Investing in research to go carbon-free

SOMETIMES us old journalists put two and two together and make five. That was initially the case when I heard that the global shipping industry has come up with a proposal to the the International Maritime Organization (IMO) to accelerate the development of commercially viable zero-carbon emission ships by the early 2030s.

The industry's main representative bodies are jointly proposing the establishment of an International Maritime Research and Development Board (IMRB), a non-governmental research and development (R&D) organisation that would be overseen by IMO member states.

The idea is that IMRB would be financed by shipping companies worldwide via a mandatory R&D contribution of US$2 per tonne of marine fuel purchased for consumption by shipping companies worldwide, which will generate about US$5 billion in core funding over a 10-year period.

Motivation behind proposal

Explaining the motivation behind the proposal, a joint statement says: "Meeting the IMO GHG (greenhouse gas) reduction goals will require the deployment of new zero-carbon technologies and propulsion systems, such as green hydrogen and ammonia, fuel cells, batteries and synthetic fuels produced from renewable energy sources. These do not yet exist in a form or scale that can be applied to large commercial ships, especially those engaged in transoceanic voyages and which are currently dependent on fossil fuels. This US$5 billion in core funding over a 10-year period generated from the contributions is critical to accelerate the R&D effort required to decarbonise the shipping sector and to catalyse the deployment of commercially viable zero-carbon ships by the early 2030s."

It adds: "To achieve the Paris Agreement's climate change goals, rapid decarbonisation is vital - also for international shipping. It is the shipping's global regulator, the UN International Maritime Organization (IMO), which has the responsibility for regulating the reduction of CO2 emissions by international shipping. These ambitious IMO targets include an absolute cut in the sector's total greenhouse gas emissions of at least 50 per cent by 2050, regardless of trade growth, with full decarbonisation shortly after. The 2050 target will require a carbon efficiency improvement of up to 90 per cent, which is incompatible with a continued long-term use of fossil fuels by commercial shipping."

This initiative has come at a time when shipping is coming under increasing pressure to cut its emissions drastically and work quickly towards a zero-carbon situation. The European Union (EU) wants shipping to come under its Emissions Trading Scheme (ETS). The shipping industry organisations hate that idea, seeing it as very difficult to implement and administer. The industry would prefer that any emissions taxing mechanism (Market Based Measure - MBM - in IMO speak) should be a straightforward levy.

Increased impetus

But there has been increased impetus over the past few months towards bringing shipping into the ETS. Generally, there has been more focus by campaign groups and the media on shipping in the run-up to this month's COP 25 climate change conference in Madrid. The general theme has been that IMO is not acting quickly enough. The environmentalists want the industry to commit to slow steaming as an immediate measure and to an MBM as quickly as possible, with ETS the favoured option.

So when IMRB proposal was announced, I assumed it was a response to the current pressure on the industry, thrown together in a couple of months. It turns out I was wrong. A source tells me the proposal is the result of three year's work and not an attempt to pre-empt the MBM debate. The current proposal should, it seems, be taken at face value, as an initiative to boost R&D.

Esben Poulsson, chairman of the International Chamber of Shipping (ICS), says: "The coalition of industry associations behind this proposal are showing true leadership. The shipping industry must reduce its CO2 emissions to meet the ambitious challenge that the International Maritime Organization has set. Innovation is therefore vital if we are to develop the technologies that will power the 4th Propulsion Revolution. This proposal is simple, accountable and deliverable and we hope governments will support this bold move."

All that is true and it would be a disaster if the next meeting of the IMO Marine Environment Protection Committee in March 2020 rejected the proposal. However, this initiative is unlikely to reduce the pressure - especially from the EU - for the imposition of MBM.

Even without the proposed IMRB, considerable progress is being made into the development of carbon free fuels, but there is still a long way to go and this proposal could make a significant difference to how quickly shipping becomes carbon free.