Accelerating towards green shipping in Singapore and beyond

Sustainability in the maritime industry has matured in the last couple of years, with solutions to lower its environmental impact like alternative fuels, exhaust scrubber systems, waste-heat recovery, renewable energy, and the use of ballast water management and slow steaming become increasingly more commercially viable and visible.

Three speakers from this year's Asia Pacific Maritime, taking place in Singapore from March 16 to 18, share their insights on the future of green shipping in Singapore and beyond.

What are some of the benefits of green shipping?

Dr Shahrin Osman, Director, Maritime Decarbonisation and Autonomy Centre of Excellence, DNV: We are going through an energy transition in Singapore and worldwide, and as a bunkering hub, this is an area where Singapore can position ourselves in the industry transformation. The marine and offshore industries here can capitalise, build assets with zero emissions and capture demand from overseas.

How can the maritime industry players in Singapore take advantage of advances in green shipping?

Mr Kenneth Lim, Assistant Chief Executive (Industry) for the Maritime and Port Authority of Singapore (MPA): Decarbonisation is a significant priority. Guided by the Maritime Singapore Decarbonisation Blueprint 2050, MPA will support the decarbonisation of international shipping through a multi-fuel transition, though such solutions are more costly than using conventional fuels and may require retrofitting of new equipment.

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There is hence a need for green financing to close the green premium for adopting sustainable solutions. In addition, international regulations must be in place to allow the use of alternative fuel and provide safety standards for the safe bunkering of such fuels to ensure it is available for ships when they call at other ports. MPA has spearheaded collaborative initiatives across the value chain to help address some of these potential barriers including establishing the Global Centre for Maritime Decarbonisation in August 2021 together with six founding partners. On the digitalisation front, the ability to capture, process and share data and insights will provide significant productivity gains and also help reduce "friction" in the flow of goods. MPA launched the Maritime Digitalisation Playbook in June 2020 with the Singapore Shipping Association and Infocomm Media Development Authority to help companies formulate their digitalisation roadmaps, guide execution and benefit from maritime digital platforms.

Whose responsibility is it to ensure green shipping becomes the norm, governments, individual shipping companies, organisations like the International Maritime Organisation (IMO), or all of these together?

Dr Shahrin: IMO regulation is important, as are the owner and operator. But only if the end customer indicates interest will the industry go green. Regulators should incentivise the first mover, having an incentive scheme will allow the entire ecosystem to have new solutions.

Dr Sanjay Kuttan, Chief Technology Officer, Global Centre for Maritime Decarbonisation: Responsibility belongs to all mentioned working together in tandem. Individual shipping companies need to develop new business models or get access to favourable financing instruments to deliver adequate returns on their investments in decarbonising their assets. Compliance and license to operate with respect to IMO targets for international shipping as well as port and flag states targets that support IMO mandates must be coherent with the government's domestic decarbonisation targets for their maritime sector, covering both land and sea maritime assets.

With green shipping, what are the savings for the shipper and for the environment? Or is green shipping more expensive?

Dr Kuttan: All greenhouse gas emissions reduction/elimination is considered savings for the environment. Fuel cost in shipping is on average about 50 to 60 per cent of the operational expense, and measures like weather rerouting, slow steaming, hull, and propeller cleaning and auto-piloting can deliver anything from 1- to 45-per-cent fuel savings; depending on the route, engine de-rating can deliver from 3- to 25-per-cent, while wind assisted propulsion systems deliver 8- to 45-per-cent savings. However, the expected price of green fuels like biodiesel, green ammonia, bio-LNG, e-methanol will be much higher than that of Marine Diesel Oil (MDO) and Very Low Sulphur Fuel Oil (VLSFO) today, though in the fight against climate change, the higher cost of green fuel may be acceptable if it is a prerequisite, as nations impose green procurement policies or policy instruments. Economies of scale and technological improvements through innovation will lower the costs of production and distribution making them more competitive.

What are some reasons that shipping companies in Singapore and overseas may be hesitant to switch to green shipping?

Dr Kuttan: Shipping is a heterogenous industry with differing vessel sizes, loads that are operating at different speeds, traversing varying distances, in differing climatic conditions and to different ports. The volumetric energy density of any green fuel or energy vector must be able to meet both power and energy requirements of the specific vessel. Access to green fuels or energy vector such as hydrogen is a key decision consideration when retrofitting or building vessels with new propulsion systems. In most cases, the range of technology measures delivers less than 10 per cent energy efficiency, hence the cost of change, usually recovered over a long period of time, is highly dependent on fuel costs.

Have you seen any new innovations that can help the industry move towards sustainability and decarbonisation more efficiently and effectively?

Dr Shahrin: Hull coating, propeller cleaning, heat recovery, for example, these have been around for a while. Retrofitting for energy savings will help but what is important is investment over time. Shipping is still the most energy efficient way of transport worldwide, but in the past one to two years there has been a shift in mindset, from trying to resist to how to best move forward. What is still lacking is transparency in the performance of individual ships. The Poseidon Principles (a framework that shapes lending decisions in the marine sector) is now asking asset owners for the performance of their ships. Singapore is taking a strong position in this area for its marine, offshore and tech sectors. Digitalisation enables real-time transparency and shows that you want you to go green through performance monitoring and improvements.

Dr Kuttan: Algae-based biofuels are becoming more ready in the horizon ahead of green ammonia, green methanol and green hydrogen, with lower adoption barriers in terms of infrastructure requirements and volumetric energy density. The adoption of used cooking oils and Hydrotreated Vegetable Oil (HVO) will pave the way for the acceptance and greater adoption of algae-based oils when it scales. Technological innovations like wind-assisted ship propulsion and on-board carbon capture systems can add to the arsenal of interventions to decarbonise shipping.

APM is back with an in-person exhibition and conference, open free to all trade attendees

The Asia Pacific Maritime (APM), Southeast Asia's premier maritime, workboat and offshore exhibition and conference, hosts its 17th edition at Marina Bay Sands in Singapore from March 16 to 18, 2022. It is the first major in-person maritime trade show after a two-year hiatus. Offering the maritime community the opportunity to reconnect face-to-face, facilitate deals and drive industry growth, the conference will feature eight official pavilions, hundreds of exhibitors showcasing the latest maritime innovations and solutions, 7,000 attendees, in-depth discussions on issues impacting the maritime landscape, and 18 conference sessions and workshops. To learn more about green shipping, register for APM 2022 here.

For more information, visit www.apmaritime.com.