Achieving 2015 Paris climate targets may be out of reach despite policy and technology advances, Cem Saral, CEO of Cockett Marine Oil, told the Middle East Bunkering Convention 2023, in Dubai.
“Increased intensity on global emissions legislation is the key to driving infrastructure and innovation,” he told the event last week.
He cited data from the Sixth Assessment Report by the Intergovernmental Panel on Climate Change (IPCC) to show that even in optimistic scenarios, achieving the target of limiting global warming to only 1.5°C above pre-industrial levels was unlikely to be achieved, although a target of under 2.0°C could be.
More worryingly, by 2100, moderate to high-risk scenarios portended a rise to between over 2.3°C to almost 5.0°C, which would have disastrous consequences for the planet, triggering cataclysmic events such as the disintegration of the Greenland and Antarctic ice sheets.
Despite a drop in 2020 due to the pandemic, global CO2 emissions are expected to hit their highest-ever level this year, at 37.5bn metric tonnes (mt), after peaking in 2019 at 36.7bn mt.
To take the shipping industry in isolation, demonstrable progress in reducing CO2 emissions has been made since 2009, when the level peaked at around 3.2%, as a percentage of the world total. The industry’s current share, at only 2.3%, has encouragingly not significantly risen since 2014.
However, Saral was keen to stress the fact that although progress has been made with retrofitting the existing fleet with scrubbers and ensuring newbuilds are dual-fuel-ready, the proportion of the fleet allocated to new fuel types was still too small.
Combining the current fleet with the existing orderbook, alternative fuels-capable vessels add up to only 2,008 ships, out of a total of 61,749, when analysing vessels of a size greater than 2,000 gross tonnes. On a gross tonnage basis, this means that although 47.3% of the orderbook is new-fuel compliant, when combined with the existing fleet, only 9.6% of the total when delivered will be fit for purpose.
Excluding LNG-fueled vessels, a paltry 1.09% of the future total fleet plus pending deliveries will be powered using fuels such as methanol, ethanol or hydrogen, as measured by gross tonnage.
Citing a 2022 report on the role of the global ship finance portfolio in meeting IMO targets on reducing greenhouse gas emissions by at least 50% by 2050, he said only seven out of 28 financial institutions were aligned with the global watchdog’s targets.
“On every aspect of decarbonisation, it’s clear that what has been achieved so far falls short of our ambitions, not just related to shipping, but to every aspect of industry. With regards to policy, the Net- Zero 2050 goals set out in adherence to the Paris Climate Agreement are visibly behind our ambitions,” said Saral, speaking to Seatrade Maritime News on the sidelines of the event.
“Achieving a situation where we limit temperature increases to 1.5°C by the end of the century seems extremely unlikely.”
With regard to the shipping and marine fuels industry, existing legislation, whether the EU Emissions Trading Scheme (ETS), as set within geographic bounds, the Energy Efficiency Existing Ship Index (EEXI), and the Carbon Intensity Indicator (CII), were steps in the right direction, but on their own were “not sufficiently intense to drive a far more effective and strong level of innovation for setting up new supply chains or creating novel fuel solutions to drive decarbonisation into higher gear,” he said.
Cockett Marine Oil is a Dubai-based unit of the Cockett Group, which is owned by Vitol and Grindrod, each with 50% stakes. It has offices in 11 countries around the world.