Is shipping lagging or leading on climate initiatives?

Malcolm Latarche
Malcolm Latarche
ShipInsight

03 December 2018


Inside and outside of shipping a lot of lip service is paid to the need for reducing energy use and carbon – in reality CO2 – output but will those who act as pioneers in this regard be winners or losers in the long run?

At the moment that is a question which will need to wait for an answer, but somehow it seems world events are progressing in the opposite direction than many would hope and one can only wonder if the visions and targets such as the IMO’s decarbonisation agenda will ever be realised.

Ask almost anyone if they believe that the world is heading for a climatic disaster and probably the majority would say yes. But ask them to change their way of life and habits to achieve those ends and most would smile and turn away.

For ship operators, some reduction in CO2 emissions is already mandated – at least for new ships – and there are movements aimed at ensuring that existing ships too will have to do something to reduce fuel use or face sanctions such as mandatory speed limits. As ships age so they will be replaced by new vessels meaning shipping’s impact is already set to decrease as far as individual ships are concerned. Few other industries are subject to similar rules and instead are under voluntary reduction regimes where even if there is a declared target there are no sanctions for not meeting them.

That is from the regulatory side, liner operators in particular also come under pressure from some of their customers who – anxious to tout their own green credentials – demand that emission reducing measures are employed.

In an arena as competitive as liner shipping, few operators can afford to lose customers and so do try to fall in with such demands. There is less pressure for bulk and tanker operators as by and large their clients have less dealings with the general public. However, while corporations may genuinely believe that their customers are so enthusiastic about green issues that they must be seen to be doing something, a lot of research suggests that price and customer service are the main drivers behind the public’s purchasing decisions.

This week, the UN Climate Change Committee will be meeting in Poland for COP 24 – the third such event since the Paris Agreement was reached at COP21. It does so having released a new report earlier in the year and announcing recently that the level of CO2 in the atmosphere had reached a new high of 405ppm. That figure is up by a few ppm and equates to 0.0405% of the air being CO2. Supposedly natural sources of CO2 account for around 96% of the figure and shipping’s share of the remaining 4% being just under 3% of the 4%. In ppm terms that would put shipping’s output at 0.00002% of atmospheric CO2 increase.

Leaving the ship related figures aside, the reaction of the public to the alarming report in the autumn has not been what some might have expected. In fact it would seem that some attempts to put across how our individual actions affect the potential for climate change may well be backfiring. In recent weeks, the British Broadcasting Corporation (BBC) has carried several articles highlighting the amount of CO2 released by activities that most would consider important aspects for the quality of modern life. These include the fashion industry, livestock farming, consumption of some other foods and even streaming videos on computers and tablets. One article included the fascinating fact that the production and packaging of just half a dozen or so chocolates involved the same emissions of CO2 as a typical compact car travelling around 10 kilometres.

The BBC has always carried more climate-related news articles in the weeks before COP meetings but in the past there has been more emphasis on industry than consumer choices. For most people living in developed countries, giving up the luxuries of life will be something they are not prepared to do and it seems there is a growing number of people prepared to oppose government initiatives that impinge on their rights or impose more taxation upon them in the green cause.

Nowhere has this become so apparent as in France the very home of the Paris Agreement. The ‘yellow vest’ movement demanding an end to further taxes on fuel has grown up outside of any political movement. For the past two weeks there have been blockades and demonstrations which unfortunately have even resulted in some loss of life and yet it is widely reported that the movement has the backing of around 75% of the French people. It would be a humiliation for the French government if the country’s environmental policies designed to meet the Paris Agreement targets are reversed because of their unpopularity but that is looking distinctly possible.

If the Paris Agreement is undermined, it would complete a series of coincidences that have occurred in the last few months of 2018 where cities that have hosted landmark achievements seem to have turned their back on green issues. Following the election of Jair Bolsonaro as Brazil’s new president – he takes office in January – there have been reports that the Amazon rain forests are under threat by renewal of clearances for farming and mineral extraction. This week the country’s commitment to climate initiatives lessened even more when it pulled out of hosting next year’s COP meeting. Brazil is of course where the whole raft of UN climate initiatives began with the Rio Earth Summit held in 1992.

The next major advance in climate related matters was five years later with the Kyoto Protocol being adopted in Japan. That treaty expired in 2012 but was extended by the Doha Amendment that year but Japan declined to take any further part and has not signed the amendment. This year Japan has further increased its reliance on coal for power production and seems unlikely to meet its voluntary targets under Paris.

Another sign of weakening resolve by politicians was evident this week in the lead up to the G20 talks in Argentina. Those talks will not conclude until the weekend but it is rumoured that the normal closing communique will not include any commitment to the Paris Agreement by the world’s leading economies nor will it refer to the IPCC special report and the urgent need for action.

According to Climate Home News, which reported on Monday that it had seen a draft version of the document — which is thus still subject to change — the draft communique fails to back the Paris Climate Agreement, instead, simply “acknowledging the different circumstances, including those of countries determined to implement the Paris Agreement.” Further, the draft nods in the direction of those countries intent on defending their continued use of coal, saying that there are “varied” energy choices and “different possible national pathways.”

In the world of politics things can change very quickly and while there currently appears to be a lack of will anywhere except at the EU institutions and among NGOs it is too early to say how things may pan out. If there is a change in the political wind – and we may know more when COP 24 gets underway in Katowice – shipping, with a road map for decarbonisation being formulated may find itself travelling in the opposite direction to global political opinion.

That could have the potential to kill off some of the innovative developments that are taking place in the maritime world although pioneering owners will surely embrace others. Both batteries and LNG have gathered some momentum but then so too have scrubbers which some consider a backward step even if the science is finely balanced. Totally emission-free options are said to be on the horizon but then that was also thought to be the case a decade ago and advances since have been agonisingly slow. In the end it will be economics that determines success or failure for both innovators and ship operators