The 2020s must be the decade of action if we are to solve the shipping industry’s share of the global climate challenge.

The International Maritime Organization (IMO) has to deliver substantial progress by the end of this year to accelerate the work needed to decarbonise shipping. Finding the fuels of the future is a comprehensive task, though the technologies exist and, in the case of methanol, are ready to be picked up.

The 2020s must be the decade of action if we are to solve the shipping industry’s share of the global climate challenge before we reach a critical tipping point.

Transport and logistics account for a considerable part of GHG emissions globally, with shipping alone accounting for 2-3%. We, the corporate leaders, must make decisions with long-term perspectives and accelerate the transition now.

At the same time, the global community and international regulatory authorities need to move faster on the climate agenda than has been the case so far. At its MEPC76 meeting on June 10-17, the International Maritime Organization (IMO) adopted already-agreed short-term efficiency measures and agreed to start discussing market-based measures. The US has said the overall ambition of the industry should be zero emissions by 2050 rather than the current minimum goal of a 50% reduction.

At A.P. Moller – Maersk we fully agree. In 2018 we set ourselves an ambition of achieving a carbon neutral fleet by 2050. At the time we thought it to be a moonshot; now we see it as a challenging, yet achievable goal.

The price of emissions

Time is running out for the IMO. Market-based measures consisting of a greenhouse gas price should be introduced to close the competition gap between new, green fuels and fossil fuels. That way, switching to green fuels will make economic sense for the industry. We support such a CO2 price, and it must be substantial enough to achieve true price parity.

Shipping is inherently a global industry – and thus challenges and framework conditions should be addressed globally. If the IMO doesn’t reach agreement on global rules now, we are facing an inadequate patchwork of different rules in different regions. When our vessels sail from China to Europe or between China and the US, regional initiatives are challenging.

However, if the IMO can’t deliver, then quotas for greenhouse gases through an Emissions Trading System in the EU might be needed to push the industry on the right track towards decarbonisation. The EU then needs to balance its role as a regional regulator with that of a leading bloc at IMO. A strong voice from the EU at UN level is needed to raise ambitions and secure the adoption of meaningful global regulations.

It is, nevertheless, encouraging to see that the decarbonisation of the shipping industry has moved up on the international political agenda. The US is calling on the IMO to step up its ambitions, shipping is part of the UK’s climate plan and Singapore is investing $90 million in a research centre for decarbonisation.

At A.P. Moller – Maersk, we urge that this momentum is translated into action and collaboration to create the right market conditions for a carbon neutral future for the industry. It is not just from the political scene that we are currently witnessing a changed conversation around the climate challenge and the urgency for action. Consumers are changing buying habits and expect that goods are not only produced but also transported with the climate in mind.

About half of our 200 largest customers – especially those that produce directly for consumers – have set ambitious and science-based targets for their emissions. These goals extend beyond their own production to their entire value chain, which means that they depend on us as their logistics company to transport their goods with as low CO2 emissions as possible. We will and must help them with that.

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Thailand Business News covers the latest economic, market, investment, real-estate and financial news from Thailand and Asean. It also features topics such as tourism, stocks, banking, aviation, property, and more.

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