A qualitative survey of shipowners conducted by design and engineering consultancy, Houlder, has highlighted that uncertainty is perceived by shipowners as hindering shipping’s energy transition.
According to Houlder, many ship owners recognised an ‘uncertainty dilemma’ – where decarbonisation choices remain highly uncertain, but that with tightening environmental regulations doing nothing is not an option, so they must try to navigate through the fog of decarbonisation and change course if needed.
From the UK to the US and beyond, 2024 has been a bumper year for elections, with voters heading to the polls in at least 64 countries. Some ship owinterviewed mentioned keeping a close eye on how the 47th U.S. president influences their sustainability strategy before making new decarbonisation decisions, while others cited a lack of clarity from the transport departments they collaborate with as delaying progress.
“What’s the definition of domestic shipping going to be, what are the exclusions, inclusions, are they going to do a phased in approach like the EU has… they’ve just got no answers to any of it at the moment” remarked one passenger ship owner.
Despite uncertainty at a governmental level, interviewees did recognise more certainty at a regulatory level. This is a positive development since the Houlder team last conducted this qualitative survey and workshop with the same set of large and small shipowners from across the container, tanker, bulk, cruise and ferry sectors two years ago.
Views on the EU’s ETS (Emissions Trading System) varied from owner-to-owner. Smaller owners generally saw the ETS becoming increasingly impactful, while larger shipowners tended to feel the EU ETS was already “priced in” to plans but that it is useful as a referenceable price for carbon that can be put into day-to-day operations and business cases.
While many owners were unable to delve into their strategies for FuelEU Maritime, or more likely unwilling to overshare with their competitive aims in mind, the consensus was that they were taking it much more seriously than some other regulations right now. Non-compliance with FuelEU Maritime will mean fines much higher than those incurred from the EU ETS, with a penalty of €2,400 per tonne VLFSO energy equivalent.
“We can’t let uncertainty become an alibi for inaction on decarbonisation, so we undertook this research to understand better how the wider industry can support shipowners in rising to the challenge. Based on recent conversations and developments it’s clear to us that, in shipping and the energy transition, uncertainty is certain and the industry has to find a coping mechanism”, said CEO of Houlder, Rupert Hare
Furthermore, he stated that while the issue might not be groundbreaking, incoming regulations like FuelEU Maritime are pressing shipowners to act quickly. He emphasized the need for owners to simulate various scenarios on their vessels using the information currently available in order to make informed decisions. While the future remains uncertain, he pointed out that taking proactive steps can help reduce anxiety, drawing an analogy to navigating through fog, where one would slow down without navigation aids.
Jonathan Strachan, the Chief Technical Officer, added that while absolute certainty is not achievable, it is not essential for shipowners to successfully navigate the decarbonization challenges. He mentioned that waiting for a perfect solution would leave owners behind, and instead, leading shipowners are already embarking on the journey.
Sharing a similar sentiment, during a recent interview to SAFETY4SEA, Ernst Meyer, President & CEO of Torvald Klaveness, stressed the importance of industry-wide collaboration. He also highlighted the critical role of leadership in making safety a core focus of daily operations.
Two years after its previous interviews, Houlder ‘checked in’ with senior executives from ship-owning companies on key sustainable shipping topics including verified clean technology performance data, how the environmental regulatory landscape has changed, and barriers to the scaling of green alternative fuels. Uncertainty materialised as a clear recurring theme and ‘red thread’ when discussing all of those topics.
Source: safety4sea.com