Shell recently commissioned a report into the feasibility and challenges of meeting the IMO 2030 and 2050 emission reduction targets, surveying CEOs and industry stakeholders around the world.
In order to create meaningful progress in the next five years, five solutions are suggested in the report:
Scale-up customer demand: Create scale in demand for low- or zero-emission shipping through charterers’ and customers’ commitments that include long-term contracts and green procurement criteria. Natural candidates to lead this solution are state-owned and publicly listed companies with proximity to end consumers (e.g. containers, food bulk), and others with ambitious scope 2 and 3 net carbon footprint commitments.
2. Global regulatory alignment: Create a level playing field globally and reduce uncertainty regarding regulations and timeframes. New IMO guidelines due in 2023 should provide clarity and should be aligned with leading local and regional regulatory bodies (eg. the EU, China and the USA). Short-term regulatory incentives should also be considered.
3. Cross-sector research and development: Intensify partnerships to develop zero- or low-emission fuels through joint research and development (R&D) across shipping, other harder to abate sectors and the energy industry. Create a much larger pool of capital and expertise to evolve new technologies and increase the likelihood that production and transportation infrastructure will be available once future fuels are commercially viable.
4. Scale-up controlled pilot projects: Increase R&D effectiveness by running end-to-end green pilot projects involving customers, charterers, operators, owners and ports on specific routes and vessel types. Operators that follow a predetermined schedule, such as container ships especially on shorter and busier routes, are likely candidates for pilot projects.
5. Coordinated industry commitments: Increase the reach of existing initiatives – such as the Getting to Zero Coalition, the Clean Cargo Working Group and others – by consolidating objectives and strengthening the coordination of various concurrent workstreams. A body with a specific mandate, formed with dues from the industry, could accelerate the shift from ideas to action and help break the deadlock.
Full report here: https://www.shell.com/energy-and-innovation/the-energy-future/decarbonising-shipping.html