Environment

Shipping is the solution for an environmentally friendly economy, not the problem...

Ships transport larger volumes over longer distances, making them a more sustainable form of transportation compared to aviation or road transport. However, this doesn't mean that the shipping industry should remain idle. On the contrary, it must take action to reduce its share of greenhouse gas emissions to zero by 2050. Improving and innovating where possible is crucial to maintain the maritime industry's advantage over other modes of transportation.

For years, shipping companies and policymakers have debated the maritime industry's contribution to a sustainable economy and how to further improve its environmental impact. This debate occurs at all levels, from international (IMO) and European to national and even at the port authority level. KBRV plays a prominent role in facilitating discussions between policymakers and the industry.

How can we make shipping even more energy-efficient with the ultimate goal of becoming climate-neutral? This is the challenge.

Despite rising fuel prices in the past, encouraging shipowners to take energy-efficient measures such as slower sailing, there are still many sector-specific barriers to overcome. According to KBRV, the transition to a climate-neutral economy is an excellent opportunity for the sector because maritime transport is already highly energy-efficient, with ample room for improvement. However, it is crucial to consider what is realistic in the short and long term.

To address this, KBRV conducted studies in 2008 and 2013 on the energy performance of its ships. This project resulted in one of the most detailed databases on fuel consumption of ships worldwide, contributing to the ongoing debate within the EU and especially within the IMO on monitoring, reporting, and verifying fuel consumption. Additionally, the Maritime Industry Decarbonisation Council (MIDC) was established, a think tank bringing together stakeholders from the entire maritime value chain to share technical knowledge and gain a comprehensive perspective on the challenges they face.

Be clear and thoughtful with environmental legislation.

What shipowners and companies need most is clarity on what emissions a ship is allowed to release (in the air and water) in international and territorial waters. Only with clear regulations can informed decisions be made. Reducing emissions and implementing best practices, often ahead of regulations, becomes challenging in an environment of vague rules.

European legislation to curb ship emissions in Europe is currently in development. As part of the Fit for 55 package, the European Commission approved a cap-and-trade system for European shipping (EU ETS) and regulations related to the carbon intensity of fuels (FuelEU) in early 2023.

Given the international nature of shipping, legislation at the international level is essential to ensure a level playing field. In 2023, the IMO also took steps with its renewed strategy, setting the goal of achieving zero emissions in international shipping around 2050. This strategy requires support in the coming years through appropriate technical and economic measures. KBRV will continue to advocate for simple, thoughtful, and effective measures at the international level, such as a fuel levy.

Environment, health, and shipping go hand in hand.

The international community is concerned about the impact of sulfur and nitrogen in the air, especially in areas where busy shipping routes and ports are close to densely populated areas.

Sulfur is naturally present in liquid fuels, but combustion produces sulfur oxides (SOx). SOx leads to acidification and contributes to the formation of fine particles. To address this, the IMO set limits on sulfur content in ship fuels worldwide.

In 2005, the entire Baltic Sea was declared an Emission Control Area (ECA). The North Sea followed in 2006, and later the entire coast around the US and Canada. In ECAs, ships are only allowed to burn low-sulfur fuels with a sulfur content 90% lower than the global average.

The most significant steps so far? The 0.10% sulfur limit applied in ECAs, requiring ships to switch from heavy fuels (HFO, a refinery byproduct) to more expensive low-sulfur distillates. Moreover, starting January 1, 2020, all ships above 400GT are allowed to carry fuel with a sulfur content not exceeding 0.5%, compared to the previous limit of 3.5%.

While low-sulfur distillates offer a solution for SOx, reducing NOx emissions requires modifying the engine or installing catalysts in the exhaust. Due to incremental tightening (Tier I, II), significant progress has been made in reducing NOx emissions in recent years.

Nitrogen oxides (NOx) contribute to the formation of fine particles and are generated during combustion at high temperatures, such as in an engine. The Tier III standard sets an exceptionally ambitious goal of an 80% reduction in NOx emissions compared to the current IMO-imposed Tier II standard. However, Tier III applies only to newbuild ships and is enforced only in designated areas (NOx Emission Control Areas or NECAs). Currently, the 200 nm (nautical miles) zone around the coast of the United States is designated as an NECA. The Baltic Sea (including Russia) and the North Sea will become NECAs from January 1, 2021.

Safe and environmentally friendly ship recycling.

How can ships be dismantled safely and environmentally responsibly? The Hong Kong Convention of 2009 has established clear and relevant requirements for shipowners, shipyards, and all other involved IMO parties (governments). This convention was ratified to take effect from 2025.

At the European level, a European regulation dictates how ships should be dismantled. While the European regulation is based on the technical standards of the Hong Kong Convention, it goes further by including additional requirements for recycling facilities and proposing a European list of approved recycling facilities. The most controversial aspect of the regulation is the publication of an EU-recognized list of recycling facilities where ships under the European flag must be dismantled. The EU should not ban shipyards outside Europe but rather guide and incentivize them to improve their standards in the coming years. The European Union must expedite the implementation of the Hong Kong Convention, which is its primary objective, according to KBRV.