To achieve this, the CEOs believed the maritime industry should accelerate both technological and business model innovation, further improve operational and technical energy efficiency, plus a transition to zero-carbon fuels and new propulsion systems.
They supported the scientific rationale for urgent action presented by the Intergovernmental Panel on Climate Change and the IMO’s greenhouse gas studies. Together, they emphasised the need to meet the temperature goals of the Paris Agreement and for the maritime industry to phase out greenhouse gas emissions, as soon as possible.
A shift to a low-carbon economy by 2050 has the potential to create new opportunities for business through both technological and business model innovation, they said. The shipping industry must rise to the biggest technology challenge in 100 years, and regulations should provide long-term certainty for financiers, builders, owners and charterers to make the required investments in low-carbon technologies.
The CEOs also accepted the need for transparency to help drive the change.
Emissions reduction objectives should be met at the lowest possible cost, and the acceleration to the use of low-carbon technologies and fuels will require significant funding flows for research and development. The industry should explore the use of carbon pricing and other mechanisms that can create economic value from greenhouse gas emission reductions, they said.
In addition, the maritime industry’s greenhouse gas reductions should be in line with the temperature goals of the Paris Agreement. This will require absolute reductions in carbon emissions to accommodate the expected growth in global trade. Research from Lloyd’s Register and University Maritime Advisory Services indicated that there is no time to waste.
“An ambitious strategy consistent with the Paris Agreement temperature goals will require zero emission vessels to be entering the fleet in 2030 and form a significant proportion of newbuilds from then on. Different solutions have different benefits for different types of ships, it is important that solutions are not only viable from a commercial perspective but are also technically feasible and can be safely adopted and operated,” explained Alastair Marsh, LR CEO.
The initial greenhouse gas strategy adopted by the IMO in April, 2018 constituted a crucial step on the long road towards climate-friendly seaborne trade. It has the full support of the CEO’s. They stressed that legally binding actions set by the IMO must be enforced by member countries to compel the industry to shift and they are committed to work together with the IMO to make the strategy a success.
One of the signatories, Paddy Rodgers, CEO Euronav, said: “Shipping has so far been exempt from regulations to address the issues around GHG emissions from fuels for ships but the IMO has, after consultation laid a pathway, which requires a fundamental change in the way we fuel our ships. Shipping must embrace these targets so let’s take our responsibility to make sure our industry is heading towards a sustainable future for ourselves and the next generations in line with the expectations of our global stakeholders.”
Agreeing, Jan Dieleman, President of Cargill Ocean Transportation, added: “The IMO has successfully aligned the global maritime industry with the climate change targets set in the Paris Accord. The shipping sector clearly shares a collective responsibility to transform its operations, build new technologies and infrastructure, and make sustainable shipping a reality. The industry is embracing the challenge and working side-by-side to drive progress and find solutions.”
The CEOs recommended that core principles of the ‘roadmap’ for transition to a new zero-emission future should be:
Ambitious: The Strategy should be consistently in line with the Paris agreement’s temperature goals.
Predictable: Regulations should provide long-term certainty for financiers, builders, owners and charterers to make the required investments in low-carbon technologies.
Market-oriented: Emissions reduction objectives should be met at the lowest possible cost, and the industry should explore the use of carbon pricing and other mechanisms that can create economic value from GHG emission reductions.
Technology-enabling: The Strategy should accelerate the use of low-carbon technologies and fuels by encouraging significant funding flows for research and development.
Urgent: Certain mid- and long-term measures will require work to commence prior to 2023, including the development of zero-emission fuels to enable implementation of decarbonization solutions by 2030.
Coherent: Solutions implemented should build on and reinforce existing technical, operational, and energy efficiency measures whilst maintaining or enhancing safety standards. In this context it is critical that all IMO environmental regulations be compatible with future 2050 regulations.
Enforceable: Legally binding, enforceable actions set by the IMO and enforced by member countries are required to compel the industry to shift.
Included in the initial CEOs to sign were - Claus Hemmingsen, Vice CEO, AP Moller-Maersk; Jan Bjorn Hojgaard, CEO Anglo-Eastern; Jan Dieleman, President Cargill Ocean Tranportation; John Hadjipateras, Chairman and CEO Dorian LPG; Jan Rindbo, CEO NORDEN; Euronav, Patrick Rodgers, CEO Euronav; Paul Wogan, Chairman and Member of the Board of Directors, GasLog; Scott Bergeron, CEO, Liberian Registry; Alastair Marsh, CEO LR; Yee Yang Chien, President and Group, CEO, MISC; Mats Berglund, CEO, Pacific Basin; Khalid Hashim, Managing Director, Precious Shipping; Ståle Hansen, President and CEO, Skuld; Jeremy Weir, CEO, Trafigura and Ian El-Mokadem, CEO, V.Group.
More were expected to follow, the forum said.