Charterers embarking the data ship

by Nikolay Georgiev Nihrizov, Head of Weather Advisory Services, ZeroNorth

The EU’s Emissions Trading System will likely result in shipping companies directly passing the costs on to charterers. Meeting the requirements of the International Maritime Organization’s (IMO) Carbon Intensity Indicator (CII) won’t be simple because a vessel’s ongoing emissions performance will depend on operational factors such as how fast it sails, external factors like weather and tide conditions, as well as its technical capabilities for reducing the footprint.

Arelatively low-cost and initially popular option for ship operators aiming to improve CII ratings is to introduce engine power limilargest container feeder and short sea network in Europe (including 48 ships of its Baltic fleet as of September 2022, totting up to over 628k dwt). The carrier is harnessconsumption, becoming even more critical with the transition to green fuels, which will likely see fuel bills multiply many times over the coming decades. tation systems and slow steam their vessels on favourable routes. CII requirements will tighten over time, so this is a short-term solution only; yet, it could still have significant and immediate consequences for the commercial interests of charterers and the negotiation of charterparty agreements.

Due to the upcoming IMO and EU regulations, shipowners and charterers will certainly face new commercial challenges. They will need to find a way to meet targets and stay compliant without the bottom line suffering.

Tech that drives the green agenda

Ship operators have already started collecting the data in preparation for what the IMO will require to calculate CII ratings. Some operators are now using those data to accelerate their decarbonisation efforts. Take, for example, Unifeeder, having the ing digital technology from ZeroNorth to provide its fleet managers with full transparency over voyage planning, optimising the journeys through integrated weather routing, as well as bunker, vessel and emissions optimisation recommendations that help them unlock fuel efficiencies, reduce carbon emissions, monitor CII ratings, and improve earnings. Adopting digital technologies that enable organisations to advance their green agenda is critical in reducing local and global emissions. The transparency gained through data-driven insights empowers individuals and teams to recognise and act on untapped potential efficiencies. In fact, ZeroNorth believes there could still be around 10% of latent performance improvements ready to be unlocked through more optimal voyages, likewise improved vessels and bunker utilisation. This will further lower fuel

‘Fair-weather’ assumptions

Charterers can continue, as they have always done, to rely on fuel consumption tables when deciding which vessels to charter. Alternatively, they, too, can take advantage of today’s more mature data landscape to accurately predict vessel performance. The fuel consumption estimates historically used for making pre-chartering decisions are often based on limited operational data, such as selected speeds and good weather, rather than the dynamic range of situations faced at sea. This creates a challenge for charterers wanting to identify the best-suited vessel for a particular journey. Shipowners may introduce energy efficiency improvements. That said, without actual performance data to prove the effectiveness of such initiatives in reducing fuel costs, charterers are still left making

Photo: Unifeeder

‘fair-weather’ assumptions based on limited operational experience and equipment manufacturer claims.

The technology already exists to support more accurate and dynamic fuel consumption predictions via modelling the complex conditions that vessels face while at sea. Sophisticated algorithms and machine learning can process millions of data points (including weather, ship characteristics, and operational and historical performance) to accurately predict how much fuel will be needed for a given voyage if a particular vessel is to be selected. This equips charterers with the data they need to make smarter, more informed pre-chartering decisions and select the most suitable ship for the specific route and conditions.

For the first time, the same data set can inform pre-chartering and operational decisions, thus enabling a more holistic approach to decarbonising global trade.

Trust in data integrity

An often-overlooked benefit of digitalisation is that it enables individual development, intra-team accountability, and wider collaboration with other stakeholders. However, this does require trust in the integrity of the data being captured and used to generate predictions and recommendations.

For example, noon reports have historically been time-consuming for crews, and it is widely accepted that data quality improvements are needed. Having a shared data standard would generate time efficiencies across the supply chain, cutting down the requirement for crews to deliver multiple reports to different stakeholders.

Earlier this year, the industry working group Impact Today – consisting of 14 organisations, including ZeroNorth, EuroNav, FedNav, Q88, Ultrabulk, Teekay Tankers, and Siglar Carbon – created a new standard for noon reporting to improve data quality, decarbonisation efforts, and match data gathering with the industry’s optimisation needs.

Impact Today has also called for creating a methodology for assessing fuel performance model accuracy. These models, like the data fed into them, are vital to ensuring that optimisation decisions are based on the actual conditions a vessel faces while sailing.

Data quality is a critical factor in underpinning voyage, vessel, bunker and emissions optimisations for vessels in the global fleet. To ensure reliable, useful output from any digital platform, it is critical that the data inputted across the supply chain is highquality, standardised, and interoperable.

Evolving digital technologies will enable the industry to unlock even better voyage and vessel optimisation outcomes, paving the way for broader collaboration and greater transparency as lenders also evaluate performance and CII ratings before offering ship-related finance.

Looking beyond CO2 emissions – positively

In the longer-term, digitalisation builds a framework for meeting new challenges. Some of the EU’s regulations for the decarbonisation of shipping are yet to be finalised, but the need for extending beyond carbon dioxide emissions to methane and nitrous oxides has already been voiced. The IMO is under similar pressure, particularly as the shipping industry evaluates the true well-towake emissions of new fuels such as methanol, ammonia, and hydrogen.

Digital solutions provide the shipping industry with a positive vision of the future and the ability to take immediate action to reduce emissions and improve performance today rather than some vague, unknown time in the future. ‚

Born from Maersk Tankers, ZeroNorth was founded to change the shipping industry through digitalisation. Working alongside our customers and partners, we truly believe that we can support shipping companies worldwide to optimise their business while reducing shipping climate footprint. This is what empowers us, a team made up of some of the most creative and strategic minds in shipping, with over 90 years of experience in the industry. Set a course for zeronorth.com to discover more.