Category Archives: Sustainability

LR study calls for ‘end-to-end assurance of new fuel supply chain’

Posted on January 24, 2023 by | Leave a comment

Shifting to greener fuels sounds easier than it is. The supply chains for common maritime fuels such as HSFO and marine gasoil are highly developed and complex. But for new fuels such as cooking oil, hydrogen, and ammonia, there aren’t any supply chains.

Even if we had excellent marine engines using these fuels, there would be no place to ‘gas up’. In many ways, it’s like the problem auto drivers have with electric cars; you need to know where you can fill up. The highly developed automotive fuel supply chain is one reason why electric cars are taking so long to catch on with the buying public.

Another issue, which plagues the electricity supply chain as well as the marine fuel one, is the ‘greenness’ of fuels. Some fuels burn green, producing less emissions, when they are propelling vehicles; but their means of production is not green at all.

For instance, hydrogen production takes a lot of electricity when it’s made by the usual method, by electrolyzing water. But how green is the energy source for the electricity? Did it come from a coal-fired plant, or from a solar or wind generation facility?

For maritime, we call this well-to-wake analysis of the greenness of fuels and their supply chains. Can we do effective well-to-wake analysis of marine fuel supply chains?

The article by Paul Bartlett below refers to a new report from Lloyd’s Register addressing this problem. The report is well worth getting for maritime pros. It’s going to be crucial to have a full understanding of the overall emissions benefits of all the possible marine fuels, if we are to build new greener ships and develop green trade lanes. A lot of work and money will be needed to set up effective maritime fuel supply chains and supplies.

Another interesting publication on this subject is a Bureau Veritas white paper on alternative fuels. I learned a lot by reading it.

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Paul Bartlett | Jan 24, 2023

LR study calls for ‘end-to-end assurance of new fuel supply chain’

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Posted in Logistics, Shipping, Supply Chains, Sustainability

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New shipping regulation to combat global warming is under fire

Posted on January 16, 2023 by | 1 comment

The International Maritime Organization (IMO) has issued their rules for the Carbon Intensity Indicator (CII), which is intended to combat global warming by reducing carbon emissions. It’s been years in the making.

But some of those affected by the regulation think there are flaws in the index which can produce some unintended consequences.

We know that many ships are chartered– they are operated by firms or people who are not their owners. Charter contracts determine how the ship will be operated and how the ship owner will be paid for allowing the use of his ship. But the contracts may allow the charterer to operate the ship in a way that reduces the CII score and causes the ship to fall into a lower class. Perhaps the ship falls into Class E which says the ship should be withdrawn from commerce– sentenced to the shipbreaker.

The Baltic and International Maritime Council (BIMCO), a non-governmental group that offers clauses for contracts addressing numerous international shipping issues, has prepared a contract clause for chartering contracts. This is a useful starting point, because BIMCO contracts and clauses are often used as a starting point for making a charter contract. Use of the BIMCO contracts or clauses is totally voluntary.

The article below explains some of the issues that can arise between charterers and owners, with equations to boot. The essence of the problem is that the index is based on ship capacity, not cargo carried. So sailing empty miles improves your score on the index two ways– first because sailing light burns less fuel, and second because the miles add to the denominator of the measure, reducing it. The examples given show the effect.

Many feel the index should be based on carrying cargo. And some believe the BIMCO clause will not be workable in contracts, and will not use it. But the problem remains of how to divide responsibility between ship owner and charterer for managing the CII score.

I tend to believe any rule is better than nothing. And I think charterers and shipowners will work out how to manage the contract problem. As for empty sailing or sitting in port, I don’t think anyone wants to sail without a paying cargo, or suffer delays even to improve the index. So everyone, owners and charterers, will continue to fill their ships when they can, and sail shorter routes when they can, simply because it’s expensive to operate the ship you’ve chartered; you have to earn a profit at it.

For all the complaining, the CII is still a good thing. We will have to see if it can be tweaked to everyone’s satisfaction.

Greg Miller·Wednesday, December 21, 2022

New shipping regulation to combat global warming is under fire

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Posted in Logistics, Shipping, Sustainability

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No green shipping corridors without landside infrastructure

Posted on December 1, 2022 by | 1 comment

Green shipping corridors are the latest effort to create strategies for ESG compliance, particularly environmental, for the global shipping industry. These corridors are starting to show up in the planning stages. The intent is to create a connected system of ports that have all the improvements necessary to allow those ships using it to achieve a high level of compliance with green shipping standards.

That means the availability of fuels that meet international green standards such as those of IMO 2022, as well as green technology for loading and storage of containers and other products; and yard equipment that meets green operating standards.

Of these perhaps ensuring the availability of the fuels required is the most challenging. Availability alone is not enough; the price must be competitive, and sufficient storage must be in place; and long-term availability must be assured. The variety of fuels now under consideration for green ocean transport is a challenge. In addition to LSFO, some ships will soon require green methanol; major players such as Maersk and CMA-CGM are investing in methanol-powered ships. And recent studies have shown that fuels can burn greener, but the means of their production and storage have to be included in the fuel evaluation. An interesting study of this was made by Bureau Veritas (BV), a classification society, which described in detail the greenness from well to wake of a wide variety of power options from biodiesel and HS/LSFO to methanol and ammonia. Not all of these are easy to make and store.

So infrastructure will be incredibly important for the green corridors.

Some newly-announced corridors start from Singapore, which already has a large fuel infrastructure, and is a globally important financial center for dealing in fuels. That will be a tremendous advantage. European ports like Rotterdam and American ports like New York already have quite a bit of financial and storage infrastructure. These ports are already part of announced green corridors. However, even at these developed ports some of the alternative low emissions fuels are not available, nor is there the handling capability present.

The interview with the CEO of GCMD casts useful light on what’s needed.

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Prof Lynn Loo, CEO of GCMD, in an interview at TOC Asia.

Much of the focus in decarbonising shipping is on the vessels, however, without developing landside infrastructure projects such as green corridors cannot take off.

Marcus Hand | Nov 30, 2022

No green shipping corridors without landside infrastructure

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Posted in Logistics, Ports, Shipping, Supply Chains, Sustainability

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