Last reviewed 9 October 2018
The shipping industry is a major emitter of greenhouse gases (GHGs). John Barwise investigates whether the industry is doing enough to curb pollution.
More than 90% of the world’s traded goods are carried by sea. Each year, tens of thousands of giant tankers, bulk carriers, refrigerated freighters and container ships transport billions of tonnes of goods around the world along numerous trading routes.
These ships, some of which are more than a quarter of a mile long, are the backbone of the global economy, shifting everything from metal ores, oil and compressed gas, fresh fruit and vegetables and manufactured goods. Take a look around your office, factory or the home and much of what you see will have been freighted in by sea in huge containers at some point in its journey.
Given the sheer scale of this global transport system, it is perhaps hardly surprising that shipping is one of the world’s most polluting industries, with a collective global carbon footprint bigger than many industrialised countries. Outdated and inefficient engines, low-grade bunker fuels and poor ship design are largely responsible.
There is continued pressure on the industry’s primary regulatory agency, the International Maritime Organization (IMO), to do more to reduce the industry’s global environmental impacts.
Liberalised markets need global shipping
Liberalisation of national economies has fuelled free trade and increased demand for consumer goods, which in turn has stimulated continued growth in global merchant shipping. The world’s shipping fleet is registered in over 150 nations, with more than 50,000 merchant ships trading internationally, employing an estimated 1,647,500 seafarers. Over the last four decades, total seaborne trade has quadrupled, from some eight thousand billion tonne-miles in 1968 to over 32 thousand billion tonne-miles in 2008.
The United Nations Conference on Trade and Development (UNCTAD) estimates that the operation of merchant ships contributes about US$380 billion in freight rates within the global economy, which is equivalent to about 5% of total world trade. Container freight shipping accounts for around 60% of the world’s seaborne trade, with more than 1.5 billion metric tonnes of goods, worth about $4 trillion, transported annually around the globe in containers.
As world trade grows, seaborne trade continues to expand, bringing benefits for consumers across the world through competitive freight costs. Business is thriving in the shipping industry and the prospects for future growth look promising.
This continued growth in the shipping industry comes at a price. Fleets of ships that transport goods around the world are a major source of GHG emissions and other pollutants. Most ships use “bunker fuel”, often referred to as the “dregs” of the fossil-fuel refining process, after gasoline, diesel and other light hydrocarbons are extracted from crude oil during the refining process.
Bunker fuel is extremely cheap but it’s also one the world’s dirtiest diesel fuels, with a much higher carbon and sulphur content than diesel fuel used in vehicles. Between 2007 and 2012 (the most recent data available from the IMO), global shipping by sea amounted to an average of around 1 billion metric tonnes of carbon dioxide (CO2) per year, equivalent to approximately 3.1% of annual global CO2 emissions. To put this in context, if global shipping was a country, it would rank sixth, ahead of Germany, in the world’s table of GHG emitters.
The latest update to the study by research consultancy CE Delft projects shipping emissions to increase by between 20% and 120% by 2050 if other sectors decarbonise successfully. Under a business-as-usual scenario and if other sectors of the economy reduce emissions to keep global temperature increase below 2oC, shipping could represent some 10% of global GHG emissions by 2050.
In addition to CO2 emissions, other air pollutants from bunker fuels also cause major health risks. Nitrogen oxides (NOx) and Sulphur oxides (SOx) are the two main pollutants from the ship’s emission. The shipping industry is among the world’s largest emitters of SOx, behind the energy industry, with the sulphur dioxide (SO2) content in bunker fuel oil up to 3500 times higher than today’s diesel standards for vehicles. SO2 is highly toxic and a primary cause of respiratory problems such as bronchitis.
NOx reacts to form smog, acid rain and ground-level ozone, which is associated with asthma and other adverse health effects. SOx and NOx can convert in the air through complex chemical reactions to form fine particulate matter (PM). These secondary particles increase toxicity in the lungs causing impaired ciliary function, damage to epithelial cells, inflammation and oxidative stress.
According to Europe-based research body, Transport & Environment, air pollution from international shipping accounts approximately for 50,000 premature deaths a year in Europe, at an annual cost to society of more than €58 billion.
Regulating the shipping industry
The IMO is the United Nations system’s regulatory agency for the maritime sector. Its global mandate is “safe, secure and efficient shipping on clean oceans”. IMO pursues that mandate by adopting international maritime rules and standards that are then implemented and enforced by governments in the exercise of “flag, port and coastal State jurisdiction”.
The IMO has struggled to build consensus on ways to reduce harmful environmental impacts of shipping. The International Convention for the Prevention of Pollution from Ships (MARPOL Convention), adopted in 1997, only came into force in 2005. The regulations seek to control various airborne emissions from ships that are harmful to human health and the environment, including SOx, NOx, ozone-depleting substances, volatile organic compounds and shipboard incineration.
Some progress has been made since the regulations came into force, particularly on limiting sulphur emissions. The current global limit for sulphur content of ships’ fuel oil will be reduced from 3.5% mass by mass (m/m), to 0.50%m/m from 1 January 2020. There are even stricter limits of 0.1% sulphur content for ships sailing in a Sulphur Emission Control Area, which in Europe covers the Baltic Sea, the North Sea and the English Channel.
The IMO MARPOL Convention has also strengthened the standards relating to shipping NOx emissions, with NOx emissions from new ships to be cut by 16–22% by 80% from 2016/2021 in some areas, compared to 2000 levels. While ship fuel sulphur standards apply to the entire fleet, the NOx limits only apply to new ships. In addition, the strictest limit, called Tier III, currently only applies to new ships sailing in designated areas around North America from 2016, the NOx Emission Control Areas.
The EU has already agreed that the 0.5% sulphur requirement will apply to all ships in 2020 within 200 nautical miles (370km) of EU Member States’ coasts. China, which has some of the world’s busiest container ports, is also demanding cleaner fuels.
One of the biggest challenges for the IMO has been trying to agree a global consensus on reducing GHG emissions. Shipping and aviation are both major contributors to GHG emissions, but neither sector was included in the UN climate accord, agreed in Paris in 2015. Subsequently, the International Civil Aviation Organization (ICAO), the IMO’s sister agency governing aircraft, adopted a global climate agreement two years ago, aimed at carbon-neutral growth from 2020. This has left international shipping isolated as the only major sector not covered under a global GHG agreement.
It was against this backdrop that governments and the shipping companies from around the world met at the IMO headquarters in London recently, to hammer out a new agreement that would set targets for emissions reduction in the shipping industry.
After two weeks of intense negotiations, the IMO finally announced its first global emissions strategy, with a plan to cut GHG emissions by at least 50% by 2050 and phase them out from international shipping altogether “as soon as possible in this century”.
© 2017 International Chamber of Shipping
The new GHG strategy has been welcomed by most in the shipping industry. The Secretary General of the International Chamber of Shipping (ICS), Peter Hinchliffe, described it a “Paris Agreement for shipping”, referring to the 2015 UN agreement on GHG emissions mitigation.
“We are confident this will give the shipping industry the clear signal it needs to get on with the job of developing zero CO2 fuels, so that the entire sector will be in a position to decarbonise completely, consistent with the 1.5°C climate change goal.”
In addition to the global emissions cap, the strategy sets a carbon intensity reduction target — the amount of emissions relative to each tonne of shipping cargo — of at least 40% by 2030, rising to 70% by 2050.
However, the agreement falls short of EU expectations whose joint position was for a minimum 70–100% cut in carbon emissions by 2050 compared to 2008 levels. But this was never going to be an option, given that the USA, Saudi Arabia, Brazil and other major contributors to the IMO conference had already voiced their opposition to targets above 50% in the initial strategy.
Can the shipping industry go further?
The shipping industry has access to a wide range of options and technologies to cut pollution, most of which are currently available and implementable. A major report released by the intergovernmental organisation International Transport Forum (ITF) at the OECD says the shipping industry could be near carbon-free by 2035.
As a starting point, the report points out that in a baseline scenario, without additional policy measures, carbon emissions from global shipping are projected to reach approximately 1090 million tonnes by 2035, representing a 23% growth of emissions by 2035 compared to 2015.
Among its many recommendations, the ITF recommends that the IMS sets and supports emissions-reduction targets to drive decarbonisation of maritime transport. It also advocates smart financial incentives such as a carbon price for global shipping to incentivise the industry to come up with its own solutions and allocate resources optimally.
ITF formulated four possible decarbonisation pathways for shipping, which foresee CO2 emission reduction ranging from 82–95% of the projected 2035 level. A major part of the required reductions could be realised through alternative fuels and renewable energy. Technological measures are available to increase the energy efficiency of ships and reduce emissions. Finally, operational measures could also achieve a considerable share of the required emission reductions.
Another key factor in improving efficiency is ship design. An independent study published by CE Delft shows that, in general, the design efficiency of new ships improved significantly in the 1980s, was at its best in the 1990s and deteriorated after that. Design efficiency in the 1980s and 1990s was up to 10% better than in the following decade.
The Energy Efficiency Design Index (EEDI) is the product of a global effort to reduce GHG emissions from ships. EEDI was made mandatory by the IMO for new ships and the Ship Energy Efficiency Management Plan for all ships in July 2011. The EEDI requires a minimum energy efficiency level per capacity mile (eg tonne mile) for different ship type and size segments.
The CO2 reduction level (grams of CO2 per tonne mile) for the first phase is set to 10% and will be tightened every five years to keep pace with technological developments of new efficiency and reduction measures.
The EEDI is a non-prescriptive, performance-based mechanism that leaves the choice of technologies to use in a specific ship design to the industry. As long as the required energy efficiency level is attained, ship designers and builders are free to use the most cost-efficient solutions for the ship to comply with the regulations.
Reduction rates have been established until 2025 and onwards when a 30% reduction is mandated for applicable ship types calculated from a reference line representing the average efficiency for ships built between 2000 and 2010.
Pioneers or buccaneers?
The shipping industry does have its champions. ESL Shipping, which operates in the Baltic Sea, recently launched what it claims is the world’s most eco-friendly, dry cargo vessel. Christened “Viikki”, and built in China, the 160m, 26,000-tonne vessel is fuelled by liquefied natural gas, reducing more than 50% CO2 emissions than vessels of the previous generation.
Maersk Line, which handles a sizable percentage of the world’s ocean freight, has also launched its first “Triple-E” container vessel — which stands for economy of scale, energy efficiency and environmentally improved capabilities. The 400m long vessel features state-of-the-art waste heat recovery system that minimises fuel consumption and helps reduce CO2 emissions by more than 50%. Maersk says this is the first of 20 Triple-E cargo ships to be deployed for the Asia-Europe trading routes.
However, the top of class award should perhaps go to Greenpeace following the launch of its third campaign ship. Rainbow Warrior doesn’t carry cargo, but at scale, this state-of-the-art ship uses sail power so that it can sail more and motor less. It also includes systems to recycle the engine’s heat and waste “grey” water, and a hull designed to minimise friction in the water, making it extra sustainable. The hard coating on its hull is 100% free of biocides, the wood in the cabins is FSC-approved and there are on-board recycling systems and biological sewage treatment.
Rainbow Warrior also has a helicopter hangar and a helideck — which will no doubt be used to check that other seafarers are acting responsibly on the high seas.