Maritime Decarbonization – Blue Skies over North America

While much of shipping’s decarbonization talk concerns international vessels, it is worth taking a look at the situation in North America concerning shipping that will fall outside the purview of all those widely reported (including here) existing and upcoming regulations, schemes, and platforms. The Blue Sky Maritime Coalition– an organization formed with the objective of addressing the path towards 2050 specifically for United States and Canadian vessels outside of the IMO umbrella, was formed just about a year ago. Its mission is “…to achieve commercially viable net-zero carbon emissions by 2050. Recognizing the unique challenges to decarbonization that exist in the United States and Canadian markets…” Importantly, “Blue Sky emerged from the reality that no one of these stakeholders can achieve decarbonization without concerted, targeted, and collaborative efforts between them all.”

The Coalition has now released a report prepared by industry experts at the Climate Change Initiative at Vanderbilt University (in Nashville, Tennessee- about a mile from the Cumberland River), with the title PATHWAYS TO NET-ZERO 2050 IN THE NORTH AMERICAN MARINE SHIPPING INDUSTRY. This is the first of three reports that the Coalition anticipates releasing; the other two will delve into the North American marine business with greater specificity.  The overall aim of the effort is “…identifying the pathways and approaches that Blue Sky has initially identified as most likely to accelerate significant GHG emission reductions and serve the North American marine shipping sector in achieving net-zero—measured on a life-cycle emissions basis from ‘well-to-wake’—by 2050.”

The report, which the Coalition sometimes refers to as a “Position Paper” (more on that later, spoiler alert- it is very telling), covers familiar ground when looking out over the next few years. LNG is mentioned as a sensible transitional fuel. The report notes that: “The abundance of natural gas within North America and the current and ongoing investment in long-lived LNG infrastructure make LNG a critical emission reduction pathway for marine shipping.” After noting industry successes with LNG, and its growing delivering mechanisms, the authors point out: “…advances in emerging control technologies are likely to continue to decrease total life-cycle carbon emissions related to LNG, there is an increase in Renewable Natural Gas (RNG) production in the U.S. that can displace traditional LNG production emissions, and we expect LNG to be an immediate and high potential transitional fuel in the path to net-zero maritime emissions.”

Of course, other fuels are mentioned. Vanderbilt’s team has previously released a report covering U.S. inland waterways (with privately-owned inland barging giant Ingram Barge- the biggest in the business, headquartered about two miles down the pike from Vanderbilt) and harbors, singing the praises of electrification but noting its better applicability for vessels with intermittent use (such as fleeting tugs, ship assist, or  ferries with layovers built into schedules)- allowing more time for battery charging. But crystal ball gazing on future fuels is just that, so I leave that alone. Coalition member companies will experiment with fueling alternatives and hopefully some surprises, albeit on the positive side, could result. The report (released three weeks after the SEC’s blockbuster on Environmental disclosures, says: “Market and regulatory forces are likely to continue to be an increasing source of decarbonization pressure throughout the marine shipping value chain.” Yep, as we’ve noted multiple times here.

In spite of the impossibilities of forecasting which future fuels will win out, this group is well positioned to actually effect real positive changes, in contrast to the folks meeting in London two months out who will be driven in multiple directions -and maybe way off-course, by political currents flowing at an exponential scale. As I read it, the idea of this report being described by the Coalition as a “Position Paper” rather than, let’s say, a “Feasibility Study”, or similar, reflects the interesting and uneasy dynamic that I’ve noted multiple times. Shipping folks (from the U.S. but also Canada) and other “stakeholders” (however and whomever) are now trying to interface. It’s not easy for traditionally private and media shy maritime folks to be sitting at the same table with environmentalists. Now, some U.S. players are even speaking at conferences- sitting on panels discussing ESG’s impact on shipping- which would have not been the case even two years ago- though it is indeed a necessary and positive development. The Coalition should be commended for arranging such a sit-down- surely a formidable task. However, the only real “position” taken in the first of the three reports is that “Blue Sky recognizes that in any projection of the future, flexibility is inherently needed. This report is not intended to pinpoint the ‘winning’ fuels in a net-zero future, but to identify the marine fuels and propulsion systems that we currently expect to most effectively accelerate the transition to net-zero emissions by 2050.”  Industry is in the best position to find the path to 2050. Hopefully, the maritime folks can keep the politicians at arms’ length from the table, test out new fuels/ technologies and achieve some necessary positive results.