High waves, high claims. New study on container losses
Biogas can help global shipping go green
How innovation drives efficiency gains by eliminating the hub vortex
HERITAGE CORNER
Trust no ship without animals on board
The Port of HaminaKotka is a versatile Finnish seaport serving trade and industry. The biggest universal port in Finland is an important hub in Europe and in the Baltic Sea region.
Welcome to the Port of HaminaKotka!
Another issue – and another ‘smelly’ bundle of events hitting the fan, one could feel ‘encouraged’ to say. If it wasn’t enough for all the calamities in the Red Sea, a container ship tore down the Francis Scott Key Bridge in Baltimore in a matter of seconds, thus once again splashing the transport sector across mainstream media for all the wrong reasons. Oh, and we cannot forget that regionally much of Finland has recently been blocked for weeks when the new government and organised labour decided to butt heads (and the dispute hasn’t been settled yet). The curse “may you live in interesting times” just became outworn a wee bit more. That said, we have already seen such happenings (and many more) in the past. As Emanuele Grimaldi aptly put it when summarising Finnlines’ performance in 2023, “Shipping is never ‘business as usual.’ The shipping sector encounters many challenges beyond operators’ control. Conditions range from rough weather to strikes, political turmoil, congested fairways – the list is unending […].” In all probability, this list is also ‘timeless’ as long as people will continue transporting goods and themselves.
Other nuggets of folk wisdom come to mind when asking oneself what to do: “hope for the best and prepare for the worst” and “a pessimist is never disappointed” (ironically, the latter is brought up when trying to decipher what makes the Finns the planet’s happiest population). Whereas one could argue that ‘knowing more’ isn’t necessarily the key to success, ‘knowing better’ might very well come in handy. As such, the spring edition hosts several splendid reads that will give you just that. In Legal, specialists from Gard scrutinise the rise in container losses at sea, an occurrence that can only increase in frequency when carriers decide to omit the Suez Canal and embark on lengthier voyages in less friendly conditions navigation-wise. Two articles from CJC highlight how wars, blockades, ship bombings, and sanctions are changing the insurance landscape, as well as whether the Carbon Intensity Indicator is fit for purpose in its current form. Maritime puts the spotlight on how the hydrogen economy will unlock ammonia and methanol trades. Sustainability has got for your two extensive analyses from the Boston Consulting Group: on biogas and the little things that can throw a spanner in the works of the wind energy industry (a sector increasingly whetting the appetite of the port business – read more about that in the BPO Newsletter section). There is also a text about the progress (noticeable but nothing that would blow your socks off) and challenges (many a) towards the 5% scalable zero-emission fuels goal, followed by Bureau Veritas advising on the practicalities of navigating decarbonisation trajectories. Technology features two articles from FERNRIDE and Fraunhofer CML on the promises (noticeable and, to a certain degree, sock-blowing) and challenges (many a) of incorporating autonomous operations. DNV shows how to facilitate innovation that goes beyond regulations. As a case in point, EcoMarine Innovations presents their hydrodynamic solution that measurably increases propeller efficiency. To top things off, Youredi explains what stands behind the growing demand for actual CO2 emission data in ocean freight shipping (and how to make sure you’re getting it instead of [AI] estimations).
To top things off, I had the pleasure of visiting a museum on the full-rigged sailing ship Dar Pomorza in Gdynia to see why one shouldn’t trust a vessel without animals on board. The longerthan-usual and rich-in-unique photos Heritage corner will hopefully give you the answer.
And with that, I wish you nothing but the best reads and a bright springtime!
Przemysław Myszka
22 High waves, high claims
– New study on container losses by Kunal Pathak, Siddharth Mahajan, Are Solum, and Helge A. Nordahl 26 Maritime risk in conflict
– How wars, blockades, ship bombings, and sanctions are changing the insurance landscape by Richard Murray 28 Does it matter? – The Carbon Intensity Indicator by
30 From theory to practice
– The hydrogen economy gives ammonia and methanol export trades the green light by Stuart Nicoll
With a maximum lifting capacity of 1,600 tons, our travelling cargo crane TCC 78000 will drive your heavy-duty projects to success. www.liebherr.com
Maritime cranes
32 Biogas can help global shipping go green by Peter Jameson, Maurice Jansen, and Kevin Maloney
40 The hidden dynamics of the energy transition by David Young, Laura Larkin, Marielle Remillard, Alexandre Harry, Dan Eichelsdoerfer, Mark Falinski, and Juliana Sandford
46 Staying on track – Progress and challenges towards the 5% scalable zeroemission fuels goal by Ewa Kochańska
52 Navigating decarbonization trajectories
– Practical solutions and collaborative strategies for the shipping industry by Paul Delouche
56 The BPO Offshore Wind Conference by Monika Rogo
58 Technology Qualification
– Facilitating maritime innovation that goes beyond regulatory cover by Johan Iseskär
62 The Holy Boss Cap
– How innovation drives efficiency gains by eliminating the hub vortex by Dr Batuhan Aktas
64 The way to go (in spite of a few roadblocks)
– Results of a global survey on the current state of automation in container terminals & the trends shaping its future by Peter Szelei
68 Critical innovation
– Survey results on the adoption of autonomous maritime systems by Julius Küchle
70 To be (more) precise
– The growing demand for actual CO2 emission data in ocean freight shipping by Andrei Radchenko
Scandinavian Maritime Fair, 14-15/05/24, DK/Copenhagen, www.scandinavianmaritimefair.com
Scandinavian Maritime Fair recognizes the need of bringing together the Scandinavian maritime community. The aim is to unify and leave a lasting imprint on the world. Whether designers, manufacturers, suppliers, operators, shipowners, or service providers – both onshore and offshore – this is where industry leaders, young innovative companies and decision makers meet.
Ports 4.0 Conference , 5-6/06/24, LV/Riga
The fourth edition of the Baltic Ports Organization’s Ports 4.0 Conference will be held in Riga this time around. As always, the conference will focus on digitalization in the maritime sector.
TOC Europe 2024 , 11-13/06/24, NL / Rotterdam, tocevents-europe.com
With an unrivalled 40+ year heritage, TOC Europe is the place to learn from and network underneath one roof with the world’s leading port decision-makers, policy experts, solution-providers, and more, enabling you to both supercharge your strategies and make your port operation visions a reality. Whether your focus is on adapting to the unpredictable economic climate or simply embracing the exciting new technologies revolutionising the sector, join us on the road back towards growth at the essential container supply chain event.
Baltic Ports Conference 2024 , 4-6/09/24, LT/Klaipėda, www.balticportsconference.com
Join us this early autumn for yet another gathering of the Baltic port industry! This time around, we will focus on increased resilience and harmonized responses to geopolitical changes as the region’s maritime sector, seaports & shipping alike, is forging a new & greener business model.
AntwerpXL , 8-10/10/24, BE/Antwerp, www.antwerpxl.com/visit/register-your-interest
Hosted at the heart of the European breakbulk market, AntwerpXL – the award-winning breakbulk, heavy-lift and project cargo event – attracts 3,800+ attendees providing a distinctive platform for fostering trust-based relationships among visitors and exhibitors. With participants from 66+ countries and 100+ exhibitors, AntwerpXL offers access to a premium audience, enabling you to showcase your expertise, expand your network, and engage in quality-driven business interactions.
World Ports Conference 2024 , 8-10/10/24, DE/Hamburg, worldportsconference.com
2024 will be a pivotal year for ports and their communities. Geopolitical instability is on the rise. Physical and digital security is under threat, at sea and on shore. Shipowners, supply chain providers, and cargo owners must adapt rapidly. The energy transition towards low- and zero-carbon fuels must be balanced against national energy security concerns. #IAPH2024 will offer attendees insights on these topics, revealing how ports – from developing and developed nations – are building secure and sustainable solutions to these shared challenges, in a deeply interconnected world.
Bulk Terminals Antwerp 2024 , 23-24/10/24, BE/Antwerp, www.bulkterminals.org/index.php/events
The Annual ABTO Bulk Terminals Conferences are designed for all those involved in the transportation, storage and handling of bulk commodities. We welcome equipment and service suppliers, professional advisors, and academics to the conference in addition to terminals and ports. Indeed, ABTO strongly believes that bulk terminals will achieve increased operational efficiencies, safety, and environmental compliance only through interaction with these other organisations.
Out of 28 entries and then three shortlisted candidates, the judges decided to distinguish the product that came from the partnership between Cross Currents 88 (the solution’s developer) and G2 Ocean (a break-bulk shipping company wanting to increase the safety of vessel loading). The winning Spyder Netting is a thin layer of plastic film netting – a fall barrier system – that can be rolled out across gaps and secured between layers of cargo. The challenge stems from when paper reel products are loaded in the cargo holds of break-bulk vessels, with stowage resulting in gaps between the cargo (particularly along the hold edges where the freight meets the bulkheads). These gaps present a significant fall risk to stevedores working in the cargo holds. The gaps can extend many metres down through the cargo, and, unfortunately, falls into these gaps have resulted in fatalities and severe injuries. “Falls from height during cargo operations is a vitally important risk to be managed. Spyder Netting [...] has already saved lives. Cross Currents 88 has been personally thanked by a stevedore whose fall was arrested by the netting,” Richard Steele, CEO of ICHCA International, commented on presenting the award to Cross Currents 88-G2 Ocean. The two other shortlisted parties were Royal HaskoningDHV and Trendsetter Vulcan Offshore. The former entered Smart Mooring into the competition, a system addressing the safety of moored vessel operations in sheltered and exposed ports by predicting excessive ship motions and mooring line forces. The latter came with the Next Generation Lashing System that reduces container motion and controls the dynamics of container stacks. A detailed overview of all the entries can be found in a digest prepared by TT Club and ICHCA Mike Yarwood, TT Club’s Managing Director, Loss Prevention, underscored, “We want to nurture widespread and varied advances in safety innovation, so we seek to give all entrants the oxygen of visibility in the marketplace to help develop and grow their initiative to benefit cargo handling operations globally.” As such, his and Steele’s organisations will, for the third time, set up the Safety Village at TOC Europe this June.
The Maritime Technologies Forum (MTF), an organisation of Flag States and Classification Societies established to provide technical and regulatory expertise to benefit the maritime industry, has released the Guidelines in question with recommendations for developing and implementing the Safety Management System (SMS) under the International Safety Management (ISM) Code for safe onboard handling of the potentially more hazardous alternative fuels. “Safe operations with alternative fuels will require an assessment of the competency, training, familiarisation and resources relevant to the specific alternative fuels. The human element in the operations associated with the handling, storage and utilisation of alternative fuels is critical and should be considered
to ensure safe operations,” MTF underscored in a press brief. Nick Brown, CEO of Lloyd’s Register, added, “These guidelines and recommendations from the MTF are an important step forward to achieving safe and sustainable operations and a great starting point to begin preparing for the use of alternative fuels. The ISM Code provides a top-down approach to safety and is the ideal vehicle through which to drive training and skills for the safe handling of these fuels, not only under routine operations but also during emergencies such as equipment failures, fires, collisions, and malicious attacks. Our biggest strength, however, will be learning from each other throughout the energy transition, ensuring we have a solid foundation to promote safety for our people at sea and in port.”
The initiative – led by the World Shipping Council and supported by the United Nations Development Program, the Global Environment Facility, and the Global Wildlife Program, in collaboration with TRAFFIC and WWF, and co-sponsored by BIC, the Global Shippers Forum, the International Fund for Animal Welfare, and TT Club – saw the release of the Guidelines in question. This toolbox for all supply chain participants includes advice on measures to take, questions to ask to help identify criminal wildlife trade, and guidance on reporting suspicious activities. An accompanying Red Flags document serves as a daily reference for all individuals involved in the supply chain. “Maritime traffic, in particular, remains vulnerable to the trafficking of illegal goods. With the vast volume of trade carried by sea, the demand for faster, justin-time deliveries and the increasing complexity of intermodal supply
chains, criminals increasingly exploit weaknesses in global maritime supply chains to traffic contraband items,” the parties said in a press release. They also stressed, “Wildlife crime continues to pose a significant threat to biodiversity, local and national economies, as well as national and international security. The illicit trafficking of wildlife not only endangers countless species but also undermines the stability of ecosystems and jeopardises the livelihoods of communities worldwide. […] Illegal wildlife trafficking is not only decimating endangered species worldwide but also fuelling organised crime and threatening global security. The coalition’s joint effort underscores the shared responsibility of all stakeholders in combatting illegal wildlife trafficking. By uniting their expertise and resources, these organisations demonstrate their commitment to protecting wildlife and promoting sustainable trade practices.”
DFDS: 10,532 thousand lane metres filled in Q1 2024 (+9.2% yoy)
Counting 18 metres per truck/trailer, the fleet of the Danish shipping & logistics company carried just over 585k ro-ro cargo units over this year’s first quarter. At the same time, DFDS ferries served 1,114k passengers, up 79.7% on the January-March 2023 result.
Eckerö Line:
3,140,221 passengers served in 2023 (+20% yoy)
The company’s three ferries also transported 175 thousand ro-ro cargo units last year, a year-on-year increase of 11%.
Finnlines:
thousand private & commercial passengers served in 2023 (+7.3% yoy)
The company’s ferries also transported 157k private vehicles in 2023, up 13.8% year-on-year. At the same time, Finnlines’ fleet carried 710k ro-ro cargo units (-5.3% yoy) and 1,344kt non-unitised freight (-5.8% yoy).
29,399 thousand tonnes handled in 2023 (+5.3% yoy)
The Polish seaport’s leading trade, general cargo (excl. timber), totted up to 15,062kt (-3.1% year-on-year). It was followed by grains – 6,760kt (+42.7% yoy), liquid bulk – 3,541kt (+57.3% yoy), coal & coke – 2,825kt (-17% yoy), other dry bulk goods – 1,024kt (-29.4% yoy), timber – 178kt (-66.6% yoy), and iron ore – 8.0kt (+33.3% yoy). Gdynia’s 2023 container traffic reached 873,892 TEUs (-4.4% yoy).
61,252
Tonnage-wise, containerised freight going over Tallinn’s quays amounted to 506 thousand tonnes over January-March 2024 (+8.2% year-on-year). Overall, the Estonian port’s Q1 cargo turnover this year was flat at 3,364kt. Apart from freight in containers, the seaport also handled 1,666kt of wheeled (ro-ro & ferry) cargo (-3.7% yoy), 720kt of dry bulk (+36.8% yoy), 336kt of liquids (-34.7% yoy), 132kt of break-bulk (+26.7% yoy), and 4.0kt of non-marine goods (-81.8% yoy). Tallinn’s passenger traffic was up 4.9% on the Q1 2023 figure, totalling 1,465k ferry travellers. The Tallinn-Helsinki service attracted 1,317k passengers (+4.8% yoy), followed by 99k to/from Stockholm (-2.9% yoy), 41k between Muuga and Vuosaari (+50.7% yoy), and 9.0k classified as ‘others’ (-22.4% yoy). There was no cruise traffic in the first three months. At the same time, the Port of Tallinn’s domestic ferry traffic subsidiary, TS Laevad, transported 372k passengers (+6.1% yoy) and 191k vehicles (+5.7% yoy).
The Port of Kiel:
7.9 million tonnes handled in 2023 (+3.1% yoy)
While dry bulk turnover rose by 19% year-on-year to 1.48mt, general cargo handling was flat at 6.43mt (of which ro-ro & ferry cargo accounted for 6.38mt, down 0.3% yoy). Ro-ro cargo traffic totalled 182,555 trucks & trailers (-4.4% yoy). Container traffic totted up to 18,819 TEUs (-17.3% yoy). Intermodal rail traffic amounted to 21,672 cargo transport units (-25.1% yoy). The finished vehicle logistics sector handled 19,957 units (-1.2% yoy). On the other hand, Kiel’s passenger traffic advanced by 21.8% yoy to 2,824,318 travellers, of which the cruise sector accounted for 1,187,148 (214 calls).
Kombiverkehr:
815,467 truckloads carried by rail in 2023 (-15.9% yoy)
International transports totalled 628,611 truckloads (-17.5% year-on-year) while national (Germany) – 186,856 (-10.1% yoy). The Frankfurt-based company transported some 19 million tonnes last year.
1.68
Traffic to/from Tallinn gained 5.5% year-on-year, totalling nearly 1.36m ferry travellers, followed by Stockholm (+1.7% yoy to 285.5k), Travemünde (+5.4% yoy to 34.6k), Mariehamn (-17.3% yoy to 5,068), and 79 passengers classified as ‘others.’ The ships serving Helsinki’s ferry traffic brought fewer passenger cars, down 3.8% yoy to 269.9k.
On the cargo front, the Finnish seaport took care of 3.2 million tonnes (-8.9% yoy), of which exports amounted to 1.66mt (-9.3% yoy), imports – 1.47mt (-9.5% yoy), and cabotage – 73.7kt (+19.5% yoy). Unitised freight traffic totted up to 2.77mt (-4% yoy), of which wheeled (ro-ro & ferry) cargo accounted for 2.07mt (-1.1% yoy) and containerised – 700.9kt (-11.8% yoy). Dry bulk added 319.9kt (-15.3% yoy) and break-bulk - the remaining 94.6kt (-56.9% yoy). A total of 160,491 trucks & trailers went through Helsinki’s quays (-2.2% yoy). The port’s container traffic totalled 92,274 TEUs (-8.7% yoy).
The Port of HaminaKotka: 126,541 TEUs handled in Q1 2024 (-10.9% yoy)
The drop in container traffic, likewise in overall cargo turnover, stems from the weeks-long port strikes (which got temporarily halted on 8 April 2024). Back in January-February, the Port of HaminaKotka handled 35.4% more TEUs (up to 111,540) vs the first two months in 2023. In March this year, on the other hand, the volume dropped by as much as 72.4% year-on-year to 14,970 TEUs. The Finnish seaports took care of 2.89 million tonnes in international traffic in Q1 2024 (-24% yoy). Exports totted up to 1.96mt (-18.1% yoy) while imports to 931.4kt (-34% yoy). Cabotage was down 95.4% yoy to 3,007t. Meanwhile, the port hosted the FAM Trip for cruise lines organised by Cruise Baltic in late February 2024. “We had a great opportunity to show the cruise lines the same attractions their cruise guests are interested in. During a very short time, we were able to offer the main teasers of venues and tastes of the pearls of our destination and hope that this experience will lead to new cruise calls in our port,” Petra Cranston, the Port of HaminaKotka’s Project Manager – Cruise Business, underlined.
The Swedish agro-cooperative has spent SEK100 million (about €8.7m) on a ship loader and a cabin for its island grain terminal outside Norrköping. The investment has enabled the organisation to load vessels that can take up to 60 thousand tonnes. Lantmännen’s Djurön 35-metre-tall terminal comprises 20 silos and three dryers that together make it possible to handle 330kt of grains per year. The facility’s storage capacity amounts to 250kt.
The Danish shipping & logistics company has proposed DKK1.9 billion (€260 million) for the Turkish forwarder’s international transport network. Completion of the transaction is conditional upon EU merger control approval (the Turkish Competition Authority gave its green light in July 2023) and usual contractual conditions. Closing is expected around the beginning of Q4 2024. The transaction will be financed by a combination of loan financing and existing cash funds. Once approved, Ekol Logistics will become part of DFDS’ Logistics Division. In addition to operational integration, IT systems will be integrated (a process expected to take about three years). With Ekol Logistics, DFDS will grow with offices and facilities in ten European countries, including 26 warehouses with a total capacity of 120 thousand square metres (of which three-quarters are cross-docking terminals for part-load transports). Additionally, DFDS will gain Ekol’s equipment fleet, among others, 1,300 trucks, 3,900 trailers, and 600 containers. In 2023, the Turkish company employed 3,700 people. Ekol’s customers are mainly European and global manufacturers with production or assembly plants in Türkiye and Europe, as well as Turkish export companies. The primary sectors served are automotive, industrial parts, and textiles/garments. The top three cargo corridors are between Türkiye and Germany, Spain, and France, respectively. Ekol’s cargo flows are divided 60/40 between full- and part-load transports. Every four in five shipments uses some combination of road/rail/ferry transportation, making Ekol the largest customer of DFDS’ Mediterranean ferry route network (Ekol’s transport network builds on a partnership since 2019 with DFDS through a long-term customer agreement providing access to ferry capacity in the Med). The company also offers customs services. DFDS shared in a press release, “The Türkiye-Europe transport market is on average expected to grow by around 14% annually until 2028 (CAGR for 2020-2023 was 15%), and the acquisition thereby expands DFDS’ network to a highgrowth region supported by nearshoring of supply chains closer to Europe.”
Lantmännen has begun constructing its new facilities in the Swedish port: 21 silos and two dryers. The new set-up will provide 41 thousand tonnes of capacity for storing, drying, and shipping grains (some 100kt/ year) via the Port of Uddevalla. The SEK500 million investment (€43.2m), located in the Western Harbour, will be completed by the construction firm Tornum in 2026, replacing Lantmännen’s current one in the Inner Harbour.
The company has leased a silo from Benders Sverige in the Swedish port for storing merit, a slag-binder used in cement production. Merit, said to have a lesser impact on the environment than traditional binders, will be transported by ship from Swecem’s plant in Oxelösund instead of by trucks to further cut the carbon footprint. Deliveries from Swecem’s Uddevalla facility will commence in Q3 2024.
First, the cargo handling equipment fleet of PGE, a stevedore active in the Port of Gdańsk, is now bigger with two Liebherr LHM 280 machines. Each gantry offers a maximum lifting capacity of 84 tonnes and a 40-metre outreach. In tandem lift, they can pull up to 100t. The pair was deployed on the Szczecin Quay to handle project cargo, dry bulk goods, and containers. The cranes joined PGE’s three Liebherr LHM 550 received last year. Second, a 104-tonne lifting capacity mobile harbour crane of the LHM 800 model was delivered to Marcor’s Hartel Terminal in the Port of Rotterdam to handle upwards of 2,000t per hour of various dry bulk goods. The machinery has a boom of 64 metres and offers a 30.8-metre eye-level height. An electric drive unit powers the crane. Additionally, Marcor’s new mobile harbour crane features Liebherr’s SmartGrip technology. This system optimises the grab entry angle and adapts to the bulk material in use without the need to change the grab. SmartGrip also fills the grab based on an optimum load graph, reducing overload and its effects on the crane’s structure. A second LHM 800 will be delivered to Marcor later this year.
The 1979-built Hamnen underwent conversion at the Ö-varvet shipyard by getting a 250kW motor and 520kWh battery pack in place of a diesel engine. The Port of Gothenburg underlined in a press release, “Hamnen is in active operation for approximately 1,200 hours per year. With the previous engine, the vessel consumed 25,000 litres of diesel, resulting in 67 tonnes of carbon dioxide emissions – equivalent to 15% of the Gothenburg Port Authority’s total emissions – which are now eliminated.” The battery system can be expanded if need be, plus there’s an auxiliary diesel engine as a backup. The 20.3 by 5.7-metre vessel is charged via a 125-amp charger at its home quay. The conversion investment totalled SEK19.8 million (around €1.7m).
The dry bulker constructed by the Dutch Royal Bodewes is the first in a series of two 5050 Eco Traders. The Ice Class 1A, 5,000 deadweight, 90-metre long dry bulker for the Karlstad-headquartered Swedish shipping line, has been granted the Cleanship notation by Bureau Veritas. The delivery of the sister ship is scheduled for Q4 2024.
The Organization will spend some €160 million on setting up the necessary infrastructure in the Port of Liepāja. The investment will comprise new berths, supporting infrastructure, and dredging works. The new naval base will be erected at Karosta, which has already housed a military harbour in the past. The Baltic Times reported that the Latvian Ministry of Defence announced in 2020 its intention to establish a 35-hectare military base in Liepāja.
First, construction has started at Verdo’s new premises. The Danish seaport will house the 13,700 square metre-big facility of the Randersbased Verdo Energy Systems, a developer of green energy plants. The investment, located within the Anchor business area at East Port, is scheduled to come online in H2 2024, with Verdo moving in at the beginning of February next year. Next, Scandinavian Medical Solutions, a sales provider of high-quality pre-owned medical imaging equipment, has leased 1,263 m 2 of warehouse facilities and 153 m2 of office space in the general cargo area of the Port of Aalborg.
Energos Infrastructure’s 174 thousand cubic metres of capacity floating storage & regasification unit (FSRU) Energos Power berthed at Deutsche ReGas’ terminal in Mukran Port. The FSRU afterwards underwent tests, feeding the German market with the Norwegian gas it received. Another FSRU, the docked in Lubmin Neptune, is to join Energos Power this spring.
As of 10 April 2024, Finnlines’ ro-pax Finnfellow sails daily between the ports of Malmö and Świnoujście. The 2000-built ferry, previously serving the Malmö-Travemünde crossing, offers room for 440 passengers and 3,099 lane metres for cargo. Morning arrivals & departures take place in the Swedish seaport, while Finnfellow arrives & leaves the Polish one in the evenings. “The launch of a new route will benefit Swedish and Polish exports and imports and expands Finnlines’ operations outside Finland, as well as confirming Finnlines’ commitment to Polish security of supply by calling both the Port of Gdynia and […] the Port of Świnoujście. We have already strengthened the shore organization and opened an office in Świnoujście,” Antonio Raimo, Line Manager at Finnlines, commented. Marco Palmu, Head of Finnlines Passenger Services, added, “Finnlines has prepared the launch of a new line between Sweden and Poland thoroughly. We can offer spacious decks for cars and freight. Passengers and drivers have a quick and easy entrance to the accommodation. The sea voyage will surely be comfortable.”
The seaport in Northern Sweden is now part of the Sweden Finland X-PRESS (SFX) service, operated by the 1,036-TEU Phoenix J. The rotation links the Baltic ports of Piteå, Tornio and Oulu with Hamburg and Wilhelmshaven.
The company has added the Port of Klaipėda to the roster, exchanged Hull for Immingham, and increased the capacity by deploying two 803-TEU carriers. The service now connects the Baltic ports of Helsinki, Riga and Klaipėda with Rotterdam and Immingham.
Ellerman City Liners has kicked off the Poland Express Service (iPEX), which connects the ports of Gdynia and Tilbury on a weekly basis. The 966-TEU Nova serves the crossing. iPEX joined Ellerman’s first Poland-England service (Gdynia-Teesport).
The all-electric passenger-car ferry for the Danish Alslinjen (subsidiary of Molslinjen) has been launched at the Turkish Cemre Shipyard, with delivery planned for later this year in August. The 116.8-m long ferry will offer room for 600 passengers and 188 vehicles across the Fynshav-Bøjden crossing. Nerthus will feature technology for automatic docking and charging its 3.1 megawatt-hours battery system (supplied by Echandia). Cemre Shipyard is also constructing Tyrfing, a sister ship for the Ballen-Kalundborg link (as the service is longer, she’ll have a bigger battery pack of 3.8MWh).
The Swedish shipping line has taken a 49% stake in the Tanger-based company that offers a ferry service between Tanger Med and Algeciras. The crossing is operated by two ro-paxes: Morocco Sun (room for 1,001 passengers and 850 lane metres for cargo) and Morocco Star (935 pax/755 lm), both built in 1980. Additionally, Africa Morocco Link will kick off the Tanger VilleTarifa high-speed route for passengers and private vehicles this summer.
Meanwhile, Stena Line sold Sea Lines the ferry that was recently chartered to TT-Line and which previously served Stena’s Hanko-Norvik service (discontinued in the autumn of 2023). The ro-pax offers room for 186 passengers and 1,598 lane metres for wheeled cargo. Sea Lines operates a route between the Romanian Constanța and the Turkish Karasu.
The order is for 13 multi-system locomotives homologated for rail traffic in Austria, Belgium, France, Germany, Luxembourg, and Poland. The contract also includes two years of preventive maintenance during the warranty period. The Alstom site in Kassel will produce the units, while the company’s facility in Wrocław will manufacture the locomotive bodies. The producer underlined in a press release, “The third-generation Traxx multi-system locomotives […] are designed to handle heavier loads compared to other locomotives in the same class. Units ordered by the CLIP Group can reach a top speed of 160 km per hour. [They] will be equipped with the leading signalling system Onvia (formerly known as Atlas), Alstom’s onboard solution for the European Train Control System (ETCS).” Agnieszka Hipś, CEO of the CLIP Group, underscored, “Following the expansion of our Intermodal Terminal in Swarzędz, the purchase of modern multi-system locomotives is another milestone in the development of the CLIP Group. As our terminal has eight reloading tracks, with an annual capacity of over 1 million TEUs, and our own fleet accounts for 500 intermodal wagons, it has been natural for us to invest in our own locomotives.”
The Luxembourg rail freight haulier has homologated eight Alstom Traxx MS3 locomotives for operations across its Germany-LuxembourgPoland corridor. The company plans to homologate its locomotives for running also in Austria, Belgium, and France. CFL cargo’s Traxx MS3s are hybrid locomotives, making them possible to run across non-electrified railways. The company will use the machines to pull intermodal and conventional train sets. Max Solvi, COO International, CFL cargo, commented, “One of our biggest competitive advantages is the quality of service we provide by combining our conventional services with our intermodal services, which in turn makes us a strong cross-border operator. With our new Traxx MS3 locomotives, routes such as Poznań-Bettembourg will benefit greatly: where we had to switch out locomotives in the past, we will now deploy only one engine for the same distance, which will increase reliability. This is an additional argument to promote the modal shift from road to rail among road transport companies and logistic service providers.”
• A number of Latvian, Norwegian, and Swedish companies have formed CIS Liepāja, a joint project management team to scrutinise the set-up of a power-to-X complex in the Port of Liepāja. The Liepāja Special Economic Zone (SEZ) and CIS Liepāja have concluded a two-year reservation contract for the potential construction site.
The 1,000MW plant, capable of producing 150 thousand tonnes of hydrogen yearly, will feature a sea terminal. The total investment is estimated to be around €1.0 billion. Liepāja SEZ has also mentioned that the Dutch Fokker Next Gen intends to establish a hydrogenpowered aircraft assembly plant at the Liepāja Airport. •
• X-Press Feeders and six North European ports – Antwerp-Bruges, HaminaKotka, Helsinki, Klaipėda, Riga, and Tallinn – have joined forces to establish two North Sea-Baltic green (methanol) corridors. Following the agreement, X-Press Feeders will, as of Q3 2024, run two sea container routes powered by green methanol. The Green Baltic X-PRESS (GBX) loop will connect the ports of Rotterdam, AntwerpBruges, Klaipėda, and Riga. The Green Finland X-PRESS (GFX) service will link Rotterdam, Antwerp-Bruges, Helsinki, Tallinn, and HaminaKotka. X-Press Feeders’ green methanol, made from green hydrogen and the decomposition of organic matter (waste and residues), will be sourced from the fuel supplier OCI Global (whose green methanol is certified by
the International Sustainability and Carbon Certification Association). X-Press Feeders says that green methanol as an alternative marine fuel produces at least 60% less greenhouse gas (GHG) emissions vs conventional bunker. Additionally, the parties will work together to further develop infrastructure for the provision and bunkering of alternative fuels; encourage the development of supply chains for fuels that are zero or near-zero in terms of GHG emissions; provide further training programmes for port workers and seafarers with regards to the handling of alternative fuels; leverage digital platforms to enhance port call optimisation; and hold regular meetings to update and discuss progress on actions to continue developing green shipping corridors.
•
• The ports of Lübeck and Trelleborg, the port operator LHG, and the ferry company TT-Line have partnered to make the crossing fossil fuelfree by 2040 at the latest. The parties underlined in a press release, “The cooperation will not only serve as an innovative platform and exchange of information, but the aim of all partners is to decarbonize transport in
the partners’ direct sphere of influence as well as to influence the entire transport chain of the goods in question.” The first initiative across the Lübeck-Trelleborg Green Shipping Corridor will see the set-up of additional onshore power supply connections in both seaports. At the same time, TT-Line will retrofit four of its ferries with cold ironing connectors. •
• MaserFrakt, a road haulier from Borlänge, started operating its first (out of two ordered) diesel-turned-hydrogen fuel-cell DAF lorry. The other one, also converted by the Dutch Holthausen Clean Technology, will arrive later this year. Both offer a range of up to 680 kilometres. The Swedish retailer ICA employed MaserFrakt’s first hydrogen truck to transport goods between its regional warehouse in Borlänge and shops in Dalarna, Västmanland, and Gävleborg. Per Bondemark, MaserFrakt’s CEO, commented, “It is highly satisfying that we received our first hydrogen truck. The second will arrive
later in the year. But it’s just the beginning. Should these two run well, we intend to exchange many of our diesel lorries for hydrogen vehicles.” The company has also commissioned a hydrogen tanking station (at the final expense of SEK17.7 million, approx. €1.55m, up from the 2020-envisaged cost of SEK11m, €960k). The Borlängelocated facility went into operation towards the end of February 2024 (around one year later than initially planned). The Climate Leap investment programme of the Swedish Environmental Protection Agency supported the set-up. •
• The Port of Hanko and the Euroports Group have signed a letter of intent to establish a hub for the offshore wind energy supply chain at the former’s Koverhar Harbour. The parties underlined that 600 hectares of the Koverhar Harbour are available for future industrial development, of which 90 ha are dedicated to direct port activities. Euroports Finland highlighted in this regard, “The initiative is looking beyond the logistical challenges. It aspires to cultivate an entire green ecosystem within its considerable back-land area. Euroports’ deep, long-standing experience as a terminal operator, associated with a strong track record in both the onshore and offshore wind industry, allows our teams to handle the full value chain, including freight forwarding through our subsidiary Manuport Logistics.” •
• The company has signed an agreement with the Liepāja Special Economic Zone, following which it’ll scrutinise the set up of an offshore wind energy (OWE) support base and cargo terminal. Over the next two years, Van Oord will carry out the preparatory work,
including research, business plan development, and technical design elaboration. If everything goes according to plan, construction will kick off in 2026, with the OWE support base coming online in mid2027. •
• The steel cutting ceremony for the first – in a series of two – 500-TEU vessels took place at Cochin Shipyard in India. Once delivered, the 3.2-megawatt fuelcell, 135-metre long duo will serve the Oslo-Rotterdam crossing, sailing on
green hydrogen and thus sparing the environment some 25 thousand tonnes of CO2 emissions per year. The pair was ordered by Ocean Infinity, scheduled for delivery in 2025 and operated by Samskip under a long-term charter. •
• The parties will explore the opportunities to fuel Wasaline’s ferry Aurora Botnia with e-methanol to be produced by Liquid Wind’s FlagshipTHREE
facility in Umeå. The plant in question can be up & running in 2027, supplying some 100 thousand tonnes of e-methanol per year. •
• The German provider of tech for synthetic methane production and the Swedish shipping line have entered off-take negotiations. The talks concern e-methane production by Electrochaea’s Danish subsidiary, BioCAT Roslev, which is working on establishing a powerto-gas facility in the municipality of Skive. There, renewable wind
power will be used to produce green hydrogen that will be mixed with the CO2 from biogas production at Rybjerg Biogas in a bioreactor to produce e-methane using Electrochaea’s patented bio-methanation technology. Erik Thun plans to use Electrochaea’s RFNBO-compliant e-methane to replace liquefied natural gas as a marine bunker. •
• The Port of Gothenburg, Skanska, PowerCell, Hitachi Energy, Linde Gas, Volvo, and Skagerak Energi used Hyflex, a containerised hydrogen fuel cell & battery, for heavy-duty construction needs. The 100kW fuel cell by PowerCell – with green hydrogen provided by Linde Gas and Hitachi Energy supplying the generator to produce electricity from hydrogen –was used on 4-17 March 2024 on the Arendal 2 construction site to run a Volvo excavator. The plug-and-play solution includes fuel cell modules,
power electronics, cooling, auxiliary systems, and an intelligent control system. Richard Berkling, CEO of the PowerCell Group, highlighted, “The Hyflex has the potential to replace diesel generator sets across multiple platforms, as well as take on new power generation applications. The current demonstrator has been developed with construction sites in mind; however, we also recognise the need for marine and port electrification applications, such as sustainable ship-to-shore power.” •
• The Polish Development Fund (PFR), a 30% shareholder in Baltic Hub, plans to spend PLN500 million (€116m) on setting up a dedicated installation & maintenance quay in the Port of Gdańsk. The 21-hectare investment catering to the offshore wind energy
(OWE) industry is planned for completion in 2026, with construction works kicking off in mid-2024. It will comprise two 17.5-metre deep berths: 451 m for installation and 349 m for maintenance purposes. Additionally, the terminal will include a ro-ro berth. •
• Volvo will deliver the FH Electric and FM Electric models, upping the Danish shipping & logistics company’s heavy-duty electric truck fleet to 225. Already, 95 e-trucks are running across Belgium, Denmark, Lithuania, the Netherlands, and Sweden, with the remaining 35 due for delivery this year. The newest batch will be deployed in Ireland,
Norway, and the UK. DFDS’ e-truck fleet, the biggest one in Europe, will help the company become net-zero by 2050. DFDS shared that the e-truck investment (October & December 2021) reduced its greenhouse gas emissions by 1,516 tonnes (well-to-wheel) by the end of 2023. The company plans to have at least 25% of its truck fleet electrified by 2030. •
• The logistics company from Sweden will see the Swedish coffee maker’s shipments carried by vessels using bio-liquefied natural gas (bioLNG) per the mass-balanced approach. This move will reduce Löfbergs’ sea freight carbon footprint by 100%. The company, which will pay for bioLNG, imports some 36 thousand tonnes of raw coffee each year. Kajsa-Lisa Ljudén, Head of Sustainability at Löfbergs, commented, “Biogas costs more than fossil fuels, but we think we cannot afford to do otherwise. We have to reduce emissions across the entirety of
our value chain. That we are financing the fuel switch 100% means that we see a functioning solution, which will hopefully contribute to others making a change, too.” Matilda Jarbin, Scanlog’s Chief Sustainability & Communications Officer, added, “Sea transportation has long found itself under the radar. It is, therefore, important that companies like Löfbergs dare to go further, seeing it’s possible to reduce emissions here & now. We hope this will inspire other firms, speeding up the necessary transition within the transport sector.” •
• The Danish seaport will house a 5.0-megawatt electrolyser facility of Norwegian Hydrogen, set to produce 500 tonnes per year. The decision follows the authorisation of a €9.0-million grant by
Horizon Europe for the five-year CONVEY project, which aims to establish an integrated hydrogen ecosystem at the Port of Hirtshals. •
• The developer of offshore wind energy (OWE) and the Finnish Port of Vaasa signed a letter of intent concerning the construction, operations, and maintenance of the Tyrsky OWE farm. The partnership follows a similar one between the two around the Laine OWE farm. Tyrsky will be located 30 km off Kaskinen, comprising 95 turbines generating 6.0 terawatt-hours/year (around 8% of Finland’s electricity demand in 2023). Laine, situated 32 km off Pietarsaari, will have 150 turbines (11TWh/y). The company also works on a third OWE project in the Bothnian Bay: Halla (35 km off Raahe, 160 turbines, 12TWh/y). OX2 has signed similar agreements with other Finnish seaports: Kaskinen, Kokkola, Pietarsaari, and Raahe.
Mathias Skog, OX2’s Tyrsky Project Leader, commented, “Ports are essential partners for the development of offshore wind energy, and their infrastructure plays a vital role in carrying out projects. The letter of intent gives way to a more open discussion not only concerning the needs and plans for offshore wind energy farms but also about the port’s role and its development needs.” He furthered, “It is crucial for us to cooperate with local partners and, in this way, secure smooth construction and operations once we have come this far. OX2 is committed to developing offshore wind energy projects in the Bay of Bothnia, a critical element of increasing domestic production of renewable power.” •
• Liquid Wind, Alfa Laval, Carbon Clean, Siemens Energy, and Topsoe inaugurated their Design & Performance Centre (DPC), tasked with driving technological progress, strengthening production capacity, and bringing in-demand e-fuels to market at scale. Specifically, the joint research & development department will work on blueprinting ready-to-build e-methanol plants (capacity of producing 100 thousand tonnes of e-methanol per year). In November 2023, the parties teamed up to reduce the time, cost, and risk of developing such plants, with plans to get ten additional e-methanol facilities in the Nordics by 2027 and a total of 80 standardised, 100kt/y capacity e-methanol units by 2030 (estimated to reduce CO2 emissions by 14 million tonnes yearly). •
• The Finnish manufacturer of auxiliary wind propulsion will see one of its Rotor Sails installed on board Baltrader’s under-construction in China cement carrier. The 24-m-tall and 4-m-diameter gear will reduce CEMCOMMANDER ’s fuel consumption by up to 14%. The
investment will be supported by the German Federal Ministry of Digital and Transport through its Sustainable Modernisation of Coastal Vessels funding directive. Bureau Veritas will classify the wind propulsion system, and the ship will get the WPS2 class notation.
•
• The Aarhus-headquartered feeder & short-sea shipping line has secured the long-term charter for another pair of 1,250-TEU-capacity carriers. The deal comes atop the October 2023 agreement for an identical duo. All four are scheduled for delivery in 2026, with three
coming from the German Elbdeich Reederei and the remaining from the Norwegian MPC Container Ships. Unifeeder will use the container vessels in its decarbonisation plans, reducing its carbon footprint by 25% by 2030 on the company’s way towards net zero in 2050. •
www.ttline.com/en/freight
Świnoujście Rostock Trelleborg Klaipėda Travemünde Karlshamn8
1
• Carbon intensity of the grid determines the carbon intensity of electrified applications
• Most grids have low integration of renewable energy capacity
Vehicles with onboard methanol reformation incur LOWER CAPEX and OPEX for LONGER RANGE, SHORTER REFILL TIME, and LOWER EMISSIONS
7
As the , methanol is:
• Simple – Stored and transported as a liquid
• Efficient – Highest hydrogen to carbon ratio of liquid fuels
• Green – A pathway to carbon-neutral transport
• Now – Immediate solution for the adoption of hydrogen
6
• Bio-methanol produced from MSW can produce H2 at a carbon intensity of
2.15 kgCO2eq/kg of H2 = 90% GHG SAVINGS
compared to electrolysis.
3
2
• Renewable energy generation has to be
5
larger than electricity demand to address intermittency
• Cost to integrate fully renewable grids: X3 or X4
>USD 4.5 trillion
>USD 3.6 trillion
>USD 11 trillion
• Rising cost of electricity brings cost of H2 to >USD 3.5/kg
(based
4
• Electrolysis of water requires of H2
• H2 produced is not green with a carbon intensity of
50 – 55 kWh/kg 21 kgCO2eq/kg of H2
(based
• Methanol has a low carbon intensity, and can be carbon-neutral, when produced from sustainable feedstocks such as municipal solid waste (MSW), agricultural waste, and captured CO2
The World Shipping Council (WSC), backed by a number of heavyweight carriers, has tabled the Green Balance Mechanism to even out the price spread between fossil and low/zero-emission marine fuels. “The global shipping regulator, the UN International Maritime Organisation, has set a target of net-zero carbon emissions by 2050 for the industry, and now needs to develop climate regulations by 2025 that make it possible to reach that target. A core challenge is how to craft a global greenhouse gas pricing regulation that can bridge the price gap between the cleanest fuels and fossil fuels, driving investments in green fuels, without imposing an outsized cost on the global economy,” said WSC in a press brief. Through the proposed Green Balance Mechanism, fees are taken from fossil fuels and allocated to green fuels used so that the average cost of fuel is equal. The greater the greenhouse gas (GHG) emission reduction a fuel delivers – on a well-to-wake lifecycle basis – the greater the financial allocation
received. The monies collected in any given year are determined by the amount of green fuels used, allowing for a relatively low fee at the start of the transition. The minimum fee necessary to offset the price differential in a given year is collected and allocated to ships using green fuels that meet a specific GHG threshold: this ensures that green fuels can be produced and used and does so with the least possible cost to transportation. The emission reductions required for fuel to receive a price-balancing allocation are linked to IMO decarbonisation requirements (increasing in stringency towards the 2050 net-zero goal). WSC also says its Green Balance Mechanism is adaptable and fully integrated with a GHG fuel-intensity standard. It can be used as a targeted GHG pricing mechanism or a possible addition to an integrated measure. The organisation also underlines that other fees can be added to raise funds for climate mitigation initiatives and research, development & demonstration projects to provide a just and equitable transition.
The European Climate, Infrastructure and Environment Executive Agency, through its Connecting Europe Facility (CEF), has published a new call for proposals under the Alternative Fuels Infrastructure Facility (AFIF). The aim is to support the deployment of alternative fuel supply infrastructure, contributing to the decarbonisation of transport, including the maritime sector, across the Trans-European Transport Network. This call targets supporting high-power electricity recharging stations; hydrogen refuelling stations; megawatt recharging stations for heavy-duty vehicles; and electricity supply, and ammonia and methanol bunkering facilities in seaports (and electricity and hydrogen supply at airports). The €1.0 billion budget
is divided into two parts: €780m allocated to the ‘General’ and €220m to the ‘Cohesion’ envelopes. The call for proposals has three cut-off dates for submissions: 24 September 2024, 11 June and 17 December 2025. “The increasing number of applications for the Alternative Fuels Infrastructure Facility confirms the relevance of this funding tool for the European transport sector,” underscored Adina Vălean, EU Commissioner for Transport. She furthered, “This can be an important gap bridging for the massive investments needed to deliver a sustainable and accessible electric vehicle infrastructure, and I strongly encourage all Member States, and in particular those in Eastern and Southern Europe, to make use of it.”
The Danish Ministry of Environment under Magnus Heunicke is scrutinising whether to ban the release of scrubber wash water within 12 nautical miles of the country’s territorial waters. The Ministry is particularly concerned with the presence of heavy metals and tar substances in scrubber wash water (lead, cadmium, nickel, anthracene, and benzo(a)pyrene). “When heavy metals and tar substances are discharged to our marine environment, they do not disappear and remain in constant circulation in the sea,” Heunicke said in a statement. He added, “The substances accumulate on the seabed and in the food chains of the sea, and this is deeply worrying about our marine environment and our health.” The Environmental Protection Alliance has welcomed the considerations and
said the Danish ban on scrubber wash water could be enforced from 1 July 2025. The organisation has calculated the costs associated with the banning for the shipping industry and equipment manufacturers: one-off of $5.7 million and $2.8m annually, adding at the same time “[…] the price that the environment has had to pay far exceeds the value for shipping companies to fund its recovery.” Reporting on the possible ban, Ship & Bunker mentioned a scrubber industry-funded research on the environmental impact of wash water in 2021. According to the report, there was no toxicity impact on fish, while there were some short-term effects on algae and crustaceans in high concentrations. The report also characterised the risk to the aquatic environment as acceptable.
EcoVadis, ENGIE, Hitachi Energy, Siemens Gamesa, Statkraft, WindEurope, and Vestas have joined forces to identify and adopt common sustainable business practices to enhance supply chain transparency and improve the wind energy sector’s environmental-social-governance (ESG) performance standards. To that end, the members of the Wind Energy Initiative have set four strategic goals forth. First, they want to bolster the wind industry’s contribution to the global effort in combating climate change by prioritising carbon emission reduction, emphasising the integration of renewable energy, and embracing circular practices. Second, to continue advancing the well-being and fair treatment of all individuals involved in the wind energy supply chain. Third, to promote biodiversity conservation to protect ecosystems impacted by activities related to the wind energy sector. Lastly, to foster substantial membership growth in the coming years. To achieve these goals, the Wind Energy Initiative will
implement the EcoVadis sustainability ratings methodology as a voluntary standard for assessing their suppliers and supporting them in their sustainability journey by communicating a clear strategy and targeted enhancements to drive their ESG performance improvement. Meanwhile, the European Commission has launched an inquiry into Chinese suppliers of wind turbines under the new Foreign Subsidies Regulation. Giles Dickson, CEO of WindEurope, commented, “Chinese wind turbine manufacturers are offering much lower prices than European manufacturers [up to 50%] and incredibly generous financing terms with up to three years deferred payment. You can’t do that without unfair public subsidy. What is more, the European manufacturers aren’t allowed to offer deferred payment like that under OECD rules.” Announcing the inquiry, Margarethe Vestager, EU Commissioner for Competition, said that the EU must avoid repeating the mistakes it made in losing its solar manufacturing industry.
In a comprehensive new study, we delve into the impact of weather on container stack collapses. Our findings show the impact of progressively increasing wave height, the quantified risk of high waves, and variance in weather exposure among different operators. Hopefully, the study sets the stage for a deeper dialogue within the industry about mitigating the impact of adverse weather on container safety.
As the world economy develops, the volume of containerised trade increases steadily. Last year, the global container shipping fleet grew by almost 4%, according to UNCTAD, and in Gard’s P&I portfolio, the segment has increased by as much as 16% over the past five years. It currently makes up 18% of our insured vessels.
With more container shipping comes also a higher risk of casualties. Certain incidents, such as stack collapses or containers lost at sea, are closely monitored as they tend to be relatively more severe. Container losses also have the International Maritime Organization’s attention, and they are working on making reporting of lost containers mandatory. Meanwhile, insurers and other key stakeholders are involved in detailed work, such as the Top Tier project , to investigate the causes of stack collapse and seek solutions.
To contribute to the industry understanding and help prevent losses, we have studied all cases of stack collapse where Gard was involved as a P&I insurer. These cases occurred between 2016 and 2021, and we have looked at the weather data to make sure we understand the factors contributing to these incidents. More specifically, we have combined Gard claims data with geographical and meteorological
data from Windward, which includes estimated wave height and wind strength on an hourly basis. Several measures are common when it comes to waves. For this study, we have used the maximum wave height.
Our claims data includes a wide selection of cases, both when it comes to severity, vessel size, and geographical location. For each claim, we have collected meteorological data for the incident date as well as the six days leading up to the day of the incident. This allows us to analyse how the weather progressively worsened over the given period.
Impact of vessel’s size
Weather needs to be seen in the context of the ship’s design and size, of course, although we do see that container stack collapses happen across different-size segments. This just underscores the fact that several causative factors are usually involved in these incidents, as highlighted in our article Why do container ship stacks collapse, and who is liable?
Analysing incident numbers relative to number of vessels in our portfolio provides valuable insights on claims frequency across different size segments, which can range from feeders (less than 3,000 TEUs) to ultra-large container vessels (ULCVs) exceeding 15,000 TEUs where the stack heights can exceed ten-high on deck.
Despite a higher number of incidents on smaller ships, there is a clear correlation between incident frequency (or likelihood) and vessel size, as depicted in Figure 1. The 6-year average claims frequency for stack collapses on feeder vessels is 1%, whereas for ULCVs, it rises to 9%.
When looking at a 7-day period before the incident, we noticed that on Day 1, vessels are, on average, experiencing wave heights of 2.5 metres, which corresponds to a wind force of 5 on the Beaufort scale. The weather then progressively worsens, and this increase in wave height is more pronounced from Day 6 onwards – the average wave height peaks on Day 7 at 6.5 m, which corresponds to gale force winds. The duration for which the vessels were exposed to sea conditions with wave heights of 4 m and above (corresponding to near-gale force winds or stronger) was 72 hours.
We underline that these are the average wave heights of all vessels that had a stack collapse incident. If we look at each ship separately, many of them were exposed to these conditions for a much longer duration of time. During the 7-day period we examined (which is also shown in the graph below), the “incident zone” for the majority of the incidents was a 24-hour window on the last day.
Source for all figs.: Gard
It was, therefore, evident that the vessels experienced average wave heights, which progressively increased by two and a half times during the 7-day period. Interestingly, the incidents did not always happen when the wave height was the highest but after the weather had started to subside. This might be partly due to the fact that the time of reporting the incident to Gard may not always coincide with the time of the incident itself.
To further study the exposure to high waves, we looked at vessels that are exposed to a wave height of 7 m (corresponding to Bf 8 gale force winds) or above. An observation of interest was that while vessels involved in incidents spent only 5% of their time in wave heights exceeding 7 m during the incident year, half of all incidents occurred during such conditions. Analysing the maximum wave heights
experienced by vessels on the day of the incident, as shown in Figure 3, reveals a similar pattern. Essentially, despite spending 95% of their time in calmer waters, the relatively small percentage spent in adverse conditions significantly amplifies the risk of incidents, potentially up to 20 times higher, as indicated by our study.
Another finding we had was that among the vessels that had a stack collapse incident, the share of ships exposed to such high waves increased by almost 12 times from day 1 to day 7. This suggests that these vessels may not have been able to avoid such heavy weather in spite of the advanced weatherrouting tools available.
Examining the global container fleet, roughly 3.4% are exposed to such weather at any given time. Interestingly, among various size segments, the new Panamax 1 segment (8,000-12,000 TEUs) appears to have a higher exposure to wave heights of 7 m and above compared to any other size category. This trend is also evident for wave heights around 4 m.
The variation in exposure to adverse weather is not only limited to different size segments in our container fleet. From our study for the period 2016-2022 for the global container fleet, we also see that some container operators or owners are more exposed to the risk of adverse weather than others.
In essence, this discrepancy likely stems from differences in operators’ risk tolerance and the internally defined weather thresholds for the vessels. However, the consequences of decisions made in the chartering or the operator’s desk are pretty evident in the safety of the ship and the cargo.
Exposure to progressively worsening weather poses a clear risk, and our studies highlight two crucial aspects in this regard. The first involves the duration of exposure, while the second concerns weather thresholds, such as maximum wave height for a vessel, influenced by factors like stability, stack height, and physical condition of the securing equipment. Based on our study findings, there are key questions to be considered by the various stakeholders working in the liner industry.
Does the understanding of the weather limiting factors, such as maximum wind and wave height for a voyage, vary among different stakeholders, and if so, why?
Conflicting priorities may arise between a commercial operator and a vessel’s master regarding voyage routing. While a master might prefer a slightly longer route with less exposure to adverse weather, a commercial operator might prioritise time and fuel savings, potentially pushing the limits. Additionally, we’ve noted that routing advice to a vessel could vary based on whether their principal is a charterer or owner.
Another variable to consider when determining weather thresholds is the vessel’s stability, which may be different from the loading computer calculations, given the misdeclaration of weights and/or a mismatch in stowage location.
Do seafarers have access to suitable digital/automated tools for evaluating the risk of intricate phenomena like resonant, synchronous, and parametric rolling?
The term “adverse weather” is subjective to seafarers. Often, advice on mitigating the risk is either oversimplified (by recommending avoidance of adverse weather altogether) or overly complicated (by suggesting calculations for resonant, synchronous, and parametric roll risks based largely on estimates). While assessing the influence of weather on a vessel’s motions may seem straightforward in theory, it is much more challenging for
seafarers in practice due to numerous unknowns and estimations.
Is there indeed a progressive deterioration of the lashing efficacy that leads to failure beyond a specific period?
The constant motion of a vessel in heavy seas can exert loads on container stacks, leading to the potential loosening of lashings. The loosening process can start early in heavy weather conditions, especially if the ship is navigating through rough seas for an extended period.
In theory, routine lashing checks may seem like an appropriate preventive measure, but in practice, this could pose safety concerns, as the crew would then be exposed to adverse weather during lashing checks. This risk would be even greater aboard larger vessels where there are a lot more lashings to be checked.
for vessels with deteriorated container sockets and lashing eyes?
Experience shows that the condition of lashing and securing equipment degrades over time due to usage and inadequate maintenance. It is no surprise that stack collapse incident investigations often emphasise poorly maintained lashing and
securing equipment as contributing factors. In fact, corroded sockets and lashing eyes rank among the top three findings in Gard’s condition survey data for container ships.
Despite these issues, containers continue to be loaded in affected slots, and repairs are postponed until dry dock for commercial reasons. Our recommendation is, of course, that affected slots be taken out of service until repairs are carried out, but from a pure routing perspective, weather thresholds might need to be adjusted for such vessels. We understand that a few liner operators already have such procedures in place for both owned and chartered tonnage.
To what extent can the securing of cargo inside containers endure movement caused by adverse weather?
Prolonged exposure of the vessel to rough weather could lead to deterioration of cargo securing within the container, potentially leading to cargo breaking loose and shifting within the container. This, in turn, adds additional forces to the container stack.
The ship’s crew lacks visibility and control over this aspect. The solution involves engaging in dialogue with and educating shippers, along with implementing improved Know Your Customer (KYC) procedures.
Should safe weather routing and avoidance of adverse weather be included as components of internal key performance indicators (KPIs)?
Modern digital tools make it much easier to assess a vessel’s or fleet’s exposure to weather over a specific time frame. This assessment not only helps a company determine if its vessels encountered weather conditions exceeding internally defined thresholds but also facilitates benchmarking against other vessels of similar size and on similar routes, whether under the same management/ownership or different.
Given that most liner operators already have dedicated teams focusing on vessel routing for efficiency and scheduling purposes, expanding their focus to include the aforementioned aspects could enhance safety.
Gard is owned by the industry it serves – working for and with its Members and clients whilst offering the widest choice of marine policies. Founded in 1907 in Arendal, Gard is today the largest P&I Club and one of the largest marine insurers in the world, employing more than 650 people in 13 global offices. We focus on providing the maritime industries with insurance products that offer financial protection and practical assistance when disaster strikes. Head to gard.no to learn more.
How wars, blockades, ship bombings, and sanctions are changing the insurance landscape
The Ukrainian war and attacks on ships transiting the Red Sea opened a new chapter for underwriters and exposed escalating risks brought by the shifting distribution of global power. In his annual Royal United Services Institute address in December 2023, the UK’s Chief of Defence Staff, Admiral Sir Tony Radakin, spoke of his concern at the “extraordinarily dangerous times” the world now finds itself in, “putting the international system under intense strain.” For war risk insurers, this is not entirely new ground. An estimated 258 distinct armed conflicts have taken place since 1946. So, underwriters must remain permanently on their guard as the threat from warlike acts is, regrettably, ubiquitous.
However, the international security environment looks set to deteriorate in the years ahead through a volatile mix of rising stateon-state competition, the proliferation of non-state armed groups, and civil unrest. If operating in high-risk areas, the shipping industry must be agile with its response.
Within its first year, comparisons were drawn between the war risk claims arising out of the Ukrainian conflict and the Tanker Wars of the 1980s. However, from both the assured and underwriting perspective, the risk environment has been quite different.
Despite the intensity of the Iran-Iraq War, global oil supplies were not significantly impacted due to attacks by one combatant on the others’ ships and installations. The high profits available from trading oil & gas justified the operational risk and the high cost of war risk premiums at the time.
The Reagan administration deployed the largest naval convoy system since WWII, re-flagged tankers under the American flag, and placed military assets on board commercial vessels in the Arabian Gulf. These measures had a slight downward effect on war risk premiums and kept a greater
volume of trade moving than might otherwise have been possible – albeit under a heightened kinetic threat. The pattern and type of claims arising, as a result, were different and drawn out over a longer period.
However, in Ukraine, the ‘drawbridge’ came up at relatively short notice, and those vessels unlucky enough to be caught behind Russia’s blockade resulted in a unique cluster of total loss/detention claims once the applicable 6- or 12-month policy period elapsed.
Given the risk of escalation and the threat from sea mines, the prospect of a NATO/ international convoy system in the Black Sea seems remote unless a political settlement to free up sea routes materialises. In the meantime, no merchant vessel wants to be perceived as a military target by Russia. Insurers have explored diversifying their transport routes and have turned to inland options via Ukraine’s river system. Alternatively, those taking advantage of the recent “Black Sea cover” hug the territorial coastlines of Turkey, Romania and Bulgaria to retrieve Ukraine’s vital grain exports. Advancements in vessel tracking technology have also buoyed underwriting confidence.
Although an insured’s loss of free use and deprivation for a continuous period under a war risk policy will always be fact-specific,
the Ukraine situation became more manageable once stakeholders realised Moscow’s posture wasn’t going to change – and it was likely the blockade would continue for some time. It has meant limited reason to dispute whether the threshold of “continuous period” has been met, even though the welfare of trapped seafarers has remained a constant concern for owners and liability insurers.
Strained insurance capacity
Blockades – which, in military parlance, are usually an operation by a belligerent state to prevent vessels and/or aircraft of all states (enemy and neutral) from entering or exiting specified ports, airfields, or areas under its control – are relatively rare and whether a constructive total loss arises from a blockade should be apparent – most people will know one when they see one.
However, the London Blocking and Trapping Addendum clause is more generous, as it will apply to blockages arising from a “warlike act” or “act of national defence,” and there is potential for claims aggregation issues under some policies, where a limit is qualified with words such as “any one occurrence.”
We are aware of disputes arising from the underlying contracts regarding charter
party or cargo loss disputes arising from some detained vessels. However, a calm and commercial approach has secured several settlements. The Ukraine situation, as well as the collapse of the grain corridor initiative, led to capacity in the war risk market decreasing dramatically, and an increasing number of underwriters understandably felt unable to provide cover for Russia and Ukraine calls.
Those who would sell cover faced plummeting demand. The re-insurance landscape also tightened, with exclusions passed down the line. Those 2022-23 trends are now showing signs of a gradual reversal.
The proliferation of attacks in the Red Sea and Gulf of Aden in response to the situation in Gaza presents underwriters with a very different risk variant. Here, it is the threat of bombing or ballistic attack, not blockade or detention, taking centre stage.
The availability of sea room and alternative routes/diversions (not physically possible in the Black Sea) should soften the underwriting impact of an otherwise alarming geopolitical situation. Time will tell whether international intervention by Western forces will mitigate the Houthi threat or merely deflect it onto increasingly nervous Gulf allies.
Reducing capacity for the Red Sea/ Gulf of Aden cover isn’t really an option.
However, premiums will increase, notification requirements to transit risk areas will be strictly adhered to, and quotations for cover may have a very short shelf-life (e.g. 24 hours). Unlike the Ukraine conflict, there has been no rush by the West to implement further sanctions against Iran and Yemen. Their effect to date has been negligible and is of little worry to international markets.
However, the sustainability of the international sanction regime against Russia is perhaps of greater concern. Sanctions have motivated so-called ‘dark fleet’ practices and provided opportunities for states that don’t subscribe to such measures to increase their trade with Russian interests. If the Ukraine war lasts another five or ten years, the effect of sanctions in re-orientating the global economy may be irreversible.
The return of war to Eastern Europe, strategic competition for influence in the IndoPacific, and now a deteriorating security
situation on the Arabian Peninsula paint a bleak forecast for the year. Over half the world’s population will also go to the polls, which will likely steer foreign policies in new and unpredictable directions.
The established international frameworks which promoted democratic government and free market capitalism after WWII are now under considerable strain, creating tensions through competition and conflicting approaches to policy.
Two permanent members of the UN Security Council – Russia and China –now exhibit expansionist ambitions, which deeply concern the US, UK, and France. The result is a global race to court strategically located powers – such as Saudi Arabia, South Africa, Turkey, India, and Indonesia – in a bid to ensure the Western orthodoxy can survive this century.
The future challenge for underwriters will be to effectively decipher this fastmoving, complex environment and identify potential flashpoints. Agility, adaptability, and keeping prices in range will win out.
between. Go to cjclaw.com to learn more.
Ship Carbon Intensity Indicator (CII) ratings will be released imminently for their performance in 2023. However, with the low take-up of Bimco’s CII Time Charter Clause and with many in the industry questioning whether CII is truly fit for purpose, let us examine whether low CII ratings will cause any impact and take a look at the Bimco CII Clause for Voyage Charter Parties published in October 2023.
It appears that much of the industry retains concern that CII does not do the job it set out to do, namely assisting with lowering emissions. As such, based on the current CII formula, shipowners and operators may question whether a vessel’s CII rating is genuinely reflective of its environmental impact over the course of last year and, therefore, pay little regard to it as a result.
Many of the potential issues with CII were recognised in advance (CII – Time for a Rethink?). With no fines in place for vessels achieving a low rating (“corrective action” needs to be taken initially for E-rated ships only), the potential impact of a low rating was to be determined to a large extent by market forces. For example, if higher-rated ships became more charterable and could achieve potentially higher rates (there was talk of a possible two-tier market developing with A-C rated ships being more in demand and achieving higher rates than those rated D or E), the knock-on effect could be felt by shipowners in the form of reduced hire or freight income for their lower-rated vessels which, over a year’s period in 2024, could be substantial.
In the absence of the Bimco CII Time Charter Clause, it appeared useful to explore whether a shipowner could claim such losses from its 2023 time charterer(s) under the implied indemnity. However, if the industry remains nonplussed by the CII mechanism, the prospects of a twotier market developing, initially at least,
would appear to be reduced as would, therefore, disputes arising out of low CII ratings. Nevertheless, it remains a possibility that disputes may arise between parties brought about by low ratings.
Published last April, CJC’s abovementioned article on CII also flagged up the fact that in order for a charterer to have the legal right to give orders to improve a vessel’s CII rating, parties would need to negotiate clauses into their voyage charters.
In particular, to give the bottom time charterer in a chain of contracts the right to be able to even order a vessel to, say, slow steam, a suitable clause would be required in the voyage charter to avoid that time charterer being in breach of its voyage charter obligations to proceed with utmost dispatch and all due dispatch.
That article flagged other issues, such as parties’ responsibility to ensure that similar rights in respect of vessel speed orders were incorporated into bills of lading.
The Bimco CII Clause for Voyage Charter Parties published in October 2023 achieves this, and it is, therefore, a less controversial clause than its Bimco CII Time Charter Clause cousin. Devised after soundings were taken from charterers and traders, BIMCO’s new Voyage Charter Parties CII Clause “focuses on course adjustment and speed reduction and includes commercial elements such as data sharing,” according to Stinne Taiger Ivø, Director, Contracts & Support at Bimco.
In order to not upset the “usual” contractual balance between the owners and the charterers under voyage charter parties, the clause entitles the owners/master to order the vessel to adjust course and/ or to reduce speed or RPM to lower the carbon intensity of the ship. However, the clause does not provide the owners with a “carte blanche” to operate their vessel at any (low) speed. The vessel’s speed can only be reduced within the prescribed limits indicated in subclause (a) as a minimum speed (basis good weather conditions). It is for the owners and the charterers to agree at the time of concluding the charter party what that minimum speed and the relevant good weather conditions should be.
The parties must insert into subclause (a) an agreed definition of “good weather” (which may already be reflected under provisions contained in the charter party). A “good weather” definition can vary between charter parties for a variety of reasons and should, therefore, be subject to specific agreement between the parties. An important aspect of this clause relates to the owners’ “despatch” obligations under the charter party and contracts of carriage. Subclauses (b) and (c) specifically address this issue. Subclause (b) clarifies that the exercise by the owners of their option to adjust course and/or to reduce speed will not amount to a breach of contract, including any speed and consumption warranties (if incorporated). However, as most voyage charter parties do not contain such
speed and consumption warranties, the parties may choose to delete this reference. Furthermore, subclause (b) clarifies that the laycan, as stated in the charter party, shall remain unaffected by this clause because it is important for charterers to be able to rely on the agreed laycan to plan the loading of the cargo and thereby enable them to enhance operational efficiency. Furthermore, the laycan and the minimum speed to be stipulated in this clause are agreed upon when the parties negotiate the charter party.
Under subclause (c), the charterers are obliged to indemnify the owners against claims for breach of contracts of carriage if any such contracts impose or result in the owners facing more onerous liabilities than those which they have assumed under the clause.
Subclause (d) is intended to avoid arguments over whether the vessel is permitted to proceed below the minimum speed agreed in subclause (a) in circumstances where there is an express or implied right to do so under the charter party. For example, the relevant authorities might require a vessel going in and out of ports or one following a convoy to proceed at a slower speed for a limited time. Emergencies may also necessitate a slower speed.
Finally, subclause (e) addresses the sharing of relevant data and information to the charterers in relation to the type and quantities of fuel used and distance travelled under the charter party. The rationale
underlying this subclause is that many charterers request access to such information in order to perform their own CII calculations. This information can also be relevant for charterers’ environmental reporting protocols, highlighting the connection between these metrics and sustainable operational practices. The parties are expected to agree to a specific time frame by inserting an agreed number of days into the clause. If no figure is inserted, the default shall be seven days.
Why should we focus on the right to slow steam instead of proceeding with all due dispatch? Measures to improve a CII rating include slower steaming to improve fuel efficiency, similar to the way in which the Energy Efficiency Existing Ship Index (EEXI) compliance with, say, overridable power limiters causes the ship to proceed more slowly. However, a key difference between EEXI and CII is that a vessel ought to comply with its speed restrictions enforced by an overridable power limiter, whereas charterers operating a ship can usually still opt to proceed
at a vessel’s maximum permitted speed should they choose to do so.
The clause cannot address all practical issues. A bottom-time charterer’s focus is likely to remain on maximising profits. A slower ship over a certain time could mean fewer voyages and reduced overall freight earnings. There is also little financial incentive to load less cargo and reduce freight earnings that way to improve fuel efficiency. In other words, financial restrictions on a time charterer providing a vessel with the orders that it may need to boost its CII rating remain in place.
Given the market feedback on CII, it would not be surprising if charterers’ primary motive remains profitability on each voyage as opposed to improvement of a vessel’s CII rating. As such, even if contractual rights to slow steam are incorporated into voyage charters and bills of lading, it remains to be seen if charterers take up such rights on a global and substantive scale.
Campbell Johnston Clark (CJC) is an international law firm founded in September 2010, specialising in shipping and international trade. CJC has undergone sizeable expansion in both the number of solicitors and geographical spread since its opening. Today, we have offices in London, Newcastle, Singapore and Miami. We have firmly established our presence in the London and overseas shipping markets with clients and fellow practitioners alike. We advise on all aspects of the shipping sector, from ship finance to dry shipping and comprehensive casualty handling – and all that happens in between. Go to cjclaw.com to learn more.
The prospects for hydrogen trade are developing rapidly but are still theoretical. Estimates prepared by bodies such as the International Energy Agency (IEA) and the Hydrogen Council (a body that seeks to promote the hydrogen economy) provide a wide range of potential outcomes. However, once the hydrogen economy moves past the theoretical stage, shipping demand will increase, and ammonia’s role will be transformed.
Major challenges remain before significant trade can become a reality. Perhaps the most important are policy uncertainty and final investment. Increased capital costs combined with unclear regulatory decisions surrounding government subsidies have led to low developer confidence and widespread project delays. Nevertheless, progress is being made, most notably with Saudi Arabia’s Public Investment Fund and ACWA, in partnership with Air Products, reaching the final investment decision (FID) in 2023 on the NEOM Helios Green Fuels Project ($8.5 billion investment of 3.9 gigawatts of capacity to produce 600 tonnes of green hydrogen per day).
National and regional energy plans are emerging. The EU has a stated aim to import 10 million tonnes per annum of hydrogen by 2030 for use as an alternative to natural gas and as a transportation fuel. Progress is being made towards meeting this target, as set out in the RePowerEU plan.
In March this year, Canada and Germany signed an agreement committing them to back transactions between Canadian hydrogen producers and German off-takers as a means of working towards commercial-scale trade of clean hydrogen fuel. As yet, details of the import mechanism are unclear, but it seems most probable that this will be in the form of
ammonia. Meanwhile, in the US, the Inflation Reduction Act aims to stimulate the development of low-carbon energy sources.
The decarbonisation of the global economy and its implications for shipping are increasingly fundamental to MSI’s long-term forecasts. As a result, we have developed a series of interlinked models looking at the evolution of hydrogen production, consumption, and trade. The models assess the potential for supply and demand in ten countries/ regions. Each country/region is also evaluated for potential for exports and imports.
Energy analysts categorise methods for hydrogen production according to the associated carbon emissions using a veritable rainbow of colours. However, for MSI’s purposes, we have simplified the analysis to cover green and blue (collectively clean). Blue represents production from coal or natural gas with carbon capture, while green is via water electrolysis using renewable electricity.
Indeed, the key to the production of green hydrogen lies in the development of renewable energy production, which globally increased by 54% in the decade to 2020 – and the pace of investment is set to accelerate. Significant development of renewables has been seen across the globe, most
notably in China, Europe, and North & Latin America. Under our Base Case, this is sufficient to meet projected requirements for the hydrogen economy and other key sectors.
MSI’s analysis extends to 2050, integrating our forecast for hydrogen demand with our Energy Model. Long-term forecasts are aligned to some extent with the IEA’s Announced Pledges Scenario and forecasts from BP and Shell.
The output of the initial phase of our modelling is a forecast for exports and imports of hydrogen for each country/region. A forecast for pipeline and seaborne trade is also provided, based on proposals for Europe and assumptions on pipeline supply to China.
The next issue to be addressed is what form the seaborne trade in hydrogen will take. At present, there is a widespread assumption that, in the first instance, ammonia and methanol will be the ‘hydrogen carriers’ produced from clean hydrogen. In the longer term, the liquid hydrogen trade is assumed to become viable.
Short-term forecasts are based on our database of hydrogen projects. MSI has identified more than 1,000 of these for clean hydrogen production that are either operational, under construction, have taken FID, or are at the feasibility study stage.
These generally include an indication of focus in several categories: domestic use/ export, transportation as hydrogen/methanol/ammonia, and/or use for bunkering.
The large number of operational projects tells a story in itself. The operational supply of clean hydrogen accounts for just under 2% of the total announced supply. These facilities are small-scale and proof of concept, with an average capacity of around 1,200 tonnes/year. For those projects under construction, the average capacity rises to about 18,000t/y. The need to scale up is clear in the fact that for projects that have taken FID or are at the front-end engineering and design stage, the average rises to almost 70,000t/y.
The overwhelming majority of projects under consideration at present are in Europe and North America, with most of the output to be consumed locally. In the major export centres of Latin America, the Middle East, and Oceania, there are over 170 projects with a potential capacity of almost 14mt of hydrogen by 2030.
MSI’s assessment of the current pipeline of projects suggests that the production of clean (blue/green) hydrogen could reach 18mt by 2030. To put this in context, it is worth mentioning a caveat that has been noted repeatedly by the World Hydrogen Council. They suggest that while growth in the number of projects is exponential, for projects taking FID, the graph is linear with a very low slope. The gap between proposed and actual needs to be bridged – and soon – if there is to be sufficient green hydrogen and derivative products available by this decade’s end and beyond.
Despite high costs and safety issues, clean ammonia’s role as a prospective marine bunker fuel, hydrogen carrier for use in power generation, and industry feedstock has solidified its place in the green transition, especially for high-volume uses. For example, plans for direct co-burning of ammonia in coal-powered electricity plants in Japan provide a clear opportunity for end-use without reconversion.
This signals a marked transformation for the industry, which has been focused on fertiliser production, to one driven by energy markets. Future volumes of clean ammonia are set to dwarf the existing grey trade. The nascent industry is anticipated to achieve clean exports of up to 30mt by 2030 and, in the best-case scenario, could reach 300mt by mid-century.
Production of clean methanol is also ramping up, driven by uptake agreements for methanol as a marine fuel, its use as a chemical feedstock, and its role in the hydrogen economy. Whilst sharing similar drivers, clean methanol trade is forecast to be significantly lower than that of ammonia, with 2030 seeing almost 15mt of product traded. By 2050, global clean methanol trade is expected to rise
to 95mt – equivalent to half of the amount of clean ammonia trade.
Despite our model showing a relatively slow start for green methanol trade, incremental growth is expected year-on-year from 2026. We expect exports of green methanol to be around 8.0mt, equivalent to 23% of the projected grey methanol trade by 2030.
The requirement for methanol-capable chemical tankers will continuously and gradually expand. We expect 25 methanol carriers (of 50,000 deadweight) will be required to transport 15mt of trade by 2030; our modelling suggests a total of 215 methanol carriers of 50,000 dwt could be required by 2050 to ship the expected 95mt of clean methanol trade.
Ammonia trade is likely to be transformed over the next 25 years. By the middle of the century, clean ammonia could provide demand for up to 400 very-large gas carriers (VLGC), compared to the current fleet of 375 that is focused on carrying liquefied petroleum gas. In this context, it is striking that the current order book for ammoniacapable VLGCs is reported to be more than 50 ships. In contrast, though a requirement for just under 200 methanol carriers will be significant, it compares to an aggregate methanol-capable 35,000+ dwt fleet of 277 at the end of 2023.
From market analysis and risk evaluation to investment decision support and advisory, Maritime Strategies International (MSI) offers independent market forecasting and business advisory services for shipping, offshore, maritime infrastructure and allied industries. For over 35 years, the company has been developing integrated relationships through deep-seated expertise. Visit msiltd.com to discover more.
The global shipping industry carries 80% to 90% of global trade, yet the industry has not yet begun to decarbonize in any meaningful way. While sea transport is relatively efficient compared to air or road transport, the shipping industry still emits roughly 1 billion tons of CO2e annually. Meanwhile, trade tonnage is set to grow as much as 130% by 2050, according to the International Maritime Organization (IMO). About 99% of the industry’s energy needs are still filled by fossil fuels, despite intense pressure from customers, policymakers, and society at large to accelerate decarbonization.
Efficiency improvements can help reduce the shipping sector’s greenhouse gas emissions. Yet it is widely acknowledged that the largest reduction must come from replacing fossil fuels with low-carbon alternatives such as e-fuels (made with captured biogenic CO 2 and clean hydrogen), biofuels, or battery-electric propulsion. Choosing the optimal low-carbon alternative for a given route depends on many factors beyond cost and emissions intensity, such as fuel availability, performance, safety, and supply security. The shipping industry’s future is expected
to include a tapestry of different fuels. Many low-carbon alternatives to current marine fuels exist (see “Power to Spare”). While e-ammonia and e-methanol have garnered most of the attention from shipping players seeking to decarbonize, we make the case for biogas-pathway fuels, which include biomethane (called renewable natural gas, or RNG, in North America) and biomethanol derived from biogas. These two fuels are the most mature and affordable low-carbon alternatives today and we believe they represent the best nearterm decarbonization options for many in the shipping industry. Under the right
conditions, biogas-pathway fuels have the potential to decarbonize up to 15% to 30%1 of global shipping by 2050.
If use of biogas-pathway fuels is to reach its potential, industry stakeholders must work together to overcome several hurdles. These include the availability of sustainable feedstocks, lack of production and transport infrastructure, competition with other sectors, and the potential for fugitive emissions from upstream and onboard leakage. Such challenges can be overcome and biogas-pathway fuels can play a meaningful role in the effort to decarbonize the marine shipping industry.
1 Assumes available feedstock of 40-80 EJ (lower end in line with availability from waste and residues). Assumes 2-4 EJ of biogas-pathway fuels as fair share for shipping, from global biogas supply of 25 EJ in 2050.
Power to spare. Several low-carbon marine fuels are currently under development in addition to biogas-pathway fuels. Each has advantages and drawbacks in terms of cost, sustainability, scalability, technical and market maturity, and safety.
Offering the potential for near zero-emission shipping with no feedstock constraints beyond the need for cheap renewable power, e-ammonia is the favored low-carbon fuel of many in the shipping industry. However, enabling the broad use of ammonia as bunker fuel will require major updates to health
and safety equipment and protocols on vessels and in ports to protect human and aquatic life. Currently two to four times more expensive than heavy fuel oil, its affordability depends on the broad availability of low-cost renewable power and green hydrogen.
Like e-ammonia, e-methanol can deliver near zero-emission shipping, but methanol is easier to handle than ammonia and is less toxic to humans and aquatic life. There are now over 100 methanol-ready vessels on order. The first vessel was recently delivered to shipping giant Maersk, which recently announced the formation of a new company to develop e-methanol projects
to supply green fuel for its fleet. However, e-methanol itself will be difficult to scale affordably due to the limited availability of the sustainable CO 2 needed to produce it. Like e-ammonia, e-methanol also depends on cheap renewable power and green hydrogen to reach the forecast 2030 cost of between $40 and $60 per GJ.
As a drop-in replacement for fossil LNG, liquefied e-methane can leverage existing LNG transport and storage infrastructure. CMA CGM is rapidly building vessels equipped with dual-fuel engines and plans to have 77 ships capable of using either bio- or e-methane by 2026 (and recently hedged
its bet with a large order book of 24 methanol-powered ships). However, due to dependence on scarce sustainable CO 2 and a more expensive production process, the fuel is forecast to be consistently more expensive than the other two favored e-fuels.
Blue ammonia is derived from blue hydrogen, made from a process using natural gas and capturing the resulting CO 2 , rather than through electrolysis powered by renewable energy. Although the carbon intensity of blue ammonia is higher than the green variety, it can still deliver meaningful reductions in
well-to-wake emissions compared to heavy fuel oil. And its affordability does not depend on rapid improvements in the cost of renewable power or electrolyzers. However, it is not clear whether regulators will allow long-term use of blue ammonia due to its inferior carbon intensities.
These fuels, which include biodiesel, bio-oils and biomethanol derived from biomass gasification, are generally more affordable than e-fuels today but face challenges regarding their sustainability credentials and available supply. Biodiesel is commercially available today but still releases between 20% and 40% of the emissions of equivalent fossil fuels; moreover,
supplies are likely to be constrained due to competition from other sectors. Bio-oils can be produced with a broad range of carbon intensities and is likely more affordable than biodiesel, but the production process is not yet mature and feedstocks also face supply limitations. Biomethanol from gasification is promising but faces similar technical and supply hurdles.
Partner and Associate Director, Downstream Oil & Gas, Boston Consulting Group
The shipping industry is increasingly turning to liquefied natural gas (LNG) as an alternative fuel to heavy fuel oil, primarily due to its low sulfur oxide emissions. This shift is in response to the stringent restrictions imposed by the International Maritime Organization (IMO) on sulfur emissions. Currently, about 6% of the global fleet can operate on LNG, but a significant shift is on the horizon. Orders for new ships reveal that 55% of vessels under construction are designed to utilize LNG as fuel. This is a significant increase from 2021 when 31% of the fleet on order was capable of using some form of alternative fuel, signaling a growing commitment
toward alternative fuels in the maritime industry. While the adoption of LNG helps address the emission of sulfur and other toxic substances, it does not eliminate CO2 emissions. Full decarbonization of the fleet running on LNG requires a shift to green sources of natural gas. This is where biogas emerges as a promising option. Combined with regulatory measures and discipline within the maritime sector, biogas offers a pathway to the real decarbonization of maritime transport. However, biogas is not the only potential source of LNG for the maritime industry. The sector is also exploring e-NG or e-LNG – electric natural gas produced
through the synthesis of green hydrogen from electrolysis and renewable sources of CO2 and carbon. This approach highlights the industry’s broader interest in innovative solutions to achieve sustainability.
Beyond LNG, the shipping industry is considering other alternative fuels, such as ‘clean’ ammonia and methanol. Each of these fuels has its own production pathway and requires different adaptations within the fleet. Nevertheless, both are undergoing significant development, underscoring the maritime sector’s commitment to exploring diverse and sustainable energy sources to meet future environmental challenges.
Biogas is a mixture of methane and CO2 that is produced via the anaerobic digestion of biomass. It can be further processed into biomethane or biomethanol, which we refer
The production process for these fuels is fully mature and useful quantities are already available. Between 0.3 and 0.4 exajoules (EJ)2 of biomethane are
Compared to other biofuels, a broad range of feedstocks can be used. Anaerobic digestion is a suitable waste treatment method for feedstocks as diverse as corn
Biogas-pathway fuels offer the potential for reductions greater than 100% in wellto-wake emissions compared with typical fuel oil. This is because in the production
Biogas-pathway fuels are far less toxic to humans and aquatic life than ammonia. Ammonia is toxic to aquatic life at concentrations of 0.07 mg/liter, making
to as biogas-pathway fuels. Liquified biomethane (LBM) can directly replace liquefied natural gas in suitable marine engines, while biomethanol is a liquid at room
currently produced and used for a variety of applications, and the supply could potentially grow to between 2 and 5 EJ by 2030. 3 These volumes are significantly
husks, sewage sludge, and everyday trash. It provides a larger pool of feedstock supply (up to 40 EJ from waste and residues alone) 5 than feedstocks for other
of biogas, GHG emissions that would have occurred from the natural decay of organic material are captured and diverted. Materials that naturally emit large amounts of methane
it 1,000 times more deadly than current heavy fuel oil, and raises major concerns about the environmental impact of spills. Methane is of similar toxicity as heavy
2 Consistent with Cedigaz Global Biomethane Market 2022 Assessment (7.4 bcm or 0.3 EJ in 2022).
temperature that can be used interchangeably with e-methanol. Biogas-pathway fuels offer several advantages as low-carbon alternatives for the shipping industry.
larger than other low-carbon fuel supplies and could help considerably in meeting the global shipping sector’s 13 EJ4 final energy demand.
biofuels such as biodiesel, which can only be produced from a narrow set of oils and fats (estimated at just 2 EJ).
during decay, such as animal manure, offer the largest reductions in GHG emissions when used for biogas – assuming the successful management of fugitive emissions.
fuel oil to fish, and methanol is much safer. To reach the same toxicity to fish as a spill of heavy fuel oil, it would require 200 times as much methanol.
3 Lower and upper range represent Stated Policies and Sustainable Development Scenarios, respectively, as cited in IEA “ Outlook for biogas and biomethane” (2020).
4 Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping Position Paper: Fuel Option Scenarios
5 The Sixth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC AR6) cites a range of bioenergy potential of 5-50 EJ from wastes and residues, while IRENA estimates a total potential from wastes and residues of approximately 45 EJ, in 2020. Excluding forestry residues, the energy potential relevant for anaerobic digestion is estimated at up to 40 EJ, excluding sustainable purpose-grown crops.
Finally, these two fuels are the most affordable low-carbon fuels. Liquefied biomethane costs between $17 and $31 per gigajoule (GJ) today 6 and biomethanol from anaerobic digestion can be produced for between $25 and $45 per GJ. By comparison, the production cost of e-ammonia is forecast to fall only to between $30 and $55 per GJ by 2030,
while e-methanol costs are forecast at between $40 and $60 per GJ in 2030. Furthermore, the long-term affordability of these two e-fuels is contingent on the broad adoption of low-carbon hydrogen over the next 20 to 30 years.
Many low-carbon fuels will likely play a role in the effort to decarbonize the shipping industry. The Mærsk Mc-Kinney Møller
6 Values represent average global production costs, not sales prices. No taxes or incentives are assumed.
Center for Zero Carbon Shipping estimates that the deep sea shipping sector in 2050 will use four different main fuel types (produced from multiple production pathways), and no matter which low-carbon fuel becomes dominant, the most commonly used fuel will account for no more than 54% of the total. By then, biogas-pathway fuels could account for 19% to 37% of the overall mix.7
7 Upper bound for biogas-pathway fuels (37%) assumes all biomethanol is produced via the biogas pathway, i.e., none is produced via biomass gasification.
If biogas-pathway fuels are to reach their full potential as low-carbon alternatives for
the shipping industry, shipping companies, policymakers and industry associations will
need to work together to overcome four obstacles to their broader adoption (see Exhibit 1).
Will there be enough biomass feedstock available? It depends. The most optimistic estimates of the energy potential of today’s global stock of sustainable biomass relevant to biofuels are approximately 50 EJ. 8 This includes only second-generation biomass (“waste and residues”) that does not compete with food, does not cause adverse changes in land use, and is practical to collect. It comes primarily from agricultural residue but also from other organic waste, not all of which (such as forestry residues) can be used for biogas production. The energy potential from waste and residues available specifically for anaerobic digestion is estimated at up to 40 EJ.
Today as little as 6% of relevant feedstock is being captured for biogas production. Only around 20%12 of biogas is upgraded to biomethane, resulting in a global biomethane supply of 0.3 to 0.4 EJ.13 Improving this will require a major global expansion of the means to collect
Only about 3 EJ9 of biomass is currently being captured and converted to biogas. After conversion losses, the total energy content of the biogas produced today is estimated at just 1.8 to 2 EJ.10 This is well short of the volume needed to address the energy needs of the shipping sector of around 13 EJ, particularly when considering the many other uses of biogas.
Several actions can be taken to boost the global supply of sustainable biomass. In the near term, developing markets such as Brazil offer tremendous potential to capture under-utilized feedstocks and encourage the sustainable treatment of organic waste.11 Due to the global nature
unutilized feedstock, produce biogas, upgrade it to biomethane or biomethanol, and transport the fuel to ports.
In Europe and North America, companies are already making use of the most easily accessible feedstocks. Getting more will require improvements and
of the shipping industry, shipping companies have unique access to such resources. Investing in upstream fuel production now could ensure an adequate supply of feedstock at stable prices in coming decades.
Technological innovation will also be needed to increase the energy potential of existing feedstocks, such as straw, and to optimize the energy yield from the anaerobic digestion process by customizing reactor conditions to the feedstock mix. Finally, there is additional longer-term potential from new technology-enabled feedstocks such as sustainable and ecologically safe purpose-grown crops, and even algae.
expansions to infrastructure and innovations to the feedstocks themselves (such as briquetting straw to enable more efficient transport). The industry must also support investments outside of Europe and North America, where there is often an additional unmet need for natural gas.
8 50 EJ is consistent with the upper end of the range of energy potential from wastes and residues (5-50 EJ) cited in the Sixth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC AR6).
9 Estimated from global biogas production based on production efficiency of 62-64%, as cited in Biomethane production via AD and biomass gasification, Li et al. (2017).
10 Consistent with World Bioenergy Association data (1.46 EJ in 2020) assuming similar 9% CAGR to 2023 as observed over past 20 years.
11 Sustainable potential assumes no deforestation or adverse indirect land use changes (ILUC).
12 A very small share (<1%) is converted to biomethanol today.
13 Cedigaz Global Biomethane Market 2023 Assessment cites a 2022 production volume of 7.4 bcm or 0.28 EJ, and observes a CAGR over past five years of 20%, resulting in an estimated 2023 value of 0.34 EJ.
LNG facilities and pipelines can also be used to transport biogas.
Modern biogas production facilities should build synergies with other emerging low-carbon infrastructure, specifically those where the waste stream of CO2 from biogas production can be used in the production of e-methanol and e-hydrocarbon fuels. These include solar, wind, green hydrogen, and e-fuel production facilities. This is particularly relevant where low-carbon fuel production is being subsidized, as it is in the US through the Inflation Reduction Act.
Governments and industry associations must work together to create fundamental policy mechanisms to transport biogas-pathway fuels to where they are most needed. To ensure that the final fuels have been sustainably produced and thus meet their GHG abatement goals, global systems for guaranteeing their origin and certifying their low-carbon status must be developed. Existing schemes are limited by country or regional boundaries and hampered by legitimate local requirements and complexities.
In addition to being a promising fuel for shipping, biomethane is a flexible fuel that can be used as a drop-in replacement for any existing use of natural gas. Like natural gas, most biomethane today is used to produce power and heat. Even in the most optimistic case, supplies of biomethane will fall well short of satisfying all existing demand for natural gas and new demand from transport applications, including shipping and heavyduty transport. To maximize its societal
Mass balancing lets biomethane producers sell their fuel into existing natural gas grids and allows fuel consumers to purchase this biomethane from the grid via a certificate, much like renewable energy certificates in the energy sector. It is essential if existing infrastructure is to be used to connect buyers and sellers. As mass balancing becomes available more broadly, industry associations can encourage shipping companies to take part through endorsement and education. Together, these policies enable ships sailing in international waters to buy certified low-carbon fuels at any port they visit.
As societies around the globe work to decarbonize, biomethane (either compressed, or liquefied to be delivered as bio-LNG) is also attracting interest for use in heavy-duty transport. However, low-carbon hydrogen is also an attractive fuel for this sector. In addition, as batteries improve, electrification is becoming a feasible solution for a broader set of on-road vehicles, which could potentially include heavy-road trucking in years ahead.
Biomethane is particularly good for shipping because of its energy-dense
benefits, biomethane should flow towards applications that offer a strong fit and few promising decarbonization alternatives.
Heating, for example, accounts for a massive 50% of global final energy consumption, according to the International Energy Agency (IEA). Natural gas is the most common heating fuel, meeting 42% of demand in 2021. Most of the demand for heat, however, is addressable today with electric heat pumps, which can generate
Methane is a potent greenhouse gas. Its warming impact is 30 times greater than CO2 over a 100-year period, and 85 times greater over a 20-year period. Due to its potency, even small methane leaks must be avoided. The beneficial GHG impact of biogas-pathway fuels could be seriously eroded by methane leaks during their
Maritime industry stakeholders should immediately pursue five key actions to accelerate the adoption of biogas-pathway fuels in the shipping industry:
First: stimulate biogas production development, especially in regions with
production, transport, or use on board ships. Concrete actions can be taken to mitigate the risks of methane leaks. When preparing regulations, policymakers could consider the full lifecycle emissions of biomethane and biomethanol, including their 20-year global warming potential, and require measurement and tracking of methane leaks
large amounts of untapped feedstock.
Second: vertically integrate biogas production development to ensure volume security and price stability.
Third: use globally-recognized certificates or guarantees of origin to enable
portability, affordability, maturity compared to other low-carbon fuel options, and compatibility with existing LNG infrastructure. Yet very little biomethane or biomethanol is used in the shipping sector today. Raising awareness of the benefits of these fuels for shipping is a necessary first step towards increasing their adoption. Policymakers could ensure that biogaspathway fuels receive the same support as other low-carbon fuels, subject to sustainability requirements and the treatment of shipping as a favorable end use for these fuels. This may require updating existing legislation such as REPowerEU, which does not include transport applications in its 2030 target for EU biomethane demand.
The shipping industry can generate further momentum for the adoption of biogaspathway fuels by integrating upstream and producing the fuel themselves. An integrated supply chain would eliminate the need to compete with other sectors for biogas. It would also reduce the complexity of developing and marketing green shipping products, which in turn could generate additional revenue to fund the development of fuel supply chains.
heat three times more efficiently than gas-based assets. Some demand for heat cannot be electrified today, such as hightemperature heat for industrial processes. However, this can also be met using lowcarbon hydrogen or, in the near future, with emerging electrified solutions such as electric furnaces. Hastening the adoption of these alternative decarbonization technologies will make more biomethane available to the shipping industry.
along the entire value chain. Shipping players should implement methane tracking and visualization tools to find and plug leaks onshore and on board their ships. Finally, engine technologies that reduce methane slip – methane that escapes unburned from engines – such as hybridization and exhaust gas recirculation, should be developed.
development and marketing of biogasbased green shipping products.
Fourth: educate the shipping industry and ensure that policy can enable the fundamental merits of biogas.
Fifth: invest in innovation and use
regulation to speed adoption of technologies to limit onboard methane leaks and slip.
Despite little progress until recently, the shipping industry is finally building momentum towards decarbonization. With the IMO’s recent agreement to achieve net-zero emissions by or around 2050, and the publication of the final FuelEU Maritime legislation, the legislative framework supporting
decarbonization has never been stronger. Increased investment in low-carbon fuels and supporting infrastructure is sure to follow, with renewed debate regarding the merits of each low-carbon option.
Promoting biogas for investment and development will accelerate progress towards the full decarbonization of the
sector. And it need not slow investment and development in other green fuels, all essential to the future of the shipping industry. Moving towards net zero must be a collective pursuit.
Like all fuel pathways, there are challenges to be overcome for biogas-pathway fuels to realize their full potential
Boston Consulting Group is a global consulting firm that partners with leaders in business and society to tackle their most important challenges and capture their greatest opportunities. Our success depends on a spirit of deep collaboration and a global community of diverse individuals determined to make the world and each other better every day. Go to bcg.com to discover more. The authors would like to thank Roberta Cenni, Head of Biofuels at the Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping, and Mike Tupy, Principal Engineer at Cargill, for their contributions to this article.
What is commonly referred to as the energy transition actually consists of dozens of discrete transitions that span industries such as power generation, transportation, and agriculture. These various pathways to net zero are often tightly connected, with overlapping value chains, technology innovations, adoption rates, and feedback effects.
Given this complexity, using first-order analysis or toy models to shape corporate strategy, policy, or investments will lead to dangerous blind spots and poor decision making. Leaders won’t know how to stack or sequence critical initiatives, nor will they be able to identify hidden risks and opportunities.
Instead, leaders must adopt a holistic, integrated systems lens. A systems approach can inform action by creating deeper insights and realistic scenarios, including the following.
A view that goes beyond the silos of any one industry, technology, value chain, or
geography and considers the many stakeholders and factors at play.
The ability to understand and assess the intricate interconnections of supply chains, materials, production capacities, labor, capital, and regulation, among other factors – which in turn allows us to identify potential synergies, avoid unintended consequences, and gain perspective on where technological innovations and substitutions are likely or essential.
Guidance on predicting how energy and industrial systems may change over time due to their cascading impacts – and an understanding of the conditions under
which certain transition pathways are economically feasible and can deliver a more sustainable, adaptable, and resilient future.
BCG’s proprietary Systems Workbench for Insight on Transition Change-Green Transformation (SWITCH-GT) enables such an approach by allowing us to examine the dynamics of various energy transition pathways across sectors. (See the sidebar “Modeling the Complexity and Dynamics of the Energy Transition.”) To illustrate the value of this high-fidelity computational workbench, we’ve used it to explore how companies in one sector – wind turbine OEMs – can apply a systems lens to their business.
This latest research from the BCG Henderson Institute is aimed at widening the aperture and increasing the resolution on the complexity and dynamics of transitioning our industries and society to a nature-positive reality.
BCG is developing its Systems Workbench for Insight on Transition Change-Green Transformation (SWITCH-GT) to help stakeholders across the public and private sectors understand the industrial requirements for the ongoing energy and sustainability transition. Stakeholders need that insight if they are to successfully accelerate the development of clean energy, sustainable transportation, and other technologies required to achieve global net zero.
The workbench includes a high-resolution network model of the materials and technology supply chains and their
interconnected dynamics that draws on other BCG proprietary models – for a sense of magnitude, BCG has a dozen proprietary models for renewable hydrogen alone – along with more than 400 external data sources, including the International Energy Agency, US Energy Information Administration, International Renewable Energy Agency, US National Laboratories, academic papers, analyst reports, industry reports, and expert interviews. Currently, the model covers 134 subtechnologies within power, buildings, and transportation and roughly 300 materials.
In addition, more than 125 experts across BCG contributed to the development of this systems workbench. Their inputs were instrumental to the development of SWITCH-GT.
Although our wind OEM example focuses on a small slice of the overall energy transition, it underscores the vital importance of the systems approach. As corporate leaders, policymakers, and investors reshape companies, industries, and economies to avoid the worst effects of climate change, this systems lens offers them the broadest possible view of energy transition dynamics – which in turn will help them make better decisions for businesses and for the planet.
Many companies begin their decarbonization journey by looking within the immediate boundaries of their own business – their operations, product development, supply chain, and sometimes their industry’s ecosystem. This industry-specific view misses the potential interconnections and dynamics across sectors that may impact a company’s plans and returns over time.
To demonstrate the risk of this limited perspective, we compared a sector-based view of demand for 18 materials used in wind turbine manufacturing to a broader cross-industry view (see Exhibit 1). Our comparison uses a base scenario roughly
aligned with a 2°C warming projection under the IEA’s 2022 Announced Pledges Scenario (APS) and assumes the requisite deployment of various technologies to meet that target.
Looking only at demand from the wind industry, it is unclear which, if any, of the materials face supply constraints in this decade. Taking a cross-industry view –integrating demand from industries such as solar, storage, auto, buildings, and aviation – completes the picture.
At least 13 key materials used in wind turbine manufacturing – including carbon fiber, copper, cobalt, neodymium, dysprosium, praseodymium, and terbium – face scarcity by 2030 under the cross-industry analysis. While potential shortages of some of these materials (particularly the rare earth elements) are well recognized and have been identified as a potential obstacle to the pace of the energy transition, possible supply dynamics for other materials are less well known.
The real-world implications of scarcities are significant , whether in driving up raw material prices, contributing to project delays, or even forcing operational or technical redesigns. In the wind industry, for example, scarcity
drives higher project delivery costs; in the worst cases, it causes developers to park their projects at a time when the world desperately needs more capacity.
These constraints can be further shaped by several factors. Geopolitical developments, for example, can exacerbate shortages, with countries scrambling to secure supplies in a global economy where control of mining and processing is increasingly concentrated. Moreover, the demand for materials will change depending on how the numerous discrete transitions that are underway track above or below the APS trend in our base case. A different deployment trajectory for major transition technologies, such as EVs, wind power, solar power, and building efficiency improvements, would substantially shape the scarcity of various materials.
For the wind industry in our case study, the potential shortage in carbon fiber shown in Exhibit 1 is not widely recognized, and thus worthy of deeper investigation.
Carbon-fiber-reinforced polymer is replacing glass-fiber-reinforced polymer (fiberglass) as the dominant composite material used in the spar cap, which spans the length of
a turbine blade and serves as a structural support. While carbon fiber is more expensive than glass fiber for wind applications, at more than ten times the cost, using a higher share of carbon-fiber-reinforced polymer in the spar cap creates lighter and stronger blades. As a result, wind OEMs can build longer blades capable of producing energy
more efficiently – a particularly important factor in the offshore wind sector. The upshot: a potential shortage of carbon fiber could delay technology-based efficiency improvements in the wind industry.
Under our base case, demand for carbon fiber is expected to grow at a compound annual rate of about 20% through 2030 (see
The base case uses demand projections for wind energy aligned to IEA’s Announced Pledges Scenario, published in 2022, which calls for 2,251 gigawatts of installed capacity by 2030.
We assume that the share of total wind power generated by offshore wind turbines will increase from 7% in 2022 to 20% in 2030. Our model further assumes that wind turbine power capacity and blade length increase over time and that the blade design (including the use of fiberglass versus carbon fiber) is related to wind turbine size. The size distribution of onshore and offshore wind turbines, as well as the share of fiberglass versus carbon fiber blades, roughly aligns with Brinckmann’s Global Wind Technology Forecast from February of 2023.
The material composition of each wind turbine blade aligns with either reference blade SNL 100-00 (fiberglass) developed by Sandia National Laboratory or a modified IEA 15 MW turbine blade (carbon fiber) from the Offshore Renewable Energy Catapult (the modified IEA reference blade is referred to as “carbon fiber”
the sidebar “Assumptions in Our Base Case”). This will create a sizeable gap between supply and demand, even considering production expansions underway or planned to date. In fact, meeting the projected carbon fiber demand in our base case would require building out new capacity at roughly three times the historical rate (see Exhibit 2).
due to the use of that material in the spar cap, but it also includes fiberglass in its design). The material mass was scaled using a relationship between blade length and weight; the scaling factor was 2.2, per Lawrence Berkeley National Laboratory
We assume wind turbine blades use fiberglass blades in 100% of 50-meter blades, 80% of 70-meter blades, 22% of 90-meter blades, and 5% of 110-meter blades; we assume 100% of blades longer than 130 meters use carbon fiber designs.
This analysis assumes waste in wind ranges from 5% to 15% depending on the turbine blade component and material (fiberglass versus carbon fiber) and applies a 15% waste factor to carbon fiber in aviation, automotive, and other sectors. It also assumes that procurement of materials occurs in the same year as the installation of new wind capacity.
Supply figures are based on aggregation of available supply projections and, where available, include production expansions underway or announced to date.
If we look at even more bullish demand scenarios within the wind sector and for other technologies like EVs, the predicted supply-demand gap is wider still. For example, based on the IEA’s projections for wind and EV demand aligned with a 2050 net zero scenario, total carbon fiber demand increases at a 28% compound annual growth rate through 2030.
Already, soaring demand has contributed to a 15% jump in carbon fiber prices since 2019. And critically, expanding carbon fiber production is laden with challenges beyond the capital requirements and time lags common to industrial project planning. For example, obtaining permits takes longer and navigating workplace safety regulations is harder due to the toxicity of certain precursor materials for carbon fiber, ultimately causing delays that deter expansion. It can take two or more years to build a new carbon fiber production facility.
Moreover, 77% of carbon fiber production occurs in the Asia-Pacific Economic Cooperation region; this geographic concentration of production further complicates supply dynamics, as it exposes supply chains to potential geopolitical disruptions.
Looking at the forecast above, wind OEMs will likely ask the following questions. First, is a pathway that relies heavily on carbon fiber in wind turbine manufacturing really feasible? If so, under which scenarios would carbon fiber supply meet demand? Which factors do we need to consider to better inform our decision making? For example, how do we weigh the tradeoffs in design choices that will impact carbon fiber demand? And for which industries can carbon fiber easily be replaced with an alternative?
In the face of potential carbon fiber shortages, wind OEMs will likely search for ways to limit future supply chain disruptions. This may include changing blade composition or delaying the deployment of larger turbines. If these choices are adopted industry-wide, that will alter both the demand for carbon fiber across the wind industry and the timing of that demand (see Exhibit 3).
Beyond wind OEMs, automakers and aviation OEMs will also make engineering and sourcing decisions that will shape carbon fiber demand. Similarly, the extent to which carbon fiber manufacturers expand production in the face of this bullish forecast will further shape the risk of scarcity. The wind turbine manufacturer
in our case study must consider different scenarios for carbon fiber demand, including those from other industries, as well as scenarios for the possible expansion of carbon fiber supply, and then map out how these changes would affect the underlying economics of their business. That will help them select the best strategy to assure profitable growth.
If a wind turbine manufacturer concludes that using carbon fiber is too risky without further action, then it may aggressively commit to pursuing long-term production contracts, strategic coinvestments, or even acquisition and further corporate development. Alternatively, the company may shift its material mix toward fiberglass over carbon fiber where feasible. In fact, some manufacturers still use fiberglass designs for turbine blades greater than 100 meters in length.
Examining cascading effects
So, what are the implications of a decision by the wind turbine OEM in our example to rely more on fiberglass for its blades? To answer this question, a good starting point is to create a systems diagram (see Exhibit 4).
Even this simplified version illustrates the interconnections between demand for
carbon fiber, glass fiber, and other technologies and materials in the energy transition. We also include boron here as an example of the roughly dozen materials added to glass fiber to tailor its material properties. Each bubble in the diagram has its own dynamics that can be modeled.
This systems map helps identify relationships the wind turbine OEM in our example should explore, including what actions could potentially prevent a supply crunch in carbon fiber and the ramifications these actions would have for closely connected materials like fiberglass and boron.
To bring these dynamics to life, we crafted two scenarios to examine what interventions in the wind industry could bring the carbon fiber market to a more stable supply-demand equilibrium. Starting from our base-case projections, we gradually increased the share of small and medium turbines using fiberglass spar caps in Scenario 1. In Scenario 2, we applied the same conditions as in Scenario
1 and layered in a slower deployment of carbon-fiber-intensive larger turbines.
In Exhibit 5, we show how each scenario plays out for carbon fiber, glass fiber, and boron. The blue line shows the base-case supply for each material, with the shaded area indicating a reasonable range on the high and low side.
If demand shifts away from carbon fiber, the knock-on effects for fiberglass producers will be immediately apparent. What was a nearly balanced market for glass fiber shown in Exhibit 1 is now supply-constrained.
The mismatch between glass fiber supply and demand reveals a weakness in the way companies often assess supply constraints. Industry supply forecasts typically rely on projecting past trends into the future using industry rules of thumb, often built over years of predictable growth. That means that companies may miss a large structural change in demand, in this case driven by the confluence of multiple green transitions
– which can create risk for those companies looking to secure scarce materials and opportunity for those that can step in to meet demand.
Let’s assume that glass fiber producers are able to rapidly expand capacity by securing permits, engineering and building facilities with furnaces and refractories, and obtaining the license to operate within two years. After all, history has demonstrated a fairly resilient fiberglass market given its geographically dispersed production and its varied end applications. Even in this case, reverting to more glass fiber creates different cascading effects and another challenge emerges: a surge in demand for boron, an already scarce material that is an additive in the production of the most common formulation of glass fiber.
Boron is required for the manufacture of more than 300 products. This includes well-established industrial uses in products such as detergents, fertilizers, and insulation as well as newer clean energy uses,
such as neodymium magnets for directdrive wind turbines and select EV motors, boron steel, solar applications, and neutron absorbers in nuclear power plants.
Already, prices for boron have doubled since 2020. Our projections in Exhibit 1 suggest boron demand could exceed supply by roughly 20% by 2030 – and that doesn’t account for the potential volatility of supply and demand in the meantime. On the supply side, boron mining and processing are geographically concentrated, and the world’s largest known deposits are already being mined today. Opening a new boron mine has historically taken upwards of 20 years. Increased reliance on glass fiber could therefore increase a producer’s exposure to potential price spikes and supply bottlenecks for boron.
Certainly, innovation could help mitigate the impact of boron scarcity. For example, we may see substitution, with intermediate glass fiber producers
swapping out boron for another material – or two, or three – depending on how well the other material(s) can mimic boron’s chemical contribution to the product. These new glass fiber formulations could ripple through the market, with implications for production utilization, time lags, and prices. This in turn would cause a different cascade beyond wind, extending to other value-added fiberglass applications like automotive and aviation.
Integrating systems thinking into green transition strategy
This exercise examines the uncertainty, complexity, and cascading effects surrounding just a few factors affecting raw materials for a wind OEM. A holistic, integrated systems lens would not only consider the full range of material inputs but also assess other factors such as: the labor required to manufacture and assemble the
wind turbines; costs and externalities of expanding mining, refining, and manufacturing; infrastructure and logistics limitations for scaling bigger turbines; policies and regulation impacts; trade flows and geopolitical vulnerabilities; and adoption and integration rates into the grid.
The transition to net zero is the challenge of our time. We are struggling to push decarbonization quickly enough to avoid the most dire impacts of climate change; a primary reason is the sheer scale of the undertaking and the fact that we cannot decarbonize everything everywhere simultaneously.
The good news is that we now have the tools – including extensive data, advanced analytics, AI, and systems-dynamics and agent-based models – to meet that complexity head-on. Through platforms such as SWITCH-GT, business and government leaders can leverage these tools to shape a systems approach to the energy transition. There is no time to waste.
Boston Consulting Group is a global consulting firm that partners with leaders in business and society to tackle their most important challenges and capture their greatest opportunities. Our success depends on a spirit of deep collaboration and a global community of diverse individuals determined to make the world and each other better every day. Go to bcg.com to discover more. The authors would like to acknowledge Marek Davis, Joshua Chakravarty, and Sandra Starkey for their outsized contributions to the development of SWITCH-GT. Additionally, we would like to thank Jens Gjerrild and Lars Holm for their contributions as experts on wind energy.
As important of a role as international shipping plays economically, it is also responsible for significant environmental damage, ranking as the sixth largest greenhouse gas (GHG) emitter worldwide. To speed up its decarbonisation efforts, the International Maritime Organisation (IMO) GHG Strategy set a ‘2030 Breakthrough’ target of having scalable zero-emission fuels (SZEF) make up 5% of international shipping fuels by that date. The newest Climate Action in Shipping – Progress Towards Shipping’s 2030 Breakthrough report, authored by UMAS & UN Climate Change High-Level Champions and published annually, analysed SZEF adoption progress in 2023 compared to the year before. The findings show that there has been progress in areas such as IMO regulation, commitments from shipowners and governments (like national hydrogen initiatives), and the emergence of co-ops (e.g., the Zero Emission Maritime Buyers Alliance). However, full progress remains just partially on track due to challenges and uncertainty in fuel demand and technological and policy developments, among others.
The climate targets set up by various global regulatory bodies can only be achieved if sectors such as shipping accelerate their sustainability strategies and decarbonise. In 2023, progress towards achieving 5% SZEF by 2030 in maritime was noted. That said, the report suggests increasing the target to 10%, consistent with the new milestone from the 2023 IMO GHG Strategy (“5%, striving for 10% zero and near-zero GHG emission fuel use by 2030”), as it could stimulate more stakeholder action. Currently, the fleet capable of using SZEF only represents 1% of the 2030 goal.
While positive change is visible in the sector, there is still a need to ensure broader geographic representation in policy discussions and to address growing demand
concerns. To illustrate its 2023 findings, the report names five levers of change – technology and supply, demand, finance, policy, and civil society – where progress is necessary for reaching the 2030 5% SZEF goal. The actions pertaining to each lever are qualified as either on, partially on, or not on track.
The report found that the maritime sector has seen significant technological advancements as it transitions to clean fuels, with a notable increase in zero-emission vessel projects: 373 in 2023 vs around 200 in the preceding year.
Equally encouraging is the prominent trend of collaboration across different industry segments, with numerous
initiatives involving multiple value-chain segments. Projects related to fuel production, bunkering, and infrastructure are on the rise (mainly focusing on hydrogenbased technologies).
Furthermore, the industry has seen evident progress in ammonia and methanol internal combustion engines, already welcoming the first methanol-powered vessels. An ammonia engine should debut this year. However, concerns arise regarding the ability to manufacture these engines at a pace that meets the 5% target by 2030; for that to happen, “modelling suggests the equivalent of 600 container ships of 15,000-TEU capacity will be required,” warns the report.
Additionally, cost reduction in green hydrogen production, forecasted to drop below $2 per kilogram by 2026, is crucial
• 3/7 actions “on track”
• 3/7 actions “partially on track”
• 1/7 actions “not on track”
• 2/8 actions “on track” 1/8 actions “partially on track”
• 5/8 actions “not on track”
• All actions “partially on track”
• 3/10 actions “on track”
• 5/10 actions “partially on track”
2/10 actions “not on track”
2/5 actions “on track”
• 3/5 actions “partially on track”
• 60 GW green hydrogen electrolyser capacity
• Green hydrogen production cost of US$1.5-2/kg depending on the region
• 0.6 EJ of SZEF supply available by 2030 and 0.1 EJ by 2025 (indicative)
• 600 15k TEU containerships equivalent of SZEF demand15
8.75-12.5% of all TEU-miles to be SZEF by 2030 if other segments also scale out proportionally to SZEF16 All new ships to be SZEF-capable
• Majority of existing SZEF-ready tonnage to be converted to full SZEF-capability
• Alignment of shipping portfolios for as much of the US$ 500 bn+ of shipping debt to be as close to Poseidon Principles trajectories as possible — with those trajectories expected to match requirements for 1.5°C — but no higher than 10% and the majority to be under 5%
• 2/3 or more of all shipping debt to be tied to Poseidon Principles trajectories, increasing coverage from APAC and Greek lenders, and continued transparency from Western lenders
Continued or increased issuances of sustainabilitylinked loans and bonds to, and interest from, shipowners and related segments including ports and fuel suppliers
• Stricter requirements for eligibility for sustainability-linked loans and bonds and the focus to shift primarily to SZEF-related assets
• Adoption of ambitious shipping economic instruments with regulatory support for 5% SZEF adoption
• Top 20 countries by maritime traffic have ambitious domestic decarbonisation policies with increased hydrogen production commitments
International agreements on zero GHG shipping routes
Growing SIDS/LDC participation in IMO policy negotiations and or national action plans
Increased NGO pressure
• Workforce upskilling/retraining programmes in place
strategies have been published. “The current pipeline of project announcements in the IEA’s [International Energy Agency] hydrogen database represents up to 24 million tonnes of green hydrogen capacity by 2030,” says the report, before adding that just approximately 9.6% of the pipeline is either up & running or being constructed. Overall, reaching the requirements for scale and proportion by 2030 is “uncertain,” and, therefore, electrolyser and green hydrogen capacity is just partially on track.
Additionally, green ammonia and e-methanol production announcements amount to around 192mt (4.3 exajoules) and 6.0mt (0.1EJ), respectively. Then again, only a fraction of this capacity is currently operational or under construction, and quite a few more projects will be needed to reach the 2030 goal of 5%, especially considering the potential competition for clean fuels from other sectors. Further, uncertainties remain regarding how much of this announced capacity will actually materialise and align with the requirements. Future scenarios for capacity depend on various factors, including growth rates and allocation for maritime use. Despite these uncertainties, overall production is partially on track.
Domestic shipping also has the potential to significantly contribute to the SZEF target. Its decarbonisation efforts serve as research, development & demonstration cases for tech advancements that benefit both local and international shipping without competing for the same fuels. Developed nations could achieve a 15% reduction domestically and a 2-3% reduction of total shipping energy via a 30% transition to zero-emission sources. This underscores how short-sea technologies like battery-electric and fuel-cell propulsion systems could indirectly aid in reaching the 5% target. It is important to note that while battery-electric propulsion is technologically advanced, fuel-cell propulsion lags. Despite progress, scaling up the adoption of these technologies is necessary to meet the emission reduction goal by 2030. Overall, the technology and supply lever progress has been evaluated as partially on track.
The report also highlights that the demand for SZEF needs to increase significantly by 2025 and 2030 to meet the sector’s emission goals. Here, various stakeholders play a crucial role in achieving the 5% target by driving the speed of production and supply of clean fuels.
for scaling up supply. Yet even at a favourable production price of $1.5/kg, significant cost differences with fossil fuels persist for maritime use, and the report points out
Progress on SZEF demand is tracked through several indicators, including commitments to net-zero targets, actions promoting zero-emission freight traffic, and the growth of SZEF-capable fleets. Tab.
that “policy support mechanisms” will be essential to overcome the cost difference. Over 30 countries have released their hydrogen roadmaps, and 13 national hydrogen
Key industry actors commit to net zero by 2050 based on SBTi requirements and actions
Zero-emissions freight becomes increasingly commonplace
Owners, freight purchasers, fuel producers, ports, finance, and other stakeholders take part in pilots and demonstrations to unlock SZEF potential
“Dark green” corridors for zero-emission shipping start to materialise
ON TRACK 5-10 shipowners and operators committed
1-5 ports or yards committed
NOT ON TRACK Commitments from freight purchasers to secure zeroemissions tonnage for at least 1% of all TEU-miles
ON TRACK Over 150 projects on fuel production, and similar number on bunkering and infrastructure
PARTIALLY ON TRACK
Growth in the share of SZEFcapable vessels in the active fleet
NOT ON TRACK
Growth in the SZEF-ready vessels in the active fleet
Share of orderbook with SZEF-capable vessels
Share of orderbook with SZEF-ready vessels
NOT ON TRACK
NOT ON TRACK
NOT ON TRACK
While some indicators are on track or partially on track, such as commitments to actions as defined by the Science Based Targets initiative, others, like green corridors, are still a bit ambiguous; progress on the latter as a driver for demand is just partially on track. As such, despite some positive trends, uncertainties remain regarding SZEF adoption, especially considering that the current demand trajectory falls short of
20-30 shipowners or operators, as well as 10-20 ports or yards, committed to both near and 2050 targets and have actions set per SBTi requirements
5-10% of TEUmiles to be SZEF if transition led by containerships. If other segments also scale up, then about 1.5-3% of TEU-miles need to be SZEF
200+ fuel production and bunkering and infrastructure projects ongoing, at least 20 going beyond pilot stage into development
3-6 “dark green” corridors on major deep-sea routes functioning with multiple vessels on each using SZEF on a regular basis
3-4 routes have a roadmap in place, 2-3 routes further routes are being considered for development
100 15,000 TEU containerships running on e-methanol,31 or 20-30 15,000 TEU ships, if other segments in line32
SZEF-ready ships in the fleet to become SZEF-capable at their first dry dock on or before 2025
All new orders to be SZEF-capable or SZEF only
All new orders to be SZEF-capable or SZEF only
30+ ship owners join “Race to Zero”
30+ have SBTi commitment, at least half of whom are already taking stated actions
8.75–12.5% of all TEUmiles to be SZEF, if other segments also take up SZEF
Slowdown in piloting and significant increase in capital deployment to build out fuel production and bunkering systems
2022. However, LNG-powering and -capability are not SZEF compliant. At the same time, methanol-capable tonnage has grown from 0.01% to 0.06% – a substantial year-onyear growth, albeit to a tiny percentage of the fleet. Similarly, vessels liquefied petroleum gas- or ethane-capable have increased from 0.02% to 0.27% of total gross tonnage. Ammonia-capable ships are expected to enter the market not until late 2024.
Tighter regulations from the IMO and local authorities could increase demand for low-emission fuels beyond current projections. There must be a shift towards lowemission fuel-capable vessels, conversion of existing ships, and scrappage of older, high-emission tonnage to meet targets. While these changes are not yet fully evident, they are expected to progress in the coming years. As for now, the demand lever progress checks in at not on track.
30+ deep sea “dark green” corridors in operation, contributing substantially to the 0.6 EJ SZEF fuel target
600 15k TEU equivalent ships running on e-methanol or ammonia, or about 150 ships, if other segments take up SZEF at a similar pace
18-36 Mt/year of SZEF to be demanded by the alternative fuel capable fleet
All SZEF-ready vessels ordered before 2030 to have been converted to SZEF capability
All new orders to be SZEF-capable or SZEF only
All new orders to be SZEF-capable or SZEF only
even the 2025 targets. Various segments of the industry need to contribute significantly to meet SZEF demand goals (not least shipping’s clients through, e.g., energy insetting), although actual uptake is uncertain due to the potential of continued use of fossil fuels.
The growth in the number of alternative fuel ships has been primarily driven by liquefied natural gas (LNG), which has more than doubled its capacity between 2015 and
Financing is another critical lever for reaching clean fuel targets because of its ability to promote the use of SZEF as well as discourage the use of polluting fuels and vessels. Four indicators have been used to track the changes that the finance sector has had on the SZEF transition, covering issues such as the alignment of shipping debt with 2030 and 2050 targets (e.g., via the Poseidon Principles), transparency in debt alignment, sustainability-linked loans and bonds, and public finance availability. For years now, a significant portion of shipping debt has been linked to the Poseidon Principles, with a slight improvement in alignment scores. However, these Poseidon trajectories fall short of the 5% SZEF by 2030 goal; that is why “updating the Poseidon Principles to be in line with a 1.5°C pathway should be considered a priority,” advise the report’s authors. Debt transparency and alignment have improved, but the growth in debt coverage might slow down, especially if Asia Pacific and Greek lenders, who are increasing their lending to shipping, do not entirely comply with the Poseidon Principles. “Western banks’ exposure to shipping, in contrast, has been declining, so progressive mandates from the EU, US, or UK lenders may be outweighed by less progressive behaviour by Asia Pacific or Greek lenders, and the correct balance could be missed in these indicators if their debts are not captured,” underscores the report.
Sustainability-related loans and bonds issued to shipowners and operators have progressed, reaching about $10 billion since 2021. However, not all the financing
Increase the share of shipping debt aligned to trajectories needed to meet 2030/50 targets
Increase in willingness to report financing attached to shipping and its alignment to climate targets
PARTIALLY ON TRACK
PARTIALLY ON TRACK
Increase or maintain sufficient issuances of sustainabilitylinked loans and bonds to ship owners and operators
Mobilise industry funding for SZEF bunkering and production investment
Increase public finance (i.e., grants, loans) for SZEF-related activities
PARTIALLY ON TRACK
Alignment of known portfolios to be below 10% for as much of observed shipping debt as possible. A greater percentage of this to be below 5% than in 2022 (more than 14%)
Greater transparency of debt from APAC and Greek lenders through inclusion in Poseidon Principles
Continued or improved transparency from Western lenders
50% of total ship financing to be covered under Poseidon Principles targets.
Maintain or increase the share of total sustainability-linked debt issued to shipping
Total cumulative amount to reach at least US$20 bn (x2 2022 level)
Conditions for eligibility and use of sustainabilitylinked loans to strengthen towards SZEF
Given stricter targets for 2030 Poseidon trajectory, the same requirement as in 2025 to stay below 10% and a larger share to be below 5%
2/3 of total shipping debt to be transparent about alignment to Poseidon Principles targets.
However, progress in SZEF decarbonisation is predominantly within developed economies, indicating a regional bias. Greater participation worldwide, especially from the Global South and developing economies, is essential to achieve broader international advancement towards the 5% target by this decade’s end.
Similarly to 2022, governments aiming for 1.5°C-aligned decarbonisation plans are still just partially on track. For instance, “only” 5% of IMO Member States submitted their National Action Plans regarding shipping decarbonisation (but that 5% accounts for over 29% of ownership and more than a quarter of registered tonnage).
Cumulative amount of sustainability-linked loans and bonds to US$50 bn
Conditions for eligibility and use of sustainability-linked loans to become focused on SZEF-related assets
PARTIALLY ON TRACK US$1 bn/year by 2025US$25 bn/year by 2030
PARTIALLY ON TRACK US$2-4 bn in total by 2025US$6-10 bn in total by 2030
is consistent with or even linked to SZEF and related assets; therefore, at this point, these financing trends show “only an appetite to acquire such financing mechanisms in the industry,” highlights the report. Sustainability-linked loans and bonds to ports and shipyards have also been issued, but it is unclear if they are being directed towards SZEF-related projects. More funding, estimated at $7.7b, has been declared by governments for shipping decarbonisation; yet, it needs to be distributed more evenly (geographically speaking, as most commitments are coming from the EU and US) and explicitly allocated to SZEF adoption.
Going forward, national policies should ensure better alignment of funds with SZEF goals, considering uncertainties such as revenue from shipping’s inclusion in the EU Emissions Trading System (EU ETS). “This would mean that a portion of the funding will depend on the carbon price at the time, the actual or alternate usage of those revenues, as well as the rate at which shipping gets included into the EU ETS,” the report points out. Generally, the progress of the finance lever is partially on track.
Policy actions across various sectors, both domestically and internationally, have an excellent opportunity to accelerate shipping decarbonisation. Naturally, the best course is a comprehensive approach that includes global, national, and regional initiatives, which have a combined impact on driving progress.
Several classification societies are showing positive signs of improvement in developing frameworks and guidelines compatible with SZEF. The IMO is actively working on bunkering safety standards, which will also influence safety developments related to SZEF within the International Association of Classification Societies. Nationally, many countries are advancing regulations to support domestic maritime decarbonisation and increase SZEF production. Among the top 20 countries, 16 have released hydrogen strategies or roadmaps, and the majority already have policies benefiting domestic decarbonisation and, thus, greening the maritime sector. Notably, the UK and EU have integrated shipping into their carbon pricing mechanisms alongside other EU initiatives like FuelEU Maritime.
In terms of progress towards production targets for SZEF and the availability of green hydrogen by 2030, about 55mt of green hydrogen would be needed to achieve the required amount for the 5% SZEF goal. However, most optimistic forecasts suggest only 24mt of green hydrogen supply by 2030, while non-maritime annual hydrogen demand by that year is estimated at 130200mt. Considering the need for other sectors to decarbonise along the 1.5°C trajectory, a significant portion of the estimated 24mt of green production capacity will likely be required to meet non-maritime hydrogen demand. Thus, it’s crucial for governments to continually review their hydrogen strategies and policies to sustain maritime demand.
Progress has been notable within the multilateral policy arena, particularly with the adoption of the 2023 IMO GHG Strategy during the 80 th meeting of the Organization’s Marine Environment Protection Committee. The Strategy, with its “indicative checkpoints” (the target of achieving net-zero shipping GHG emissions before/around 2050) and the consideration of viewing emissions from the wellto-wake perspective, signifies international advancement compared to the year before. Such progress underscores the necessity for national governments and industry stakeholders to prepare for a decarbonised future through increased national actions and sector commitment to SZEF.
Additionally, the decision of the 2023 GHG Strategy to implement mid-term measures to be enforced by 2027/2028 is welcomed. However, it’s essential to accompany all these ambitions with specific technical and economic instruments to achieve outcomes consistent with decarbonisation targets. Furthermore, addressing how wellto-wake emissions will factor into these measures (presently under development for the IMO Life Cycle Assessment guidelines) is imperative to ensure effective GHG
Classification societies research and set operational, bunkering, and safety standards for SZEF
Governments publish 1.5°C-aligned decarbonisation plans for domestic shipping
Governments set production targets for zero carbon fuels (intermodal usage)
Governments create policies targeting SZEF adoption in maritime
Submission to IMO of NAPs to address GHG emissions from international shipping
IMO to agree mid- and longterm measures for shipping (e.g., MBMs and non-MBMs) which are aligned with 5% SZEF and decarbonisation by 2050
IMO to require new ships to be zero-emission ready (e.g., GHG reduction plan with zero-emission (SZEF) propulsion capability)
IMO to adopt guidelines to estimate well-to-tank GHG emissions and regulation/ incentives for SZEF
IMO agrees on comprehensive decarbonisation strategy and zero emissions by 2050 target
PARTIALLY ON TRACK
PARTIALLY ON TRACK
ON TRACK
PARTIALLY ON TRACK
NOT ON TRACK
PARTIALLY ON TRACK
In place for 10
In place – at least five large classification societies
In place for 10 out of top 20 countries
In place for 10 out of top 20 countries
Clear policy support
In place for 10 out of top 20 countries across the board55
In place for 20 out of top 20 countries
In place for 20 out of top 20 countries
Policy to meet 0.6 EJ target in terms of hydrogen and ammonia/methanol production
In place for 20 out of top 20 countries across the board
In place for 20In place for 100
Mid-term measures agreed
NOT ON TRACK
PARTIALLY ON TRACK
ON TRACK
Long-term measures agreed
In place
In place
In place
ports
mitigation. Overall, the report finds that policy actions are partially on track.
Lastly, the report analysed civil society as a change lever in SZEF adoption. Clearly, the role of non-governmental organisations, local communities, and diverse collectives has been vital in advancing decarbonisation in the shipping industry. Civil society’s involvement is crucial not only for environmental reasons but also to ensure equitable access to economic benefits from SZEF initiatives.
Bodies such as the International Transport Workers’ Federation or Transport & Environment have been demonstrating a commitment to decarbonisation for several years, and communication between vulnerable states and the IMO has also continued. Various organisations, including the Inuit Circumpolar Council, have gained Observer Status at the IMO. At the same time, the Zero Emission Ship Technology Association and the Environmental Defense Fund were given the IMO Consultative Status, reflecting a trend toward inclusivity.
However, ongoing efforts – nationally and locally – are necessary at all levels to ensure transparent and inclusive decisionmaking processes regarding SZEF adoption and policy development. This includes stakeholder consultations, data sharing, public discussions, and increased representation of civil organisations from the Global South at IMO’s floor. According to the report, while progress has been made since 2022, at the present moment, civil society involvement can be qualified as only partially on track.
The 2023 analysis of the climate action in shipping shows that the overall progress in reaching the 5% by 2030 SZEF goal has remained partially on track compared to 2022. Significant global progress has been made in the past year, with commitments at the IMO, shifts in national policies, updates within industries, and technological advancements.
Nonetheless, substantial efforts are still needed to achieve the 5% target, particularly in terms of national policies that translate into concrete actions, especially in terms of increasing clean fuel supply. Furthermore, tech advancements must be utilised to ensure an adequate SZEF provision by 2030, expanding production and making significant investment decisions.
Finally, ensuring a broader range of funding sources, policies, and projects while sustaining and enhancing civil society involvement is essential to promote fairer distribution across geographic regions.
The fight against climate change is one of the most pressing challenges facing humanity. However, achieving meaningful progress for the shipping sector requires a nuanced understanding of the main drivers and opportunities that will influence future decarbonization trajectories for the industry. This extends beyond purely technical considerations: it is essential to consider key factors across the entire value chain, accounting for the broader economic context in which the transition is taking place.
To address this multifaceted challenge, Bureau Veritas Marine & Offshore (BV) has developed a bottom-up model. It is built on the premise of the micro-attributes of the global shipping fleet, accounting for the different segments and vessel types, to simulate the overall effects at a macro level. By reflecting the dynamics and inertia of the global shipping industry under different drivers, we can calculate how the fleet’s greenhouse gas (GHG) emissions might fluctuate according to key influences. This enables us to understand the various potential decarbonization trajectories in the shipping industry – and, from there, outline the practical solutions and collaborative strategies that will be necessary to navigate this complex voyage.
Rather than reiterating the broad significance of decarbonization, BV’s Decarbonization Trajectories study looks at what the journey may look like in practice. By acknowledging the intricate interplay of market dynamics, economic considerations, and technological advancements, we aim to provide actionable insights for stakeholders seeking to integrate sustainable practices into their corporate strategy.
We must start by asking which key measures can have the most impact on addressing climate change. Drawing on BV’s wideranging expertise, our study has identified actionable levers toward decarbonization.
A fundamental starting point for any calculation of climate impact is to consider shipping’s ‘GHG budget to 2050’ instead of solely focusing on emission levels at the end of the journey. In short, we need
1 IMO announced that its ambition after MEPC80 is to “reach net-zero GHG emissions by or around, i.e. close to 2050.” In this graph, the most ambitious of the two IMO trajectories reaches zero emissions by 2050 while the trajectories representing the minimum ambition of IMO reaches zero emissions by 2057. Emissions are calculated for international shipping on a well-to-wake GHG emissions scope
2 Tank-to-well from 4th IMO GHG Study and well-to-tank estimated based on fuel share from 3rd IMO GHG Study
Source for figs. 1-3: BVS bottom-up model
to focus on the total amount of CO2 that can be emitted up to the point of carbon neutrality. This is essential because climate change is directly linked to the total quantity of GHGes present in the atmosphere, not only those emitted annually.
Our results show that if we are to keep shipping within its 2050 GHG budget, operational measures and energy-saving technologies must be prioritized, especially early on when emissions are at their highest. The significance of reducing speed and minimizing waiting times cannot be overstated, as a ship’s fuel consumption typically adheres to a cubic law in relation to its average speed during sailing time. BV’s simulations show that without action to
reduce speed or waiting time while ocean transportation volumes grow moderately to reach a 50% increase by mid-century, GHG emissions would be 92% higher in 2050 – with 44% more emissions over the period from a GHG budget perspective –than if these levers had been actioned. The pathway to 2050 is just as crucial as the emissions remaining by that time.
These actionable levers offer hope for substantial emission reductions globally. By exploring the various facets of this transition, we aim to provide insights into how stakeholders can navigate the complexities of decarbonization while balancing the need for sustainable practices with economic viability.
Prioritizing operational optimization and energy efficiency not only reduces emissions but also enhances cost savings and operational performance. By decreasing vessel speed, minimizing waiting time in ports, and adopting energysaving technologies, shipping companies can lower fuel consumption per voyage, thus curbing their carbon footprint while reducing costs. The proven long-term economic viability of these measures – especially when compared with options relying on the use of alternative fuels – aligns decarbonization efforts with financial objectives and market dynamics, ultimately providing a strategic advantage.
Digitalization emerges as a central facilitator, enabling enhanced data monitoring at both a vessel and fleet level for optimization purposes and facilitating the modeling of technology impacts. Moreover, energy-saving devices and technologies, such as low-friction hull coatings and autonomous hull-cleaning robots, offer favourable avenues for efficiency gains. Wind propulsion also presents a promising option for emission reduction, with increasing interest and adoption observed in recent years.
By focusing on operational optimization, companies can lower fuel consumption and emissions per voyage. Our report underscores that even small reductions applied to a large portion of the global fleet can result in substantial fuel savings and emission reductions, having a bigger influence overall than larger overhauls that may take place gradually over a longer period. Widely adopted measures with immediate – even if smaller – impacts will likely see their effects amplified over the run-up to 2050, showcasing the effectiveness of operational measures in driving decarbonization efforts.
Failure to act swiftly risks impeding progress toward global targets and exacerbating atmospheric and oceanic GHG accumulation. While long-term decarbonization goals rely on renewable and low-carbon fuels, embracing existing technologies and efficiency measures today is essential for steering the maritime industry toward a sustainable future.
However, amidst the array of available solutions, proven results remain paramount. Shipowners seek clarity on performance, safety, crew training, and return on investment before committing to new technologies. Collaboration between classification societies and technology developers becomes even more crucial in
demonstrating the technical viability and safety of innovative solutions.
Energy insetting: everybody can move the needle
Decarbonizing the maritime industry requires more than just advancements in alternative fuels and propulsion technologies. It demands a holistic approach encompassing the entire value chain. Moving the needle on fuel production requires pragmatic solutions to unlock the necessary investment to reach the required scale. New mechanisms will have to be implemented to transmit signals from buyers to sellers to create the conditions for shipping’s decarbonization to take place.
In addition to the upstream production of renewable and low-carbon fuels, we should focus our efforts on both ends of value chains. Developing shared platforms to aggregate the demands of stakeholders who wish to decarbonize their supply chains and thus form sufficiently large end-markets to sustain green shipping services will be pivotal.
This highlights the critical role of energy insetting – investing in interventions within an organization’s own value chain – in bridging the price gap between conventional and renewable or low-carbon fuels in the shipping industry. All projections show that running shipping on renewable and low-carbon fuels will be significantly more costly than using fossil bunker. Unlike other market mechanisms, energy insetting directly reduces GHG emissions by implementing interventions throughout a company’s value chain.
Verified by third parties, robust quality frameworks and certification schemes can enable the monetization of emission reductions achieved through renewable or lowcarbon marine fuels. By utilizing blockchain technology for security, digital platforms ensure secure and traceable transactions, creating a transparent marketplace through the exchange of digital tokens representing emission savings. This approach not only addresses economic challenges but also connects stakeholders from both the supply and demand sides, stimulating the production of sustainable fuels at scale.
Source: BVS bottom-up model & IEA WEO 2022
the Baltic
One recent example from the Baltic Sea region includes the Swedish coffee maker Löfbergs, which has contracted the logistics company Scanlog (also from Sweden) to carry its shipments by vessels using bio-liquefied natural gas (bioLNG) per the massbalanced approach. This move is said to reduce Löfbergs’ sea freight carbon footprint by 100%, with the company (importing some 36 thousand tonnes of raw coffee each year) paying for bioLNG. Kajsa-Lisa Ljudén, Head of Sustainability at Löfbergs, commented, “Biogas costs more than fossil fuels, but we think we cannot afford to do otherwise. We have to reduce emissions across the entirety of our value chain. That we are financing the fuel switch 100% means that we see a functioning solution, which will hopefully contribute to others making a change, too.” Matilda Jarbin, Scanlog’s Chief Sustainability & Communications Officer, added, “Sea transportation has long found itself under the radar. It is, therefore, important that companies like Löfbergs dare to go further, seeing it’s possible to reduce emissions here & now. We hope this will inspire other firms, speeding up the necessary transition within the transport sector.”
The shipping industry comprises diverse segments, each facing unique requirements and economic pressures, resulting in differing capacities for decarbonization. Varying in vessel size, type, routes, public scrutiny, and autonomy needs, these sub-sectors experience distinct exposures to market conditions and regulatory frameworks. Moreover, companies within each segment differ in size, business model, and financial standing, influencing their ability to adopt sustainable practices.
One should also remember that the shipping industry is a deeply fragmented market. While it greatly depends on the segments under consideration, a significant portion of the global fleet is owned by a myriad of smalland medium-sized companies, many of them operating in fast-evolving markets. In addition, these companies may only keep their assets for part of their service life and have relatively modestly sized technical departments (all adapted to their needs and operating model). There are
also the diverging priorities of shipowners and charterers: whereas the former might prefer to, e.g., slow steam to gain a better Carbon Intensity Indicator score, the latter might be inclined to speed up to carry out more sailings.
Decisions on emission reduction strategies must thus be tailored to each vessel, considering factors like fuel options, technological limitations, real-world market conditions, and operational requirements. There is no universal solution due to the industry’s diversity and complexity. Understanding these varied challenges is crucial for progress in the shipping industry’s decarbonization
efforts – and this is why our research takes this diversity into account to outline realistic decarbonization scenarios.
As the maritime industry progresses toward decarbonization, stakeholders must optimize business and operating models to align with evolving market conditions and regulatory expectations. Collaboration remains pivotal, shifting from adversarial contractual frameworks to benefit-sharing models that incentivize emissions reductions.
Moreover, gaining visibility on long-term regulatory expectations and fostering international consensus is essential for informed decision-making and effective industry-wide decarbonization efforts. Despite the challenges posed by differing national priorities and means, there is growing recognition of the need for collective action toward carbon neutrality.
While consensus may be challenging, universal goals for environmental preservation transcend individual interests and necessitate global cooperation. Ultimately, addressing the complexities of decarbonization requires a nuanced approach that balances ambition with practicality and embraces collaborative efforts across the maritime sector.
Bureau Veritas is a world leader in inspection, certification, and laboratory testing services with a powerful purpose: to shape a world of trust by ensuring responsible progress. With a vision to be the preferred partner for customers’ excellence and sustainability, the company innovates to help them navigate change. Created in 1828, Bureau Veritas’ 83,000 employees deliver services in 140 countries. The company’s technical experts support customers to address challenges in quality, health and safety, environmental protection, and sustainability. Visit bureauveritas.com to discover more.
Port of Trelleborg has been granted roughly €40 million in EU grants between 2015-2023 for the expansion and relocation of the port. Port of Trelleborg is constantly working to develop the port and has parallel to infrastructure investments worked to apply for grants from the transport unit (TEN-T) in the EU for many years. The port is currently engaged in different major EU projects and has earlier received several applications approved, partly due to the fact that Port of Trelleborg is an important part of the European transport corridors and one of Sweden’s five designated core ports by the EU.
Through the projects, we can contribute to a better transport corridor and promote and streamline the infrastructure in the new port to be able to meet tomorrow’s traffic volumes in the best possible way. The combined focus of the activities also goes hand in hand with Port of Trelleborg’s long-term environmental work.
Ongoing projects and activities:
• Ferry berths no. 11 and 12 (each 250 meters long)
• A treatment plant for receiving the vessels’ waste water
• Two 120 meters high wind turbines in the port to provide electricity to vessels
• Improved handling of intermodal trains and rail connections
• Side ramp in ferry berth no. 10
• Side ramp in ferry berth no. 13
• Trailer parking
• Digital monitoring system and digitalization tool
Lead partner i 3 stora EU
Lead partner i 3 stora EU-projekt
• Completion of the eastern port area in the Port of Trelleborg, including asphalt, filling, installation of electricity, IT, telecom etc.
Partner i 2 stora EU-projekt
Partner i 2 stora EU-projekt Rail-IT
• ”What does the fuel of the future look like?”
Blue Supply Chain (2023-2025)
• ”What do the capacity possibilities of the future look like?”
Green FIT 2025
Rail-IT
Green FIT 2025
Digi MoS
Offshore wind energy (OWE) is one of the leading topics in the maritime industry. For this reason, the Baltic Ports Organization (BPO) decided to take a closer look at this issue. The second day of Transport Week (12-13 March 2024), held in Gdynia, was entirely devoted to the opportunities and challenges that Baltic ports face in this respect. The points discussed included current projects in the Baltic Sea region (BSR) and the possibilities of achieving EU and Baltic targets for installed OWE capacity for 2030.
Important discussion topics also covered the OWE farm construction logistic chain, how to make room for OWE projects within port spatial development plans, and devising an overall offshore strategy for the BSR port & shipping sectors as they face the growing demand for handling different OWE tasks (installation, maintenance, service, etc.), urgency to add proper infrastructure that can cater to the rapid technical progress (ever-bigger wind turbines, among others), as well as supplying the OWE fleet. In his opening speech, Bogdan Ołdakowski (Baltic Ports Organization) welcomed the event’s guests and mentioned these and many more opportunities and challenges lying ahead in the OWE store for Baltic seaports.
Mariusz Mazur (Ramboll Poland) compared the Baltic with the North Sea in terms of OWE development projects. He evaluated that favourable wind conditions are by all means present, but the Baltic Sea needs to tick off a few boxes to harness them accordingly. Among them are developing the supply chain (especially of products & services made in Europe), building the regional expertise, and streamlining regulations so that they don’t stand in the way of executing OWE projects in good time and on budget (which is also advisable from the EU’s green transition perspective). Poland, in particular, can leverage its industrial strength to
become the region’s dominant OWE power.
As a case in point, Aleksandra Jampolska (Ocean Winds) presented her company’s OWE development plans in the country. She showcased the 500-megawatt BC-Wind OWE farm that is being developed in Northcentral Poland (23 km off the coast). The investment is scheduled to come online in 2027. Aleksandra also underlined the importance of knowing the ‘local climate’ (regulations, requirements, and business possibilities) as OWE is a pioneering endeavour in the Baltic east of Denmark and Germany. The Baltic is in and of itself a very specific sea, or as she added, a ‘big salty lake’ with its seabed still littered by war remnants and wrecks, not to mention the sometimes much more than demanding winter weather.
What are the main challenges on the path to reaching the EU and Baltic’s 2030 OWE capacity goals?
Niels Malskær (Royal Danish Embassy in Poland) pointed out that investing in OWE is a risk worth taking. He detailed how his home country placed its bet on wind energy, successfully blazing the trail when others were still considering whether the juice was worth the squeeze. Denmark is now a wind energy powerhouse, rubbing its hands with glee at the prospect of exporting the country’s products & services.
Linas Sabaliauskas (Lithuanian Wind Power Association) stressed the importance of the end users of OWE. There is
a great need to show its strengths and raise awareness of those who will actually use it, both at the local and global level. Edgaras Trijonis (Moffatt & Nichol) noted that the lack of infrastructure to support OWE farms and financing issues remain significant obstacles.
The role of ports in OWE success
Tom Saelens (DEME Group) displayed his company’s expertise in specialised maritime operations, including dredging, land reclamation, infrastructure set-up, and, naturally, all-around development of OWE farms. He stressed the role of marshalling ports in offshore wind logistics: ship bunkering, crew changes, equipment storage, repairs, and more. According to DEME, an ideal OWE port would be one with 24/7 access, meaning, among others, not too few (for efficiency reasons) but also not too many port workers (for safety) overseeing cargo handling. Of course, the perfect ‘wind port’ would be located close to OWE development areas, provide the proper infrastructure (such as quay & yard bearing capacity) and conditions (OWE components must be kept clean), grant priority quay usage and flexible port dues (as OWE shipping significantly differs from other ship calls). Access to local professionals can also be a game changer, such as when repairing something on the spot (e.g., an electrical issue), which can save tens of thousands of euros in project execution. Lutz Dröge (DEME Group) put the
spotlight on two OWE ports in the Baltic –the Danish Rønne and the German Mukran.
Subsequent panellists reflected on how to fit OWE developments into a port’s master plan to get the most bang for an investment buck. Jesper Bank (Port of Esbjerg), as a representative of the world’s largest base port for OWE activities, shared his extensive experience and dived deep into the nitty-gritty of OWE logistics. Whereas it can be a trial-and-error operation that will certainly give you as a port a few sleepless nights, the business pays handsomely. Jesper also underlined that there won’t be any real port OWE competition in the foreseeable future, as the demand far surpasses what ports can supply. Therefore, it is of utmost importance that seaports collaborate to make the European wind dream a reality.
Lech Paszkowski (Baltic Hub) presented how the biggest sea container terminal in the region intends to tap into OWE by presenting T5, an installation base in the Port of Gdańsk. The €116 million investment will see the creation of two 17.5-metre deep berths: 451 metres for installation and 349 m for maintenance purposes. Additionally, the terminal will include a ro-ro berth. Patrick Walison (Royal HaskoningDHV) focused on defining the role that a given port wants and can play. Knowing your place, so to speak, is crucial in deploying infrastructure that will actually be used.
In his bitter-sweet presentation, Patrik Hellman (Port of Kaskinen) focused on the potential of Coastal Ostrobothnia ports in facilitating OWE development up in the Northern Baltic – and all the stumbling blocks they need to jump over to do it.
Concerning the former, Finland has big plans, which, regarding the latter, may be undermined by port development that’s not proceeding at the speed it could. Patrik is in favour of cutting the red tape for port development, as well as supporting it with robust financing. Should Finland lag in developing its own OWE port network, other Baltic seaports will be more than happy to seize the opportunity to assist the country in setting up farms off its coast.
The key takeaway from Vitalij Muštuk’s (KLASCO) presentation was his company’s construction project that will see the rebuilding of the former international ferry terminal in Klaipėda into Lithuania’s first offshore wind assembly and loading facility. The 21-hectare terminal should be ready in 2026. Margus Vihman (Port of Tallinn) presented an ongoing project in the Paldiski South Harbour, where the Port of Tallinn is erecting a dock to serve the OWE industry (land reclamation works started towards the end of January 2024). The €53m investment will result in a 310 m
long quay and an adjacent 10 ha yard. Aneta Szreder-Piernicka (Port of SzczecinŚwinoujście) highlighted OWE developments across her ports: PKN ORLEN’s OWE installation terminal due for commissioning in 2025 (two berthing places, each 250 m long), Vestas’ second OWE factory in Szczecin (for producing blades for the company’s biggest V236.15.0MW wind energy turbine model; Vestas will also have its nacelle assembly factory next door), Windar’s plant in Szczecin (tower production centre), and Szczecin-Świnoujście joining the Offshore Wind Port Alliance in February 2024 (a co-op set up to share expertise and infrastructure to speed up OWE installations throughout Europe).
Just after the conference, the time came for the first meeting of the group in question. Bogdan Ołdakowski started the session, during which the participants discussed the perspectives for OWE in the Baltic, investments in ports, main challenges (high CAPEX, among others), and competition issues. The group also specified its main tasks: learning the inner workings of OWE construction and O&M processes, blueprinting sound OWE business models, and going on study visits to existing OWE terminals in Europe.
Technological innovation drives the maritime industry forward, improving safety and propelling decarbonization. However, many new technologies face challenges in aligning with existing regulations. DNV’s Technology Qualification (TQ) process bridges this gap, as demonstrated by the Candela P-12 ferry.
Several completely novel technologies have emerged in shipping in recent years, increasing the energy efficiency of vessels or facilitating the use of alternative fuels. However, due to their novelty, many of these innovations operate
beyond the confines of established regulatory frameworks. This creates uncertainty that can negatively impact the innovation process.
“Many shipowners are currently evaluating the adoption of novel technologies at different stages of readiness. However, this introduces inherent risks concerning the effectiveness of energy efficiency measures and fosters uncertainty with respect to investment decisions,” says Carl Erik Høy-Petersen, Business Development Leader, Maritime Advisory at DNV.
The need for a different approach to support new technologies
These uncertainties have created a need for assurance in the development of novel technologies. With the TQ process, DNV Maritime Advisory provides clients with high-end consultancy throughout the innovation process, independent of its classification services.
Technology is often far ahead of regulation in the maritime sector, so we need alternative approaches to ensure the safe implementation of innovative technologies. This inspired TQ to become a methodology and process at DNV. With it, we have been able to qualify a variety of maritime technologies, such as fuel cells in cruise ships, propulsion systems, waste treatment systems, and the introduction of new marine fuels, among others.
Technology Qualification provides evidence that technology will function within specified limits with an acceptable level of confidence. In practical terms, this means that companies wanting to develop novel concepts will engage with DNV from the early stages of their innovation process to gain an independent evaluation of their technology.
DNV experts work closely with clients to develop a deeper understanding of their technology, focusing on several different perspectives, such as safety, efficiency, operability, and profitability. The results provide the clients with insights into how their technology can fail at any stage of its
journey, supporting them in establishing a more robust development, manufacturing, testing, and commissioning plan. Identification of technical, compliance, safety, or performance issues at the earliest possible point in the development process helps minimize the cost and time of rework. This way, the TQ process helps reduce the expenses
of qualifying new technologies and reduces to-market time.
At the core of the TQ process is an iterative, systematic approach that addresses each stage of the technological journey. This starts with an initial qualification basis, working
through technology assessment and threat assessment (hazard identification, HAZID, and failure mode, effects, and criticality analysis, FMECA), all the way through to
qualification plan, qualification execution, and performance assessment. If the technology is deemed to be below the required standards, practical recommendations will
be made, usually resulting in alterations. As a main principle, we engage in close dialogue with our clients, leveraging their knowledge and expertise alongside that of our subject matter experts at DNV. Together,
we systematically address challenges and uncertainties and identify inherent hazards in each technology. This provides us with a high-level risk assessment, not only covering safety-related matters but also looking
at other important aspects like efficiency, maintainability, profitability, public opinion, and environmental aspects. This holistic approach prepares the technology for social and economic realities.
Candela is a prime example of an innovative organization that has benefited from a close partnership with DNV through the TQ process. For the past few years, the Swedish company has been developing the Candela P-12 ferry based on hydrofoil technology, successfully launching the vessel towards the end of 2023.
Hydrofoil technology – where a foil lifts the vessel from the water as it gathers speed – has a range of benefits. “The key advantage is that the hydrofoil system reduces energy consumption by more than 90% compared to conventional diesel vessels if one calculates savings from energy
Partnership with DNV through the TQ process has been a key part of the development of this unique craft. “The TQ process is more detailed and comprehensive compared to standard type approvals for conventional vessels,” says Rasmus Kratz, Compliance Engineer at Candela. “While
converted from battery/diesel to propulsion,” explains Kratz. “This, in turn, enables long range and high speed on battery power only – a first in the industry – and halves operational costs.”
Hydrofoil technology is also ideal for operation in busy urban environments,
the risks with traditional boats are widely recognized and understood, the TQ process compelled us to meticulously assess and address the unique risks involved in constructing an electric hydrofoil vessel. This has ensured that the P-12 is designed to be an exceptionally safe watercraft.”
where vessels often face added restrictions. “One of the key advantages of this technology is that it has low wake generation,” continues Kratz. “This makes it exempt from speed limits in cities like Stockholm, which increases its attraction as a passenger ferry.”
“Candela consulted DNV at an early stage of the development,” says Kristoffer Uulas, Senior Consultant, Maritime Advisory at DNV. “They had questions about safety and compliance but also about how to navigate the approval process for a new technology that doesn’t fit any of the currently existing rules.”
This early engagement with DNV experts provided Candela with the confidence that their concept was fundamentally sound, smoothing the path of further technological
progress and development. “We moved from the general concept of the foiling technology through to HAZID challenges and uncertainties,” shares Uulas. “This provided a solid basis for the qualification and further development of the technology.”
The identification of potential hazards and pitfalls throughout the TQ process often led to alterations to the originally planned technological pathway. Mitigation of potential risks and failure modes was ensured by executing the qualification plans, providing
evidence through analyses and tests, and adding control measures in design, manufacturing installation, commissioning operation, and maintenance. Doing this has made the P-12 safe, robust, and prepared to deal with any challenges that it might face in the future. “There have been a lot of changes and iterations to the design along the way, and DNV has been a vital part in helping Candela navigate this map, providing evidence through the qualification plan,” adds Kratz.
Clearly, understanding the risk picture has helped the Swedish innovators adjust the technology to achieve a higher level of safety and redundancy beyond
the initial plans.
Rather than merely aiming for compliance, Candela chose to have more redundancy and safety functionality
throughout the process than required. This has increased the vessel’s reliability, minimizing the risk of safety incidents or technical failures in the future.
As the successful launch of the Candela P-12 prototypes in 2023 has shown, close cooperation with DNV through the TQ process provides a sound basis to assure future safety performance and operability, increasing the likelihood of vessels reaching full development stage, while also improving their future economic prospects.
“Introducing a totally new type of vessel, which is significantly more sustainable than anything that has come before, has been a complex process,” concludes Kratz. “Drawing on DNV’s experience and expertise through the TQ process and partnering with some of the foremost experts in marine safety has been invaluable to its development.”
DNV is the world’s leading classification society and a recognized advisor for the maritime industry. We enhance safety, quality, energy efficiency and environmental performance of the global shipping industry – across all vessel types and offshore structures. We invest heavily in research and development to find solutions, together with the industry, that address strategic, operational, or regulatory challenges. Visit dnv.com/maritime for more information.
Ship Design
Group at the University of StrathclydeOne area of ship operations that has attracted much attention in recent years due to the possibilities it represents for emission reduction is that of cavitation. During ship operations, cavitation occurs because of vortices that build up and cause bubbles to collapse under the ship’s propeller. The results of this process include increased noise, vibration and energy usage. The latter is of particular concern for vessels looking to streamline their energy profile. There is a hydrodynamic solution that delivers multiple benefits for shipowners facing increasingly tough regulatory requirements and rising operational costs.
Existing energy-saving designs for propeller hub caps or boss caps incorporate fins that act to improve vessel efficiency by reducing cavitation while ships are at sea. However, the finned design generates turbulence and is linked to cavitation as bubbles form underwater.
At EcoMarine Innovations, a pioneering start-up supported by the University of Strathclyde, we set ourselves the goal of addressing these issues while working on a project with a major European propeller manufacturer. During this collaboration, we learned that cavitation is a major cause of inefficient ship operations, accounting for 3-8% of lost propulsive efficiency.
Convinced that it must be possible to develop a better way of addressing this efficiency cost and related environmental impacts, we studied the design of boss caps commonly used on ships. In the course of this research, we began exploring the idea of designing a boss cap that utilises holes instead of any structure that can cause
turbulence or operational risk. The result is the Holy Boss Cap (HBC).
The development of the HBC demonstrates the importance of research support of the kind we have at Strathclyde University. The product, which was launched in February 2024, eliminates propeller hub vortex cavitation, the main source of rudder erosion, and reduces associated propeller efficiency losses. However, an early version of the innovative ‘holy’ design failed to gain traction as it was not hydrodynamically efficient, as the holes reduced the efficiency of the propeller.
The revised HBC design, which we implemented following extensive studies in partnership with the University, addressed these problems with carefully placed and angled holes bored into a conically shaped hub. The holes channelled into the hub affect the high pressure in the hub vortex by redirecting the flow downstream. The resulting lowpressure swirl flows in the opposite direction
to conventional hubs behind the propeller blades, reducing propulsive drag, fuel consumption and maintenance costs.
To assess the effectiveness of the new design, we carried out computational fluid dynamic (CFD) tests on a typical twinscrew vessel with V-brackets and a 90-metre coastal general cargo ship. Using local workstations running parametric optimisation software combined with CFD software, we studied the effects of variables such as chamber volume and profile, number of holes, and angle of the holes.
When we compared the HBC with more advanced energy-efficient boss caps currently in operation, we found it to be at least 3% more efficient. Overall, compared to standard propeller boss caps, the HBC improved propeller efficiency by 3.1% and thrust by 1.1% while reducing torque by 2%, rudder cavitation by 10%, and propeller-induced noise by 1-3 decibels. We expect the HBC to be capable of delivering increases in propulsion efficiency of up to 5% vs conventional
propeller boss caps. These potential savings were further confirmed by a reputable European cavitation tunnel testing facility, which found savings of more than 2.1% despite challenging scale effects.
Given the pressing emission-reduction challenges that the shipping sector faces, we believe it is not enough to develop a solution without ensuring that it can be scaled in a meaningful way. Having successfully completed validation tests at a hydrodynamic research centre in Sweden, the HBC is undergoing ship model basin trials to verify the efficiency gains on larger commercial and naval vessels. Meanwhile, the patent for the HBC is pending, with the support of the University of Strathclyde in the patent application process.
It has become clear to us while developing the HBC that traditional methods of addressing ships’ energy wastage have failed to keep pace with the industry’s needs – or to consider the wider impacts of underwater noise and vibration. Zero propeller hub vortex cavitation can help towards environmental-social-governance, Energy Efficiency Existing Ship Index and Carbon Intensity Indicator goals, improve efficiency and reduce the costs associated with cavitation-induced rudder erosion. Driven by research, the HBC is meeting this need in the market and is contributing to more sustainable ship operations.
We are delighted that CFD trials have validated the HBC concept. Underpinning our efforts in bringing this product to
market is the drive to find the simplest way to address what is actually a very simple problem. We have achieved this by several metrics: installation of the HBC takes just five to six hours, and the product can easily be retrofitted or installed on new vessels. Once fitted, the product can be maintained during routine drydocking visits. In addition, the HBC offers reduced CAPEX compared to existing devices: thanks to the ease of casting and the lower amount of material required,
it costs significantly less to manufacture than current conventional propeller hubs. The business case for shipowners is compelling. Taking the example of a 250-metre vessel that consumes about 35 tonnes of fuel per day, operating for approximately 240 days a year, and assuming a 3% saving, the return on investment is around five months. We have already received significant interest from shipowners and propeller manufacturers and are engaging with potential partners to take the concept to market.
EcoMarine Innovations is a pioneering research group in the Department of Naval Architecture, Ocean and Marine Engineering at the University of Strathclyde, dedicated to developing cutting-edge technologies for the global maritime industry. Sail to ecomarineinnovations.com to learn more.
Results of a global survey on the current state of automation in container terminals & the trends shaping its future
The way to go (in spite of a few roadblocks)by Peter Szelei, Senior Director of Business Development, FERNRIDE
Over the past decade, technology innovations have fueled widespread digital transformation across global industries such as healthcare, telecommunication, and manufacturing. Maritime transportation, however, despite handling over 80% of international trade, has been slow to adopt new solutions. Yet, disruptive global events and persistent challenges, such as skilled labor shortages, among others, have exposed the increasing fragility of the worldwide supply chain. These pressures are driving industry professionals to evaluate and introduce new technologies to increase efficiency, worker safety, and environmental sustainability.
In its recent survey, FERNRIDE asked container terminal professionals from across Europe, the Middle East, Africa, Asia-Pacific, and the Americas about the present levels of automation in their terminals and the technology trends they plan
to follow. The majority (67%) ranked the level of automation in their terminals as ‘low to moderate.’ Still, the overall sentiment was clearly toward increasing implementation.
This article summarizes the findings from the survey to paint a clear picture of the current state of automation in container terminals and examines the barriers to implementation. Finally, it explores the emerging trends most likely to influence decision-making and technology implementation in container terminals in the future.
Primary goals: What do container terminal professionals expect to gain from automation?
It is not surprising that efficiency improvements ranked the highest (Fig. 1), as small profit margins and the lack of skilled labor are global phenomena. While improving efficiency is the number one driver for automation across the board, for survey respondents on the executive level, this is followed by their ambition to improve safety.
Labor cost reduction is ranked second highest (20%). This desire is likely a byproduct of ongoing pressure to increase efficiency. Our survey showed that it is felt most strongly by those in operational roles, who must navigate external pressures, rising costs, and labor shortages on a daily basis.
Status quo: What automation solutions have container terminals already implemented – or are they planning to implement?
Optical character recognition (OCR) for gate automation ranks highest (Fig. 2) among the solutions that container terminal professionals are already using or have planned to implement. This is unsurprising as OCR is a mature technology that has already been proven across industries. The prevalence of OCR is an excellent example of a proven automation technology accelerating the primary goal of increasing efficiency while delivering a return on investment (ROI) relatively quickly by reducing congestion and turnaround times in terminals. “[Going from] a manual environment in the port where almost everything was paperwork, [gate automation] has significantly improved our efficiency and truck turnaround time. It’s the way to go in terms of efficiency, safety, and effective terminal operation,” shared one of the respondents.
Survey responses also showed that the implementation of newer technologies –such as the Internet of Things (IoT), remotecontrolled & automated equipment, and predictive maintenance – is increasing in maritime terminals. Advancements in these technologies are driving the introduction of robust and reliable solutions (such as remotely operated and autonomous terminal tractors and cranes).
Some 62% of respondents cited the high initial cost of technologies as the main barrier to implementing automation solutions (Fig. 3). Executive-level respondents ranked resistance from the workforce as their second highest
concern, along with a lack of skilled workers versed in new technologies. “In as much as people are willing to embrace automation in terminals, they are also concerned about the job security of workers,” one respondent said.
Those pushing for more automation also point to a lack of awareness about the right solutions and say that they have difficulty engaging stakeholders due to uncertainty about the reliability of new technology and its expected impact. Survey
respondents report that decision-makers prefer to prioritize small gains achievable with familiar solutions over the higher risk-reward ratio of new and transformative technologies. “Although managers say they believe that automation is necessary, they don’t really realize what they can achieve,” one of the surveyees told us. Operations managers are the most concerned with how automation integrates
with existing systems (60%) and any potential negative impact it might have on efficiency. Autonomous terminal tractors, for instance, must be able to navigate novel scenarios (like external truck drivers who don’t necessarily adhere to speed limits or follow designated routes, resulting in unpredictable behavior). “The complexities of mixing our manual operations with automation is one of our
key hurdles. For example, we will have autonomous trucks utilizing the same roadways as our manual vehicles,” commented one respondent.
Respondents in automation-related roles emphasized a need to increase awareness of existing automation solutions, fearing that terminals that fail to adopt these innovations will struggle to compete with more technologically advanced facilities.
The efficiency gains possible with autonomous technology also help terminals to become more sustainable by reducing fuel consumption and increasing productivity.
Autonomous terminal tractors, among other things, can run more efficiently than manually driven tug masters, leading to reduced emissions. Vehicles equipped with human-assisted autonomy can increase the productivity of the existing workforce by handling the majority of
driving tasks autonomously. This allows remote human operators to oversee multiple vehicles and only support autonomy remotely when needed.
Pressure is increasing across the logistics industry, including container terminals, to adopt more sustainable practices. In line with the implementation barriers for automated solutions, industry professionals rank the high initial costs of technologies as even more prohibitive when it comes to adopting sustainable practices (Fig. 4).
Survey respondents said that container terminals lack the budget to replace outdated technology and infrastructure. Those pushing for more environmentally friendly measures also described the difficulties they face in convincing stakeholders without a demonstrable ROI: “I strongly believe in improving the sustainability of port operations and that terminal automation helps in advancing sustainable practices. But I always get the same response [from stakeholders]: What’s the ROI?” Another said: “ROI is a big challenge
for any new technology implementation; it is difficult to capture the impact with numbers.”
Less than 6% of respondents said that enhancing environmental sustainability
Beyond assessing the current state of automation in container terminals, the survey results also indicate which trends we can expect to shape the future of automation in the industry.
Efficiency improvement and labor cost reduction are the main drivers for automation overall, but decision-makers will push to enhance safety, too. The general ambition for efficiency improvement and cost reduction reflects the persistent budgetary and labor challenges faced by container terminal professionals, particularly those in operations and IT. In contrast, executive-level respondents rated ‘enhancing safety’ as their second most important goal. Skilled labor shortages and cost restrictions will increase pressures to reduce risk in the workplace as executives push to attract new talent as well as retain existing workers.
Mature technologies with proven efficiency benefits are fast becoming the norm:
was their primary goal for implementing automation, and all of these worked in operations or automation-related roles. However, most of the workforce agrees
that an increased awareness of and commitment to sustainability is needed to drive the adoption of environmentally friendly practices.
High initial costs of sustainable technologies
Outdated terminal infrastructure
Lack of awareness or commitment to sustainabilit y
98% of survey respondents have already implemented (or planned to do so) technologies such as OCR for gate automation (60%), IoT and sensor integration (47%), and remotely operated equipment & automated stacking cranes (both 43%). We can expect these proven solutions to become the norm due to their predictable efficiency improvements. At the same time, advancements in newer technologies will also drive the implementation of more robust and reliable solutions (like remotely operated and autonomous terminal tractors).
Workforce acceptance and adoption will depend on the investment in training alongside new technologies. After the cost of tech, executive-level respondents are most concerned about the workforce resisting automation and lacking the skills to work with innovative technologies. Providing quality training will be instrumental to overcoming these challenges by upskilling the current
Forward-thinking container terminal professionals are already seeing the efficiency, safety, and sustainability benefits of early automation and remotely operated solutions. Now seeking to increase their awareness about the right solutions in an industry that can ill afford even the smallest setbacks, decision-makers must strike a balance between achieving efficiency gains and reducing labor costs while ensuring a smooth transition for workers and operations. Investment in training will
workforce and attracting new talent to the maritime transportation industry.
Container terminals will prioritize automation solutions that can be integrated into live operations. With efficiency improvements and cost savings set to remain the primary goals for implementing automation (particularly amongst operations, IT, and terminal development personnel), we can expect solutions that can be integrated into live operations without disruption and deliver near-term ROI to be most successful.
Autonomous solutions will also pave the way to greener practices. The efficiency gains will support the adoption of more environmentally sustainable practices. Pressure on providers to offer more data visibility will increase as stakeholders scrutinize the reliability and environmental impact of new technologies. The rate of change will also depend on how well policymakers communicate new requirements.
be central not only to filling skill gaps and ensuring acceptance of new ways of working but also to attracting the next generation of talent who bring along an increased awareness and knowledge of the best solutions for the future.
FERNRIDE is pioneering the use of autonomous, electric trucking within logistics centers, production facilities, and intermodal & maritime terminals, enabling its customers to immediately and significantly improve productivity, sustainability, and worker safety. Employing a human-assisted autonomy approach that allows teleoperators to control trucks remotely, FERNRIDE’s technology has been seamlessly integrated into logistics operations in ports and terminals run by industry titans such as Volkswagen, HHLA, and DB Schenker. Go to fernride.com to discover more.
In a collaborative e ff ort, BM Bergmann Marine and the Fraunhofer Center for Maritime Logistics and Services CML have conducted an extensive study on autonomous maritime systems (AMS) on behalf of the German Maritime Center DMZ. This research provides a detailed exploration of the sector, highlighting technological advancements, regulatory progress, and insights from European stakeholders. Through a methodical, in-depth survey, the study assesses relevant research & development activities and the current adoption landscape of AMS, identifies potential growth areas, and outlines the challenges facing the industry. Among the findings, di fferent sources of uncertainty are detected as the main barriers to market entry, revealing critical hurdles that the industry must overcome to fully embrace the potential of AMS.
The maritime industry is on the cusp of a significant transformation driven by digitalisation, automation, and sustainability efforts. Within this context, AMS stands out as a critical innovation with the potential to enhance operational efficiency, reduce human error, and contribute to environmental sustainability. However, the path to AMS integration is full of challenges, including technical complexities, regulatory uncertainties, and market readiness. The study analysis, evaluation, and outlook of the future market for AMS was designed to shed light on these aspects, providing a basis for informed decision-making among industry stakeholders.
To paint an accurate picture
The design of the study was methodically structured to capture a comprehensive view of the AMS landscape through a multi-faceted approach combining quantitative and qualitative research methods. A key component was a detailed survey distributed to a broad spectrum of European maritime stakeholders. This investigation aimed to gauge current levels of AMS adoption, identify technological and regulatory challenges, and understand market perceptions and barriers to entry. The study also incorporated expert interviews and scenario analysis to complement the survey data, providing deeper insights into specific industry challenges and future market potentials.
This mixed-methods approach allowed for a robust analysis of the AMS sector, offering a well-rounded perspective on the opportunities and challenges that lie ahead for the integration of autonomous technologies in maritime operations.
Stakeholders from di fferent segments of the European maritime industry were asked to participate in the study, including representatives from shipping companies, port authorities, shipbuilders, technology providers, offshore operators and hinterland logistics providers, as well as regulatory agencies and academic experts specialising in maritime studies and autonomous systems. This selection aimed to encompass a wide range of perspectives on AMS, from those developing the technology to the ones tasked with its implementation and oversight. Efforts were made to include participants representing various sizes of organisations (from large multinational corporations to small- and medium-sized enterprises) to capture a broad spectrum of experiences and viewpoints. The diversity in participant selection was instrumental in painting an accurate picture of the AMS landscape.
The demographic profile of the survey’s 52 participants highlighted a primarily German representation (61%), with a varied presence from other European countries, ensuring a broad insight base into AMS. Positions of respondents ranged from executive to technical and research roles, indicating a broad spectrum of industry
perspectives. However, the survey, while comprehensive, faced limitations, particularly in the uneven levels of participation across different maritime segments. Notably, hinterland logistics and offshore showed comparably lower participation. This disparity in engagement levels across segments suggests that while some areas of the maritime industry are actively exploring AMS, others may still be in the nascent stages of consideration or adoption.
With the above in mind, the study applies the di ff usion theory to analyse the adoption of AMS across di fferent maritime segments. This theoretical framework allows for an examination of how innovations spread within a social system over time. According to the theory, innovations are adopted in a sequential manner by di fferent adopter categories: innovators, early adopters, early majority, late majority, and laggards.
In the context of AMS, shipping, suppliers, and ports emerged as segments showing higher levels of activity and engagement, indicative of being in the early adopters or early majority phase. These groups exhibit a proactive approach to exploring and integrating AMS technologies, driven by the potential operational and environmental benefits.
Conversely, shipbuilding, offshore operations, and hinterland logistics were identified as segments with lower levels of AMS
engagement. These areas are possibly in the innovators or early adopters phase, where AMS technologies are still being explored, and widespread adoption has not yet occurred. The challenges in these segments are more pronounced, with significant barriers related to technical feasibility, regulatory clarity, and market acceptance.
The prospects and potentials of AMS, as identified through the survey, highlight the industry’s optimistic view of AMS as a transformative force in the maritime sector. Stakeholders across various segments anticipate AMS solutions comprising up to 20% of their operations within the next decade, with some sectors (like suppliers and ports) forecasting even greater adoption.
This positive outlook is driven by the anticipated benefits of AMS, including enhanced safety, increased operational efficiency, and significant cost savings. Particularly as the technology matures, stakeholders expect these gains to become more pronounced, underscoring AMS’ potential to revolutionise maritime logistics, enhance environmental sustainability, and bolster safety measures across diverse maritime operations. The widespread engagement in research and development projects further illustrates the industry’s commitment to exploring AMS’ capabilities and integrating them into future operational frameworks.
At the same time, the challenges and weaknesses with regard to AMS adoption,
derived from the survey results, are centred around both internal and external hurdles faced by industry players. Key among these challenges is the ubiquitous issue of regulatory uncertainty, cited across multiple segments as a significant barrier to AMS adoption. The lack of clear regulations and standards introduces a degree of risk and directly hampers investment and development efforts.
Internally, the industry grapples with questions of technological readiness, societal acceptance, and the integration of AMS within existing operational and logistical frameworks. However, most of these issues can be circled back to regulatory uncertainty as well. External challenges such as safety concerns, behaviour in unpredictable emergency situations, and integration with existing maritime traffic handled by people further compound the difficulties.
Moreover, the capital intensity required for AMS development and implementation, coupled with a shortage of qualified professionals and a perception of insufficient support programmes, poses substantial challenges. These barriers highlight the need for a concerted effort to address regulatory gaps, societal concerns, and technological challenges to fully unlock AMS’ potential to enhance maritime operations.
Based on these results, the study puts forth strategic policy & administrative recommendations for the maritime industry (mainly in the German context, given the surveyees’ dominant origin) to facilitate market adoption of AMS in the face of the identified potentials and challenges.
As the overarching goal needs to be the reduction of uncertainty in the market, initiatives such as establishing a national AMS mirror group for standardisation and bolstering AMS-focused educational programmes are recommended to mitigate regulatory uncertainties and bridge the skill gap.
Furthermore, the study suggests segment-specific strategies, including regulatory sandboxes for AMS testing, centralised approval points for AMS projects, and a ‘Ready4MASS’ (autonomous shipping) investment programme to stimulate initial market traction. Cross-sector dialogues are recommended to elevate AMS awareness and synchronise strategies across the maritime value chain, ensuring a cohesive approach towards overcoming technical and regulatory barriers while leveraging the inherent benefits of AMS for improved safety, efficiency, and cost-e ff ectiveness.
The Fraunhofer Center for Maritime Logistics and Services CML develops and optimises processes and systems along the maritime supply chain. Through practically oriented research projects, CML supports public and private sector clients involved in port operations, logistics, and shipping. Visit cml.fraunhofer.de/en for more details. The German Maritime Center published the full study in the fall of 2023 (go here for the English Management Summary).
International shipping, which carries over 80% of the world merchandise trade by volume, accounts for approximately 3% of total greenhouse gas (GHG) emissions worldwide. While this contribution may not be the largest relative to other sectors, the growing global consciousness surrounding environmental issues has thrust the shipping industry into the forefront of discussions on decarbonization and environmental responsibility. Consequently, new emission reporting requirements and regulations are emerging, reshaping the landscape for stakeholders within the domain.
Let us then delve into the challenges faced by the stakeholders from across the global shipping domain and explore the opportunities that arise for those who can differentiate themselves by having precise carbon emission data on hand.
That 3% figure might sound like a small impact, but it is not. Governments, industry bodies, and consumers are calling for businesses to take action and push the seaborne cargo transportation sector’s decarbonization to lower levels.
In response to these pressures, along with a personal recognition of the need for sustainable practices to safeguard our planet for future generations, shippers started gradually migrating to the camp of environmentally conscious logistics service buyers.
Some cargo owners are already actively seeking logistics service providers (LSPs) that go beyond industry-standard estimations and offer actual emission data for their freight. As a result, the common industry practice of relying on historical or generic data to calculate cargo carbon footprints will no longer suffice.
This marks a significant shift from the industry’s traditional, outdated practices to a higher standard of using actual CO2 emission data. Only by taking this new approach
can shippers accurately assess the true environmental impact of their supply chain and transportation activities.
That said, shippers must not undertake the journey towards decarbonization alone. The process requires collaboration across the entire domain, from carriers to LSPs and even logistics technology (LogTech) providers, who often play a critical role in connecting the stakeholders mentioned above.
The path is clear
The future of the shipping industry hinges on the collective efforts of all players involved, as they are dependent on each other. However, each party has its own challenges and opportunities regarding emission report data.
Because more and more shippers want to use actual CO2 emission data to accurately assess the true environmental impact they make on global GHG levels, it’s paramount for them to look toward business partners such as carriers, LSPs, and LogTech solutions that align with the latest trends and regulatory demands, providing the data that cargo owners need. Admittedly, achieving this goal requires time and dedication – and perhaps dramatic changes in case the current business partners or software do not match the new requirements. Nevertheless, the path forward is clear and straightforward.
Navigating this transition is undeniably more intricate for the LSP segment. Relying on industry averages and calculations is no longer tenable. To distinguish themselves as frontrunners in terms of implanting environmentally responsible practices, LSPs have two options: get emission data from modern LogTech solutions (like transportation management systems and visibility/ booking platforms) or directly from carriers.
While leveraging innovative solutions to uphold accuracy and transparency in emission reporting sounds like the easiest option, this approach entails a heightened responsibility in terms of data provision. As a rule, data obtained through these avenues is accurate but still perceived as another estimation if the solution provider does not directly receive CO2 data from carriers. Consequently, providing this data to the shippers creates additional unwanted responsibility for LSPs.
In contrast, carriers with ship fleets hold all the requisite information to conduct precise calculations and furnish the data to their partners. As a result, the most reliable method to acquire 100% accurate information is to request it from asset-owning carriers – the party that is sitting in the driver’s seat in this regard.
However, not all carriers share this information by default, and those who do share it do so in a way that is convenient
for them. As there is no such thing as an industry-standard data-transfer protocol or data format for emission-related data, businesses will have to deal with anything from an Excel sheet sent via email to a devoted message sent via API or EDI, depending on how sophisticated the carrier’s IT capabilities are. To obtain a full picture of the workload one might face when working with carriers, multiply the received emission report by the number of carriers you work with and the freight volume you expect to move with them.
LogTech solution providers are another stakeholder group that might benefit from this shift. They, depending on the situation, can provide solutions for any of the aforementioned parties. For the business they’re active in, this industry-wide change could be a great chance to stand out from the crowd, but – again! – only if they can provide actual CO2 emissions data. This is because the market is currently saturated with countless solutions that offer artificial intelligence-powered calculations and industry average indexes. The challenge here is the same as for LSPs – obtaining actual CO2 emission data from carriers. The only difference is that the process will be more complex and resource-intensive, as it’s necessary to be able to build connectivity with
any existing carrier to satisfy customers who might want to work with parties that are not yet part of the ecosystem.
The shift towards sustainability, while presenting new opportunities, also places a significant burden on industry stakeholders, demanding sufficient resources and knowledge to keep pace with these changes.
In response to these challenges, businesses are turning to innovative solutions like Youredi’s Carrier Emission Report Connectivity service. This comprehensive solution, designed to enhance emission reporting capabilities, offers actual data from carriers, enabling companies to accurately assess their environmental impact and stay ahead of regulatory requirements.
Leveraging this service emerges as a strategic imperative for businesses seeking growth in a market in which environmental responsibility is non-negotiable. By adopting this solution, whether as a shipper, freight forwarder, or LogTech solution provider, you
can ensure a bright and sustainable future for your organisation.
As a part of the international shipping domain, it’s crucial to remember that overcoming the CO2 emission data challenge is not just about staying on top of industry trends but about leading the charge toward genuine environmental accountability. By embracing solutions such as Youredi’s, one can set their business apart as the go-to choice for companies that are committed to sustainability while making a meaningful impact in shaping a greener future for the industry.
With new emission reporting requirements on the horizon, shippers are gravitating towards environmentally conscious business partners who provide more accurate data and go beyond industry-standard estimations. For organisations aiming to grow in a market where environmental responsibility is a core value, embracing this shift is no longer a choice as much as a strategic imperative.
For the past decade, Youredi has been developing integration services for the global markets. Today, the company is one of the leading service providers in supply chain and logistics integrations. Numerous leading shippers, carriers, and data providers have trusted Youredi to deliver their most valuable data flows to run through Youredi’s iPaaS. Head to youredi.com to find out more.
The Polish full-rigged sailing ship Dar Pomorza (Gift of Pomerania), functioning in Gdynia as a museum since 1983, is hosting an exhibition till end-November 2024 devoted to the various animals that inhabited her deck, rigs, cabins, and holds for nearly 100 years (the 1909-built frigate joined the Polish fleet in mid-1930). It paints a colourful history – often very exotic in the interwar period, though not without bitter moments here & there – clearly delineated by how the world changed after 1945.
The period leading to WWII saw Dar Pomorza embarking on transoceanic voyages – also carrying scientific expeditions on two occasions during which thousands of specimens were collected, including for the Warsaw Zoological Garden. Those escapades brought on board venomous snakes, parrots, monkeys, turtles, coatis, flamingos, and even a panther (!), not to mention 600 jars with river and sea plankton. Some of the animals were captured by sailors and officers themselves, probably to bring back home creatures known only from books.
The life of these animals on Dar Pomorza wasn’t easy as the ship wasn’t built as an expedition vessel nor fitted to act as one. As such, the animals were placed haphazardly, oftentimes without proper accommodation. The salt from seawater damaged their feet, while, e.g., monkeys suffered from sea sickness. The threat of going overboard was ever-present. But as the crew got accustomed to their furry & feathered passengers, the care-taking conditions also luckily changed for the better.
The two mentioned scientific expeditions – to Brazil and Angola – took place in 1931-32 and 1933-34. When in the Brazilian City of Paranaguá (Great Round Sea) at the break of 1931 and 32, the researchers paddled upstream and discovered a new species of boat bug. Examined carefully by Tadeusz Jaczewski, the little thing received the Latin name of Trichocorixa dar-pomorza. The ship’s crew supported the scientists in their exploits, although they found some of them a bit peculiar, like collecting shark parasites.
In 1934, Dar Pomorza was in the Angolan Port of Lobito. The crew paid a visit to the Boa Serra plantation near the town of Huambo, managed by a Polish couple: Maria and Michał Zamoyski. The scientists gathered research material, while the crew received a ten-monthold panther from Maria and Michał... The animal was a gift for the zoological garden in Warsaw. The large cat, named Cleopatra in recognition of the grandness she displayed, was domesticated and quickly won the sailors’ hearts (though she was keen on tearing their pants and biting the trouser legs with her razor-sharp claws and
needle-piercing fangs). The panther was also on good terms with a coati, having no quarrel with him when it came to mapping out each other’s area on Dar Pomorza (Cleo even let the coati eat from her bowl!). Upon arrival in Gdynia, the panther was transported to Warsaw.
By the way, coatis on board Dar Pomorza were a topic in and of itself. These animals weren’t accustomed to confined spaces, which resulted in them wreaking havoc (somehow, tearing pages from books was one of their favourite free-time pursuits). Once Miś, one of the interwar coatis, kicked a tin can full of fish oil that landed on the freshly cleaned deck. Another time, he tipped over a can with anti-corrosive paint. Covered
in it, all-red-dripping Miś was more than happy to crisscross the justwashed blankets and bed linen... In spite of such mishaps, coatis were the crew’s favourites: they liked to be cuddled and often dozed off on sailors’ laps. Two coatis, Miś-Tryc and Misk-Miś, made it ashore in the course of time, finding shelter in zoological gardens.
The 1934-35 round-the-world voyage also witnessed a lot of animals boarding Dar Pomorza. It all started while the ship was still in Europe with the purchase of a monkey on Tenerife (for the price of white trousers, a shirt, a hat, a pair of low shoes and socks, and one shilling). As the trip continued, more and more animals became part of the crew, the bulk of them when Dar Pomorza was on the Galápagos Islands: two large and nine small turtles, two young pelicans and a flamingo. In Australia, in the Port of Broome, the Captain bought four parrots. More birds of the same species were taken in while on Java, together with two monkeys, a cat, and an ichneumon. At some point, the need to appoint a ‘studentzoologist’ for every watch arose, who was in charge of taking care of the animals (including feeding and cleaning thereafter).
Unfortunately, living on a sailing ship was unbearable for some of the animals. The flamingo passed away after a couple of weeks, one of the pelicans went overboard, two parrots from Australia also died, and the monkey Moniek, who travelled with the crew for the larger part of the journey, checked out one month before Dar Pomorza landed in Gdynia.
Other animals made it safely, including a boa constrictor bought by the ship doctor for his wife! Interestingly, the snake was at first locked in a cage, but after some time, the animal was released and could sleep on a bunk (more specifically, wrapped around the bedspring). Records speak of a coati, a didelphis, turtles, and a cougar making it to the Warsaw Zoological Garden. One parrot and a coati found shelter in a similar menagerie in Pelplin. Parrots and monkeys usually stayed with the families of the sailors.
Sadly, certain animals – chiefly seals and sharks (including pregnant ones whose unborn ones were fed to the pelicans; the same fate was dealt to flying fish) as well as Galápagos turtles – weren’t even given the slightest chance to make it alive when Dar Pomorza entered their territories. Some of the officers carried hunting rifles and didn’t shy away from using them. Apart from the animals mentioned above, three kangaroos in Australia and a deer on Mauritius also fell prey to the fiery lead. Some other day, students organised a turtle race, but fortunately, that
was only a one-time thing (in the 1970s, someone carved horses out of wood from that time used as racing figures).
Speaking of turtles, after WWII, Dar Pomorza ceased embarking on such grandiose voyages. Instead, she mainly plied in the Baltic, seldom in the Mediterranean, and only on special occasions did she visit the Red Sea. Consequently, there were no opportunities to catch exotic animals. With one exception, that is. In May 1963, en route from Piraeus to Naples, Dar Pomorza spotted turtles passing by the ship. One of the crew members jumped and caught six animals. They were placed in a ‘pool’ made of sailcloth (originally used for bathing by the students). The turtles were to be transferred to the Gdańsk Zoological Garden but eventually stayed with the National Marine Fisheries Research Institute in Gdynia.
Also in 1963, a legend was born: the dog Miś (Teddy Bear), transferred, so to speak, from Zawisza Czarny (the 1952-built-as-afishing-boat-1961-turned-yacht belonging to the Polish Scouting and Guiding Association). Back then, Misiek was but a tyke, fooling around with the cats from the Lady Walewska clan (see Rats & cats). He was most often seen on deck or in the mess eating his favourite candies or fermented cucumbers (or under the captain’s living quarters, where it rocked the least during a storm). Miś wasn’t a landlubber. While berthed, he disembarked Dar Pomorza to mark the nearest bollard or tree and quickly got back on deck to guard the gangway. Then again, he also wasn’t especially fond of waves, barking at them doggedly (including by sticking his head through a fairlead, most probably to have, I suppose, a better barking position). On the other hand, Misiek was a true fan of sails. He was hurrying with the rest of the crew when it was time to make sails, accompanying the chief mate when he shouted the instructions. The dog was very disappointed when it came to kick-starting Dar Pomorza ’s engine. Miś performed his
duties (among others, ringing the bell for watch change) till finally, rheumatism got the better of him. Miś went ashore in the spring of 1976. He passed away in the autumn of the same year in an animal shelter in Gdynia. But back in his under-sail years, Misiek became a bit of a celebrity. Starting from 1967, there was a series of articles about him. He even made it on a book cover (a collection of essays about animals by Leszek Prorok) and likewise acted as a cunning painting portrait model (two paintings by A. Gozdawa-Strzyżowski)! The last one shouldn’t come as a surprise: the crew sewed him a genuine sailor’s jacket and a cap with boatswain’s insignia in which he looked like one fine handsome devil (though making him wear pants wasn’t the best idea, particularly when Miś decided it was time to pump ship…).
There was one animal which Dar Pomorza didn’t want to see on her board: rats. Several measures were used to either get rid of them or prevent their intrusion in the first place. Regarding the latter, rat guards had to be installed on mooring lines. According to regulations, these were to prevent the rodents from going ashore. The crew saw it the other way around: to make it difficult for rats to break into the food storage located on Dar Pomorza ’s bow. Before sailing out of Gdynia, the ship had to undergo rodent extermination, which meant gassing the unwelcome stowaways. And, naturally, Dar Pomorza was also home to cats – but not those fluffy ones from modern commercials that get their meals straight outta lush-looking cans and served on a shining platter. The seafaring feline killers had to hunt down their food! Two cats made history here: Lady Walewska and Fela. The former (together with Peggy, Blacky, and Buc) joined Dar Pomorza in the autumn of 1946 while the ship was berthed in Portsmouth. And boy, did the crew admire her hunting skills! In the
1950s, Lady Walewska went ashore in Gdańsk and didn’t turn up when the vessel was clawing away. Fast forward one year, and she greeted Dar Pomorza when the ship was back in Poland! Her behaviour was somewhat peculiar, though, as if she wanted to show the crew something. The ship’s electrician followed her to the shipyard, where he discovered a few still blind newborn kittens. The whole gang was adopted, and Dar Pomorza could continue sailing with her fiercest rat hunter. She sailed till the mid-1960s when the dog Miś boarded the vessel. At first, the feline-canine relations were correct, but then Misiek worried a stray cat, and the so-called Walewska Clan decided it was high time to evacuate. When the dog departed for the eternal watch, there were no other animals that occupied Dar Pomorza for a longer
period. That changed when the coronavirus pandemic hit the fan. Before COVID-19, Fela lived on the Southern Pier in Gdynia, which had a rich array of bars and restaurants. When these establishments had to close their doors due to the hard lockdown, the cat reevaluated her options and decided she could very well become a sailor. The pandemic is no more, but Fela has grown a liking for living at sea. She can be seen prowling Dar Pomorza, most notably the ship’s kitchen and shop, but above all, Fela likes to spend her time on a hammock
in the student quarters. Naturally, there were other cats on board Dar Pomorza, mainly during the interbellum, but their names got sunk in the waves of history. That said, the exhibition managed to surface two anecdotes. First, when a domestic cat saw another feline aboard the ship, a leopard, to be precise, experiencing a shock at the sight. The second story also involves a shock, but this time, when another cat heard the performance of the newly-formed musical band of Dar Pomorza and had to hide in the farthest corner of the ship.
… and other ‘animals’ on board Dar Pomorza
The exhibition also brings forth parts of the ship or its equipment named after animals. “Cows” are the two lifeboats positioned on the main deck. “Lambs” refer to wooden round elements placed inside metal rings, e.g., to lessen the tearing friction when pulling ropes. A “piglet” denotes ballast cubes. “Hedgehogs” or “kittens” are protective covers made of old ropes and placed where rigging could tear the sails. “Fireflies” are glass upper works through which
light can get into those parts of the ship without portholes (or with too few of them). There is, of course, the “dog watch.” Dar Pomorza, however, misses a crow’s nest (“stork’s nest” in Polish), a structure specific for smaller units. The masts of the vessel are 40-metre-tall, meaning that no warning could be heard from such a distance.
Dar Pomorza has, instead, “eyes,” two small bridges situated on the foredeck.
ANDREAS ANDERSSON CEO, Mälarhamnar
The Swedish ports in Köping and Västerås have a new Chief Exec, who most recently worked as Head of Maritime Service and Security at Copenhagen Malmö Port. Earlier, Andersson, a BSc Master Mariner from the Chalmers University of Technology, was with the Port of Trelleborg in the role of Head of Security. He also worked for almost 16 years for the Swedish Maritime Administration, among others, as Research & Innovations Partner and Project Manager.
THOMAS BAY JENSEN
COO, the Port of Rønne
Jensen joins the Danish island seaport from the position of Head of Strategic HR at VKST and CEO of Bornholm’s Agriculture & Food Council, where he spent the past eight years. He was also a Board Member of Agro Reinsurance and Agro Holding while also sitting at the board of Rønne Vand & Varme (a water & heat utility company). Jensen, a high-ranking member of the Danish Navy, was also Commanding Officer at Maritime Surveillance Centre South – Bornholm.
ELISE NASSAR
Member of the Management Board, Tallink Grupp
Nassar, who holds a bachelor’s degree in law from the University of Tartu, joined the company in 2018 as Data Protection Officer. In 2019, she was appointed to lead the Internal Audit Department. Since the summer of 2022, Nassar has been Group Head of Legal and Head of the Internal Audit and Internal Control departments. Nassar is also a Member of the Board of Directors of the European Community Shipowners’ Associations and President of the Estonian Shipowners’ Association.
JAROSŁAW SIERGIEJ
CEO, the Port of Szczecin-Świnoujście
Siergiej – among others, a PhD in Economics from the University of Szczecin, a Doctor of Business Administration from the Polish Academy of Sciences, and an MBA holder from the University of Illinois at Urbana Campaign – is back behind the steering wheel of the Polish ports, which he previously led in 2008-2013. After that, he was General Director of Polferries, Managing Director at Traffic Equipment, and lately, Senior Technical Director with West Pomeranian Waterworks.
PIOTR GORZEŃSKI
CEO, the Port of Gdynia
Gorzeński, holding a Master’s in Shipping & Navigation and an MBA from the University of Gdańsk, comes to the new post from the Polish Ocean Lines, where he was Director of Strategy and Development. Earlier, Gorzeński worked as, among others, Logistics Director at Remontowa Lighting Technologies and PGZ Naval Shipyard, Logistics Executive Director with PKN ORLEN, as well as a Board Member at its Lithuanian subsidiary, ORLEN Lietuva.
JARNO KURTTI
Sales Manager, WALLENIUS SOL
Kurtti, an alumnus of the Business College of Oulu and Environmental School of Finland, moved to the Swedish shipping line from DHL Global Forwarding, where he worked for nearly 18 years (most recently as Key Account Manager). Kurtti will be based at the newly opened WALLENIUS SOL’s office in Oulu, working with clients across the whole of the Nordic region. Outside the realm of sales and logistics, Kurtti enjoys the great outdoors through skiing, cycling, and snowmobiling.
DOROTA PYĆ
CEO, the Port of Gdańsk
Professor Pyć, who heads the University of Gdańsk’s Department of Maritime Law, is no stranger to the Polish seaport, having been a Member of its Board since 2019 on behalf of the City of Gdańsk. She also worked for the country’s cabinet as Undersecretary of State in the then Ministry of Transport, Construction and Maritime Economy and afterwards in the Ministry of Infrastructure and Development till 2015. Her rich scientific career includes founding the Fahrenheit Universities Women’s Club.
OLE TRUMPFHELLER
VP & MD North Europe Continent, Maersk
Trumpfheller comes from the position of Head of Global Operations – Contract Logistics & SCM at DB Schenker. Earlier, he worked for over 12 years with DHL Supply Chain, starting in Business Development for Central Europe and finishing as Managing Director, Europe – DHL Lead Logistics Partner. Trumpfheller, a BSc in Business Administration and Marketing, an MSc in Economic & Foreign Trade and Logistics & Supply Chain Management, recently completed an Executive Leadership Programme by Oxford Saïd.
Be sure to take part in the world’s biggest and most important business platform for the onshore and offshore wind industry!
Be sure to take part in the world’s biggest and most important business platform for the onshore and offshore wind industry!
• Meet up with 1,500 exhibiting companies from 40 countries across 10 halls
• Meet up with 1,500 exhibiting companies from 40 countries across 10 halls
• Get i n touch with the key decision makers of the international wind energy sector
• Get i n touch with the key decision makers of the international wind energy sector
• Visit the first-rate conference programme on 4 stages in the halls free of charge
• Visit the first-rate conference programme on 4 stages in the halls free of charge
• Two days dedicated to recruiting – for career starters, specialists and career changers
• Two days dedicated to recruiting – for career starters, specialists and career changers
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