Urgent action is necessary to accelerate the pace of the energy transformation and decarbonisation of the economy, including the shipping sector, a strategic sector of the global economy. According to IRENA, with around 80-90% of global trade enabled by maritime shipping, the shipping sector is responsible for around 3% of annual global greenhouse gas (GHG) emissions on a carbon dioxide (CO,)-equivalent basis. International shipping sector alone accounts for around 9⅜ or aloba emissions associated with the transport sector.
To put this into context, if the international shipping sector was a country. it would be the sixth-to seventh-largest CO, emitter, with CO, emission levels comparable to Germany's.
To address these concerns, IRENA’s report maps out a path to a decarbonised maritime shipping sector. The report, titled: “A Pathway To Decarbonize The ShippingSector By 2050”, primarily focuses on the analysis of a pathway to a mitigation structure that will limit global temperature rise to 1.5 degrees Celsius °C) and bring CO emissions closer to net zero by mid-century.
This article by the African Catalyst reviews IRENA’s publication on the actions needed to be prioritized towards decarbonizing the shipping sector by 2050, highlighting key facts and insights.
Enabling Actions to Raise The Shipping Sector Decarbonisation Ambition
The IRENA 1.5°C Scenario represents a mitigation pathway to limit global temperature rise to 1.5°C and bring CO emissions closer to net zero by 2050. However, achieving this goal cannot be accomplished by technology alone. According to IRENA, climate goals and decarbonisation ambition can be raised by taking timely and appropriate measures.
The International Maritime Organization (IMO) indicates that by 2050 maritime trade could increase between 40% and 115% in comparison to 2020 levels. At present, about 99% of the energy demand from the international shipping sector is met by fossil fuels, with fuel oil and marine gas oil (MGO) comprising as much as 95% of total demand (IMO, 2020a).
Starting now, energy efficiency needs to be promoted and effectively embraced. Not only will this result in an immediate reduction of carbon emissions, but it can also potentially result in important energy savings and thus increase monetary revenue for shipowners and operators. From a technological perspective, renewable energies are competitive. Indeed, renewable energy costs have been falling at an accelerated rate.
The African Catalyst in partnership with Brickstone is co-hosting the Enabling Infrastructure Forum scheduled to hold in June 2023 in Lagos, Nigeria. The forum will discuss closely with the Government for policy evolution and on-the-ground implementation which attempts to influence key stakeholders in the areas of – Early Stage Development and Financing of Low Carbon Infrastructure.
The forum will assemble key leaders in Africa's infrastructure delivery to discuss infrastructure challenges and opportunities; and how innovations in project delivery and readiness, deal structuring, and sustainability solutions can help to solve critical issues for Low Carbon Infrastructure
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For renewable energy-derived fuels to become the prime choice of propulsion, further cost declines are needed, particularly in renewable energy supportive technologies (e.g. electrolysers and hydrogen storage). In this context, sectoral decarbonisation can be accelerated and ambition can be raised beyond the climate goals by fostering investment in the production of renewable fuels.
For this purpose, adopting relevant and timely coordinated international policy measures is greatly needed. It also requires stakeholders to develop broader business models and establish strategic partnerships involving energy-intensive industries, as well as power suppliers and the petrochemical sector.
Divided into four categories, following actions, according to IRENA, can raise decarbonisation ambition beyond the 1.5°C Scenario goals:
- Multi-stakeholder Synergies. With this, stakeholders associated with the shipping sector must be fully mapped out, fully engaged and working towards the establishment of strategic partnerships and a common goal. Policy makers, shipowners, ship operators, port authorities, renewable energy developers and utilities should work in parallel towards a common decarbonisation goal. Also, synergies and enhanced international collaboration must be fostered among all stakeholders involved in the field of powerfuels. Given the promising decarbonisation path offered by powerfuels, raising awareness across the shipping sector and governments about the role of powerfuels in both the transport sector and in energy-intensive industries is of prime importance. Lastly, engagement needs to go beyond the obvious players; acceptance by civil society is also needed.
- Policy-driven Actions. There are a lot of policy driven actions that can be tapped into towards achieving the decarbonization goal. IRENA suggests: enabling a level playing field by establishing a realistic carbon levy. Each fuel must have a carbon price implied that may be adjustable over time as the market becomes more favourable for renewable energy fuels; tightening EE mandates and developing suitable mechanisms for monitoring and enforcing the adoption of EE measures; promoting strict local regulations to limit airborne emissions at ports and inland waterways, and make cold-ironing at ports compulsory whenever available; developing sustainability certifications and suitable schemes such as guarantees of origin (GO) to guarantee ship operators of the renewability index of a given fuel and its sustainable origin; and anticipating the upcoming demand from end-consumers by implementing a labeling system for sustainably shipped goods.
- Research, Development and Innovation. This includes: tasking research and development (R&D) institutions with the analysis of the upstream dynamics of renewable fuel production for shipping, including a GHG lifecycle analysis of the different renewable fuels; devoting efforts to the development of sectoral strategies that clearly define the volume of renewable fuels required to decarbonise the shipping sector and ensure the necessary deployment of renewable power in the context of competing demands; and boosting efforts and ensuring adequate levels of resources focused on the development of engine technology capable of harnessing green H2-based fuels, thereby ensuring that technology is well advanced ready to be deployed and scaled up by about 2025.
- Invest in Renewables and Energy Efficiency. According to IRENA, this entails enabling affordable lines of credit and introducing incentives to foster the development of carbon-zero new vessels and financing of retrofits in existing vessels; allocating national resources to support the identification of geographical areas with high renewable energy potential and devote significant efforts to understanding the production costs of renewable power fuels in the short and long term; and investing in an efficient, safe and reliable supply of renewable fuels for the shipping sector via sector coupling mechanisms among bunkering service companies, port authorities, utilities and the renewable energy sector.
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