94% of Supply Chain professionals rate green issues as a business priority. The international shipping is already, by far, the most carbon efficient mode of commercial transport. But it is fully recognised that CO2 emissions from the industry as a whole (appr. 3% of global emissions) are comparable to those of a major national economy. With that being said, is green shipping really being prioritized in our industry?
At this point in time companies realize that the green path is a profitable one, so they’re pushing suppliers to operate leaner, better, and smarter. The truth is that there is no single, revolutionary new idea that is going to turn the shipping industry green. But industry players are looking to a mix of technical tweaks and smarter steaming to accumulate enough modest energy savings to add up to something really substantial.
The Danish shipping line Maersk adapted this strategy early on, and plans to cut its carbon emissions by 25% by 2020, mostly by retrofitting its current fleet and by using it more energy efficiently. Slow steaming saves money, saves carbon, and also gives clients a more reliable date of arrival. Basically meaning; reducing operational costs for steamship lines, saving the environment and improving service for the shippers – a win-win-win result. Cost-cutting will be a major driver of change. Pressure from carbon-conscious major shippers, such as Walmart and Ikea, looking at greening their supply chain, will also help in the carbon emissions reduction.
The global shipping industry has saved large amounts of fuel costs and CO2, because the industry, according to a recent survey conducted by Bloomberg and Clarkson, has reduced speed by 27% since 2008. Even when the world economy gets back on its feet, it is not likely that the speed will be turned up.
Maersk Line, in the forefront of change, has found that the optimum speed for most of the company’s container ships is 15-20 knots, and not the 20-25 knots that was typically sailed in the past. The 20% speed reduction saves 40% in fuel – with matching reductions in carbon dioxide emissions. 40%!!
“We have finally ditched the old paradigm of just having to be faster and faster. This is better both for the bottom line and the environment,” says Climate and Environment Manager at Maersk Line, Jacob Sterling to Politiken, a Danish newspaper.
According to Mira Asset Securities and other industry analyst this slowsteaming strategy is the biggest change in the shipping industry since the Second World War.
Maersk is not the only carrier that deserves praise in their sustainability efforts, Hamburg Sued and others are joining together in organizations like the
Clean Cargo Working Group, to address the sustainability of logistics. CSX and DB Schenker started offering carbon footprint calculators on their websites.
Shipping companies have a very strong incentive to reduce their fuel consumption and thus reduce their CO2 emissions. The consensus of opinion within the global industry is that it may be possible for shipping to reduce CO2 emissions by 15-20% between 2007 and 2020, through a combination of technological and operational developments, as well as the introduction of new and bigger ships, designed to the new International Maritime Organization (IMO) Energy Efficiency Design Index. This is a significant challenge given that there have already been substantial improvements in the efficiency of ships’ engines.
In a highly energy efficient industry major changes are not realistic.However additional improvements to hull, engine and propeller design are expected to produce further reductions in fuel consumption. There may also be possibilities for the better utilisation of waste heat. In the longer term, however, the shipping industry is also exploring a number of alternative fuel sources to help reduce CO2 emissions.
Renewable energy sources such as wind and solar power are not practical for providing sufficient power to operate ships’ main engines – the huge physical size of ships should not be underestimated. But they may have their place in helping to meet some ancillary requirements, such as lighting on board ships. Every small step taken towards sustainability will lessen the carbon footprint of the entire industry as a whole. When market leaders like Maersk take the first step, others will eventually follow.
Ships will continue to burn fossil fuels for the foreseeable future, and the most significant means of reducing CO2 emissions will be achieved by further improvements in efficiency across the entire transport chain.