The burning issue of ending carbon dioxide emissions has been at the center of discussions among international shipping representatives at Posidonia Web Forums Week, which took place from October 21 to November 3, 2020, through a variety of digital platforms. During Posidonia Web Forums Week, a total of 16 online events took place.
Charlotte Bucchioni, Associate Editor EMEA of S&P Global Platts, commented that the industry is still waiting for clarifications from the International Maritime Organization (IMO) on the timetable for compliance with the obligation to stop carbon dioxide emissions.
In particular, she said: “We have to wait until 2023 to have a clearer picture from the IMO regarding the compliance actions that the shipping industry has to take. “This has caused difficulties for the industry, which has the lowest level of orders in a decade, due to a combination of reduced demand for crude oil due to reduced carbon emissions targets and uncertainty over fuel regulations.”
It is in this uncertainty about fuel regulations that shipowners blame the lack of activity and investment in building new ships or upgrading fleets.
According to Petros Pappas, CEO of Star Bulk, this fact is the main reason for the reduction of orders: “80% of the absence of orders is due to uncertainty about fuel regulations,” he said, speaking to a panel. organized by Lloyd’s List, and added: “The key issue that will keep us on our toes for decades to come is ending carbon dioxide emissions. It prevents us from ordering new ships “.
Ms. Ioanna Prokopiou, CEO of Star Traders, who participated in the same panel on Lloyd’s List, said: Achieving the transition to environmentally friendly shipping does not mean that we have to bring the shipping business up and down as it is today. This process must take place smoothly. It is not possible to build an environmental paradise on financial ruins. Regardless of the proposal, it must be sustainable. If we need trillions to meet our carbon footprint, who will pay for it? “A big part of the problem is the cost.”
She continued: “If we order a ship today, making assumptions about the requirements of future regulations, we risk finding ourselves with a ship of outdated technology already at the stage of construction, as there is no clear framework in terms of regulations and compliance. We need to look at the problem as a whole, from the extraction of fuel to its combustion. ”
Mr. Pappas agreed with her: “It is not something we can do on our own. Shipyards must first carry out the necessary research and development processes to build ships that will use the fuel of the future. New fuel supply companies must then develop the appropriate infrastructure. And governments must fund the whole effort. Banks, for their part, have to provide capital and charterers have to sign long-term contracts. This will disperse costs throughout the shipping value chain, and before shipowners can invest in zero-carbon dioxide vessels, the other parties involved must assume their share of responsibility and provide funding and incentives. ».
George Plevrakis, ABS Global Sustainability Director, organizer of the Shaping Maritime’s Future Together online event, expressed similar views on the need to address the issue of ending carbon dioxide emissions: there is a universal distance between the intended and the expected result. Shipping will not achieve its goal until 2050 unless an intensive carbon off program is implemented. This, however, requires a team effort. Shipping alone cannot do that. ”
The end of carbon dioxide emissions has been at the heart of discussions for days between shipping executives on various video conferencing platforms as part of Posidonia Web Forums Week’s daily, full program, and as expected, IMO Secretary-General Kitack Lim was asked at the Tradewinds Shipowners Forum when he estimated that there would be a clear picture of the regulatory framework.
“Once we have developed the core of our policy, but also the guidelines for how to implement it, we need to develop or update more than ten directives, which will be ready by mid-2021. In practice, therefore, the industry will have a much clearer picture of the policies that will be adopted at the end of next year “, said Mr. Kitack Lim and added:” The IMO consists of 107 member states. Some of them are developed countries and others developing. Each country has different economic conditions, so it is not easy to reach a consensus between all Member States. However, the rating system is a very powerful tool and can be used by the market for commercial activity. Therefore, once there will be specific instructions, the system will work very efficiently. I hope that the experts will realize it soon “.
Mr. Kitack Lim agrees that a collective approach is needed to address this issue: We need to intensify research and development initiatives on alternative fuels. “We have a special fund for research and development and in this direction, the public and private sectors must work together to jointly develop the fuel of the future without carbon emissions.”