and Panamax, with the focus extending to more vintage units as well. This pattern is expected to continue to be seen over the coming weeks, as optimism has returned to buyers following the recent recovery in freight rates. On the tanker side, we might not have seen the impressive levels that were being noted some weeks back, but a fair amount of deals did come to light. Focus was spread across the whole spectrum of the tanker sector, reflecting the positive market outlook being held now. It is anticipated that we will see further activity take place in the following weeks, as optimism for improved earnings to be seen in the final quarter of the year are now mounting”, the shipbroker said.

In a separate note, Banchero Costa added that “in the dry market, it was reported Japanese controlled Capesize “Euro Fortune” around 177k dwt 2005 built Mitsui was done at $14.7 mln. Furthermore always in the same segment “Mineral Noble“ around 170k dwt 2004 built Hyundai was sold at $13.5 mln with 3 years t/c back to present owners. Concerning Panamax, “Crystal Windabt” around 76k dwt 2009 built Shin Kasado was done at $13.3 mln, a month ago “Nord Galaxy” around 77k dwt 2006 built Imabari (BWTS fitted) was fixed at $10.6 mln. A tier II Supramax “Tomini Victory” around 57k dwt 2012 built Yangzhou was sold at $ 10.8 mln. At an auction in UK a modern Handysize “Alkyon” around 36k dwt 2015 built Jingling was sold at $12.5 mln (vessel has SS/DD due and no BWTS). Always in the Handy segment, “Daiwan Braveabt” around 34k dwt 2014 built Namura was sold at $15.5 mln to Greek buyers. In the tanker market, after inspection was invited during June, it seems that the “Phoenix Vanguard” around 306k dwt 2007 built DSME was sold at $38.5 mln”, the shipbroker concluded.
Nikos Roussanoglou, Hellenic Shipping News Worldwide

Shipping’s Route To A More Sustainable Future

Today, 90 percent of all goods are transported via cargo ships, making them the top carrier of worldwide trade. In fact, the screen you’re reading this on at this very moment most likely made its way to you by sea.

Despite such ubiquity, the shipping industry produces less than 3 percent of all carbon dioxide (CO2) emissions. But with the global economy estimated to grow by 130 percent between now and 2050, shipping emissions are projected to soar as global trade increases. According to the International Maritime Organization (IMO), CO2 emissions could increase anywhere between 50 percent and 250 percent during that time.

CO2 is not the only environmental challenge the industry faces. Shipping also needs to control the amounts of other harmful substances its freight carriers release into the atmosphere, in particular nitrogen oxides and sulfur oxides.

To counteract this, shipping companies are seeking alternatives to the heavy fuel oils used by most carriers as well as ways to strip noxious particles from vessels’ exhaust gases.

New approaches with liquified natural gas

One of the most obvious alternatives to heavy fuel oils is liquefied natural gas (LNG). It’s already used as fuel by some 150 ships around the globe, and the numbers are growing, largely due to the near-zero levels of sulfur oxides (SOx) emitted by LNG vessels compared with diesel-powered ships. Sulfur oxides have been linked to both health problems (respiratory disease) and environmental phenomena (acid rain).

To cut its SOx emissions, the shipping industry has introduced restrictions in key shipping routes across the world. So far, the IMO has created four Emission Control Areas, ranging from the Baltic Sea to the coasts of North America, with a sulfur cap of 0.1 percent. The cap also applies throughout the European Union. In 2020 new IMO regulations will come into force mandating the sulfur content of marine fuels in all waters of the world to be less than 0.5 percent.

Ships have two options to reduce sulfur emissions within these limits. First, they can install desulfurization equipment, such as the Large-scale Rectangular Marine Scrubber developed by Mitsubishi Heavy Industries Group. It removes SOx from the exhaust gases emitted by marine diesel engines, purifying emissions from inexpensive heavy fuel oil to a level equivalent to more expensive low-sulfur fuels.

The second option is to use fuels with a lower sulfur content, such as LNG. As well as cutting a ship’s SOx emissions, LNG also has lower nitrogen oxide and CO2 emissions, making it a popular choice for shipping companies seeking to reduce their environmental impact.

MHI Group’s Large-scale Rectangular Marine Scrubber. Image: MHI GROUP

However, the growth of LNG as a shipping fuel is limited by a lack of infrastructure for fueling — or “bunkering,” as the LNG fueling process is known. Currently, only a dozen ports around the world offer bunkering, the majority based in Europe.

While more bunkering stations are planned, a major breakthrough occurred in 2017 when the world’s first purpose-built LNG bunkering vessel began operating from the Belgian port of Zeebrugge. The ENGIE Zeebrugge carries out ship-to-ship bunkering. Traditionally, LNG-fueled ships have largely depended on fixed bunker locations or the limited bunkering capacity of LNG trailers, but the ENGIE Zeebrugge can service a variety of these ships. This unique vessel is the start of what its operator, Gas4Sea, plans to be an LNG-bunkering fleet.

A return to electricity

Although LNG has advantages over diesel, there are also drawbacks. Not only is LNG dependent on widespread bunkering infrastructure, but it also pollutes more than diesel when it comes to one particular greenhouse gas: methane.

To avoid increasing methane emissions — which are 30 times more potent than CO2 in trapping heat in the atmosphere — some shipping operators are looking to emulate the auto industry’s shift to electric vehicles. Boats, in fact, used electricity before diesel; the Bergen Electric Ferry Company in Norway began operating in 1894. Its last boat with electric propulsion was converted to gasoline in 1926, and later to diesel. In 2015, the company returned to its roots, once again operating an electric ferry, powered by 12 5kWh lithium-ion batteries. The ferry runs all day and charges its batteries at night.

The rapid advances in lithium-ion battery technology, pioneered by the auto industry, have put the spotlight on electricity as a potential fuel source for shipping. However, regular nighttime charging is not an option for shipping liners traveling great distances, and the battery technology does not yet exist that could power these vessels.

One solution, again with a nod to the auto industry, may be hybrid electric vessels. Norwegian shipping company Eidesvik Offshore, which already runs its ships with LNG, successfully retrofitted a battery system in 2017 to its vessel Viking Princess. The ship now runs on a combination of a battery pack for energy storage and three LNG-fueled engines. The batteries are estimated to have cut Viking Princess’ fuel use by nearly a third and its emissions by 18 percent.

Shipping, which early on was powered by the wind and nothing more, has yet to return to its roots as renewably fueled transportation. But buoyed by ingenuity, it’s clearly sailing in the right direction.

Shipping Blockchain Initiative Gathers Steam

A blockchain initiative for seaborne cargo aimed at cutting costs and improving tracking of shipments is getting a boost with the addition of two big container shipping operations.

Germany’s Hapag-Lloyd AG and Japan’s Ocean Network Express said Tuesday they will join the TradeLens platform launched by A.P. Moller-Maersk A/S and International Business Machines Corp. , giving the program five of the world’s six largest carriers controlling about 60% of the oceangoing container cargo capacity.

Switzerland-based Mediterranean Shipping Co. and France’s CMA CGM SA, the world’s second and third biggest box-ship operators behind Maersk, joined the effort in May.

“Now, with five of the world’s six largest carriers committed to the platform, we can accelerate that transformation to provide greater trust, transparency and collaboration across supply chains and help promote global trade,” said Martin Gnass, managing director of information technology at Hapag-Lloyd.

For ocean carriers, blockchain technology allows participants to share information as goods move through maritime-focused supply chains.

The system also promises to reduce the cost of paperwork. Maersk said the maximum cost of the required documentation to process and administer many of the goods shipped each year makes up roughly one-fifth of the physical transportation costs.

Widespread participation across the supply chain is key to making TradeLens work.

Many companies, including transportation operators and freight forwarders that manage the flow of goods, have been reluctant to share detailed information about shipments, which often are handled by multiple cargo companies, for fear that competitors will use the data to lure away customers. The blockchain platform seeks to overcome that concern by allowing only trusted participants who contribute information to a common electronic ledger.

CMA CGM, the world’s fourth-largest container operator after Maersk, MSC and No. 3 Cosco Shipping Holdings Ltd. of China, late last year joined the Global Business Network, a similar blockchain initiative anchored by Cosco and other Asian carriers.
Source: Wall Street Journal