A new study estimates that the EU has, to date, spent $250 million on Liquefied Natural Gas (LNG) projects in the marine sector, providing partnership funding to private interests that support a total of $500 million investment.

potentially increasing emissions from shipping

The study, by UMAS, finds that this half-billion dollars spend will, at best, have no significant climate benefits and could potentially increase greenhouse gas emissions from shipping. LNG is incapable of helping shipping achieve the emissions reductions required under the recently adopted International Maritime Organisation (IMO) strategy on reducing GHG emissions from ships.

Sulphur compliant but ...

LNG is an option for complying with the 2020 sulphur cap but by focussing on short-term improvements to air pollution and replacing heavy fuel oil with LNG it locks-in non-sustainable - in both commercial and environmental terms - fossil-fuel infrastructure for decades to come.

A switch to LNG could increase GHG emissions from shipping when upstream emissions are included in the measurements. LNG infrastructure leaks methane, a much more potent GHG than CO2, making the overall climate impact of LNG worse.

GHG emission cuts only possible with non-fossil fuels

Reducing total annual emissions from shipping in-line with the initial IMO strategy objective - at least 50% GHG reduction by 2050 on 2008 levels - and the Paris Agreement temperature goals, is only possible with a switch to increased use of non-fossil fuel sources from 2030 at the latest and with rapid growth thereafter. Options include a mix of wind and solar, hydrogen, ammonia, battery electrification, all of which need significant investment to be able to get to market within the next 12 years.  

Sustainable biofuels – providing they can be sourced in a highly competitive market where all other segments are seeking low-carbon fuels - could play a part in the future fuel mix. As blends with HFO they might help to extend the timescale for the introduction of primary renewable energy and synthetic fuels like hydrogen and ammonia. 

LNG as transitional fuel ...well maybe not

Many proponents argue that LNG is a transitional fuel and a natural precursor to biogas (biomethane) produced from waste. However, deep questions remain over the availability of such bioenergy to meet all of shipping’s needs, and uncertainties that it will be cheaply available. The ‘LNG as a transition fuel’ argument seriously risks future pathways to decarbonization, creating a single path dependency and technology lock-in.

Encourages out-of-sector investment

If the current investment in LNG as a marine fuel continues then reducing total annual emissions from shipping in-line with the initial IMO strategy objective could only be possible through GHG reductions being made by offsetting – that is buying carbon credits from other sectors who are reducing emissions. This means finance flows out of the shipping sector, funds that might have been better spent creating in-sector real GHG reductions and improving the industry’s own commercial resilience. By relying non-shipping carbon markets the industry is dependent on the linkages providing sufficient access to low cost out-of-sector emissions reductions, something which is currently highly uncertain.


Alternative Fuels

With the critical Marine Environment Protection Committee 72 meeting coming up at IMO in April there’s a lot of talk about alternative fuels as a means of rapidly transitioning the global fleet to zero emission. By ‘alternative’ we aren’t talking about LNG which, it turns out, does look much like a transition fuel let alone a sensible choice for a long-life shipping asset. The well to wheel emissions for liquid natural gas are about the same, some studies say more, than fuel oils.

No, what we’re talking about as the current favourite bets are ammonia and hydrogen. Ammonia is widely used in the fertiliser industry and so it’s industrial manufacture and handling is understood and established. Hydrogen is still at an early stage in its development as potential transport fuel but it’s said to have promise.

What we’re looking for is an easy, drop-in replacement to fossil-based fuels. But silver bullets are hard to find.

Using either hydrogen or ammonia requires ships engines to be modified or replaced and both fuel types would need new bunkering infrastructure and storage facilities both on board and in ports. This requires the whole industry to agree that one or the other fuels is the best solution so that infrastructures can evolve in line with demand. Think Electric Vehicle charging points, chickens and eggs.

Another option being bandied about are biofuels produced from plant-based materials. There are a couple of big issues here too. On a finite planet there’s a finite amount of land. We can use that to live on, to grow food on or to grow fuel on – but we can’t do all of those things.

And then there’s waste. What we think of as ‘waste’ can also be a feedstock for energy production. Once we switch our mindset from waste to feedstock it becomes a valuable commodity. There may be a plentiful supply but the there’s also a high demand for the energy that can be harnessed from it. The value of what once thought of as ‘waste’ is increasing, once you couldn’t give it away and now there’s a price on it. In the end other sectors may make claim to the waste feedstock for fuel ahead of shipping, where other solutions may be better suited.

It’s complicated.

But with global pressure bearing down on the IMO tackling the upcoming sulphur regulations will be a walk in the park compared to the GHG emission rules needed to decarbonise shipping by 2050. The sooner we embrace this complexity and co-create workable solutions the more robust and resilient our industry will be.

Worse Things Happen at Sea

Growing up in the little port of Teignmouth on the English south coast I was somehow able to persuade my Art teacher that the comings and goings of ships would be a good topic for my O Level. So, I spent quite a bit of time down by the docks. I never met or knew anyone who worked on a ship but I wondered who they might be, where they were going, where they came from. It all seemed very romantic.

At around the same time, with a bunch of my school mates, I completed Ten Tors – a gruelling 2-day event across Dartmoor run by the Army. It was one of those things I did without thinking as a teenager but now I realise that it gave me a deep attachment to Outdoors.

More than 30 years later I started to think about shipping again. After leaving school (with Art O Level!) I was lucky enough to work in all sorts of exciting innovation projects – launching mobile phones, Formula One teams, financial information systems, offshore yacht racing and renewable energy. The possibility for renewable energy in commercial shipping is an untapped opportunity and one I’m now developing now in an industry collaboration. In discovering how the shipping industry works I’ve started learning more about the remarkable people who have responsibility for keeping global trade moving.  Some of it’s not good.

All sailors will have to endure, to varying degrees, horrific conditions – foul weather, dangerous sea states, risk of hi-jacking, long absences from loved ones with little or no contact (internet just isn’t a regular feature on many a merchant ship), long distances from any medical care, poor pay and working conditions in badly managed ships, and, sometimes, being abandoned in a foreign country when a ship owner goes bust with no means of getting paid or even water, food, heat, or returning home.

And meanwhile all of us blithely go about our consuming with little regard for how our stuff gets to us. Look around you – where did that phone/laptop/jacket/avocado come from? How did it get here? Who suffered?

The Sailors Society look out for some of the people whose invisible labours make our lives what it is.

I’ve always enjoyed a walk. But when I turned 50 and discovered middle-aged spread I took up running. A first, not very far and very slowly. But I completed the Bath Half Marathon three years later…and hated almost every minute of it. I had, however, enjoyed the training for it. By good fortune – and the internet – I stumbled across Climb South West’s inaugural 'Dartmoor in a Day' challenge. Last September I walked the 50k from the North to the South of the moor in an event as close to Ten Tors for Grown Ups as I could have wished to have discovered. I loved it.

And so it was that when Climb South West announced that they were running an event in Snowdonia called the Welsh3000s I signed up. It was after all only 50k in 24 hours and I had already done 50k in 11 hours – how hard could it be?

A few weeks later I read the small print and that was when the two words “brutally tough” hit me between the eyes and then my stomach, which turned to water. It’s taken me a while to pluck up the courage to find out what the ‘3000’ means. I’d hoped it was feet; turns out it’s metres.

This challenge was going to demand more of me than I had imagined. I couldn’t do it alone. A good friend (@sailorbaejon) had just signed up to do the London Marathon to raise money for the Sailors Society and so I copied him. After all, a marathon is just an unimaginably awful thing to do voluntarily.

For the last 2 months, for 5 or 6 days a week I’ve been in training: lifting weights; learning about a whole new world of burpees, crunches and squat jumps and performing multiple ‘sets’ of ‘reps’. I’ve been scrambling up cliffs on holiday, running as fast as I can up really steep hills, jogging as far as I can over undulating terrain, walking for hours in searing heat and, more recently, pouring rain; I’ve been pedalling a stationary exercise bike in my garden. And I’ve been dancing for hours with a gang from my village - practicing and participating in (and winning!) our local Carnival.  

In the moments when it hurts, when I just can’t be ar*ed, when I think I’ll never breathe again, when I don’t want to get wet, when it's too hot, then I remember that I made this choice. So many seafarers don’t get to choose – it’s the only career that can generate enough money to support their families – and they have to endure so much more day in, day out.

I remember that worse things really do happen at sea.

Please support me in supporting the Sailors Society. https://www.justgiving.com/fundraising/diane-gilpin3


Once, in a leading maritime daily news feed, I saw a sentence that went something like this: “The upside of the apocalypse is that ships will be able to sail straight across the North Pole and reduce sailing time by 20%.” I was reminded of this when reading the weekend papers and my eye fell upon a $500bn plan to refreeze polar ice caps.

I’ve wondered often what version of apocalypse the author had in mind when predicting an ‘upside’. The first definition Google offers me is: ‘the complete, final destruction of the world’ - not much room for shipping in that scenario.

Temperatures in the Arctic are currently about 20C above what would be expected for the time of year, which scientists writing in ‘The Arctic Resilience Report’ describe as “off the charts”.

Increasingly rapid melting of the ice cap risks triggering “tipping points” that, they claim, could have catastrophic consequences around the globe. The tipping points include: growth in vegetation on tundra, which replaces reflective snow and ice with darker vegetation, thus absorbing more heat; higher releases of methane, a potent greenhouse gas, from the tundra as it warms; shifts in snow distribution that warm the ocean, resulting in altered climate patterns as far away as Asia; and the collapse of some key Arctic fisheries, with knock-on effects on ocean ecosystems around the globe. All this has prompted physicist Steven Desch to devise a novel solution. With colleagues from Arizona State University his idea is to replenish shrinking sea ice by building 10 million wind-powered pumps over the Arctic ice cap. In winter, these would be used to pump water to the surface of the ice where it would freeze, thickening the cap.

It’s all a bit extreme. The sci-fi imaginings of geo-engineering make us feel that there’s a silver bullet solution. Unless someone’s got $500bn they are prepared to gamble on the efficacy of 10million wind pumps we’re probably going to need to do something a little more practical and a little more immediate.

The international shipping community has already banned HFO in the Antarctic. Perhaps now is the time to provide the Arctic with similar protection. Some of us are old enough to recall the PR nightmares of maritime oil spills polluting much loved coastal regions back in the day. It’s really difficult to clean up in the event of a spill, even in relatively benign environments, without trying to imagine how it could work in remote and hostile Polar regions. HFO produces higher levels of air and climate pollutants than other marine fuels, it produces more ‘black carbon’ which further darkens the ice to accelerate warming and melting. Given the severe risks that heavy fuel oil poses to vulnerable polar ecosystems to help both the shipping community and our global climate, upon which we are all utterly dependent, navigating a safe passage through the all alarmist predictions by banning HFO in the Arctic as a matter of urgency would be a shrewd way ahead.


In my quest to bring you, dear reader, information about new technologies well before other shipping commentators I attended a seminar, at business advisers and accountants BDO’s Baker Street HQ, on the eve of the US election, to learn about the challenges and opportunities from realising the ‘holy grail’ of renewable energy – large scale energy storage.

An expert panel comprising technologists, bankers and industry thought-leaders were challenged by leading journalists, and the audience, to identify the biggest obstacles to success and suggest ways to get over, or around, them.

If I closed my ears to the words ‘energy storage’ and replaced them with ‘shipping’ - then I’d heard the conversation a thousand times before.

The experts identified three clear challenges to growth of the sector: lack of regulation, lack of certainty around cost and predictability of different technologies, and the knowledge gap between the urgent need for industry take-up and the tangible long term commercial benefits providing resilience in a volatile future.

Human issues around lack of available time and resources to properly investigate and embrace the nuances of various alternative solutions for different assets were highlighted. As in shipping there was a sense of ‘being lectured’ by renewable energy evangelists [is that me? sorry!] that the asset managers aim must be to go 100% renewables. Whether the managers were responsible for municipal buildings like schools, hospitals and community housing or commercial office blocks, the failure to appreciate that these people are also required to balance the not inconsequential difficulties of austerity, recession and a range of other non-energy related problems must be appreciated. [Will try harder]

Solutions were to be found through the development of innovative business models which focussed beyond the technology. Solutions that deployed sophisticated analytics tools and novel finance mechanisms built on renewable energy’s unique value proposition: fuel is free. These system enablers mitigate commercial risks and enable finance to be provided outside of the asset managers remit of responsibility, thus making their buying decisions much more straightforward.

The often-repeated mantra that renewable energy is nonviable because it is intermittent was challenged head-on. That the grid is inflexible in its current form, and energy demand is not subject to any meaningful management was highlighted as a key challenge. There is sufficient renewable energy available, through combining different power sources – wind, wave, solar, ground source and so on - to create 100% renewable domestic energy. The grid needs to become more flexible on both the supply and demand side.

What we can learn in shipping from these kinds of profound challenges to our old thinking is that just because that’s the way it was always done, it doesn’t mean it’s the way it always will be done;

the future is very different from the past.

The results of the US election that emerged the following morning underlined that we are experiencing a period of great change. Our recent past can no longer be a reliable guide to the near future. Predictability in an uncertain world is a luxury. We can be sure that the wind will continue to blow, the sun to rise and tides to turn – harnessing that energy gives us security and resilience to withstand the winds of change.

Evoke the racing mindset - reflections on the responsibilities of leaders in shipping

I’ve just got back from a climate seminar at Cambridge Institute for Sustainability Leadership. Dr Emily Shuckburgh’s early morning presentation shook us to the core. She’s no graven faced scientist talking in algorithms and graphs (but here’s a very sobering one anyway). 

She’s lively, entertaining and shares pictures of her gran and her kids. She’s very, very human. And that makes her all too believable. The evidence she presented is irrefutable - our species is in deep, deep trouble. Off the scale kind of trouble.

Dr Emily Shuckburgh obe

Dr Emily Shuckburgh obe

We, the audience, struggled to come to terms with what we’d heard.

Reflecting on our group reactions to the myriad of complex feelings that had been unlocked by this new, terrible knowledge I realised that our various responses were like those of kids that have been found out. I’m a mum, I know.

At first we tried deflecting the blame: “it’s not my fault” pointing the finger elsewhere to protect ourselves.

Much like the finger pointing - “but we’re much better than THEM” – in Splash 24/7’s Monday report from Copenhagen where Henrik Madsen, former ceo of class society DNV GL, pointed at the agreement thrashed out by ICAO, aviation’s equivalent to IMO at the UN, earlier this month on emissions reduction. He told delegates that the agreement ICAO had reached was “very weak” and was only binding from 2027.

That still doesn’t make it OK for the IMO to do nothing.

I now know that even if all of the commitments made in the Paris Agreement last winter were kept we are still in grave danger of global catastrophe – mass migration caused by droughts and sea level rises triggering greater and greater civil unrest. As if what we’re experiencing right now isn’t awful enough, this is only the tip of (a rapidly melting) iceberg. Paris might mean we won’t experience species annihilation but it’s still going to be bad. We can’t keep playing chicken.

Some of us felt guilt and remorse. ‘I’m not doing enough’. Collectively we pledged to go above and beyond individual actions and effect material change wherever we could, as this was a highly influential set of business leaders this will make a difference.

We need to see this same sort of courage from the IMO.

Others of us wanted to know why the ‘grown-ups’ allowed us make this terrible mess. Where were the leaders?

It’s as if we were asking the people ‘who knew’ to stop our bad behaviours because we never realised it would turn out so bad.

The scientists have been telling us shipping for years (this from 2012 is an example) that climate change is the defining challenge of our age. But leaders don’t want to act because how we must collectively respond is inconvenient, expensive, unpopular. The reality is the later we leave it the more inconvenient, expensive and devastating reality will be. When will the leaders of the shipping industry have the courage to act?

Hope came in the shape of Paul Rose – the polar explorer and TV presenter who helps scientists unlock and communicate important stories. Paul told us of several smallish, but significant, victories he’s had in effecting material change. He suggested we were entering a new age of enlightenment. The Enlightenment was marked by an attitude captured by the phrase:

"Dare to know".

In the 21st century age of enlightenment it takes huge courage to know, and we can’t unknow.  And now we must figure out, with great haste, what we can actually do.

I’m from a motor/yacht racing background, I’ve already opined in Splash 247 about the benefits of a racing mindset in achieving, what Paul Rose describes as, ‘hairy-arsed’ goals.  

Set a demanding target, set a deadline and clearly articulate the generous prize (in this case, a small matter of remaining in existence) and then let the market figure out how to get on the start line – those who can will find the sponsors to fund the great endeavours. They’ll build the best teams and those teams will be utterly focused and inspired. Every second of every day will be devoted to winning. That’s how it was in F1, in offshore yacht racing. This is a very real race against the ticking clock of climate change. It’s like F1 and America’s Cup combined and put on steroids.

We dare to know. And we dare to win.

This is the courageous 21st century age of enlightenment attitude, the mindset we need to evoke to tackle the climate challenge. 

Just Google it

Last December Google announced that it was making the largest ever renewable energy purchase by a non-utility. It added 842 megawatts of renewable energy capacity increasing its overall renewable energy capacity to 2 gigawatts—something the company likened to “to taking nearly 1 million cars off the road”—as it works toward tripling its renewable energy purchases with the goal of powering 100% of operations through renewable energy by 2025. Google is the largest corporate purchaser of renewable energy on the planet. It says: “these contracts not only help minimize the environmental impact of our services—they also make good business sense by ensuring good prices.” On May 12 2016 Google’s owner, Alphabet, took top spot from Apple in as the most valuable publicly listed company by market capitalization on the Financial Times Global 500 rankings.

And what’s all this got to do with shipping? I hear you cry. Well, dear reader, Google just filed a patent for a revolutionary new ship design that focuses on wind power.

In a departure from systems that use wind power to propel the vessel Google’s patent uses an energy kite to generate electricity. The energy kite simulates the tip of a wind turbine blade, the part of a turbine that makes most of the energy. Rotors on the kite act like propellers on a helicopter to launch it from the ground station. Once the kite is in flight, air moving across the rotors forces them to rotate, driving a generator to produce electricity, which then travels down the tether to the grid. The tether is made of conductive wires surrounding a high strength core. The tether connects the kite to the ground station, and transfers power and communications between the kite and ground station in both directions. The ground station holds onto the tether, and is used as a resting place for the energy kite when not in flight. The ground station occupies a smaller footprint than conventional sailing rigs. A computer system uses GPS and other sensors, along with thousands of real-time calculations, to guide the kite to the flight path with the strongest and steadiest winds for maximum energy generation. The intention is to fly the kite 500m above the ship where the wind speeds are stronger.

Google’s innovation won’t use that clean electricity to propel its engine but to power an electro-dialysis system to extract CO2 from seawater to produce hydrogen gas. A refinery system uses the CO2 and H2 through the Fischer-Tropsch process to produce the synthetic diesel fuel C11H24. It then converts this synthetic fuel into ethanol by using syngas fermentation an alternative fuel for shipping.

Whether Google’s technology solution is the right answer for every ship in the world its intervention is likely to help further accelerate the long overdue transition in shipping to renewable energy which as Google says:

“Better for our business and better for our environment”. 

It’s no accident that Google’s aim to shift all its business systems to 100% power from renewable energy contributes to its position at the top of the FT Global 500 leader board. 


Analysis Paralysis

To state the obvious, we live in an uncertain world

everything is in a state of perpetual change. The key to success in this dynamic environment is the ability to adapt quickly to new situations as they emerge, to build resilient systems.

To try to understand and plan ahead we seek comfort from information, from experts and, in this digital age, vast amounts of data are available. For every argument ‘for’, there’s an equally compelling one ‘against’. To try and understand risk we allow ourselves to stray in to territory infested with a subjective, anecdotal information. (‘Brexit’!)  To counter this hear-say and opinion academics secure funding to undertake in-depth studies in one subject or another and produce even more data to consider. Our virtually unlimited access to information often leads to greater fear of making the wrong decision.

There’s unprecedented turbulence across the shipping industry – in charter rates, in cargo flows, in shipbuilding, in legislation - but we aren’t seeing much evidence of a shift towards creating a more resilient system. We are so busy focussing on managing the day-to-day and the analysis of all the data that we risk being blindsided when change happens. No one saw Lehman Brothers’ collapse and few anticipated $30 barrels of oil.

One of the best antidotes to analysis paralysis is to get other perspectives. Learning from what the automotive industry has done, what worked and what didn’t was a great opportunity. Hearing how they successfully design more efficient vehicles both through the manufacturing process and in reducing ‘tailpipe emissions’ is information that is worth taking on board. At the recent sustainable design conference hosted by the Institute of Materials several key lessons emerged that could benefit shipping: progress comes through an iterative process – we can’t expect one great leap and then to be able to relax back into a 'new normal'; set deadlines and targets – even if they are missed the direction of travel is accelerated; and start before you feel ready – progress begins today, decisions made on best available information may not be perfect, but doing nothing holds greater risks.

The most resilient systems are found in nature.

Resources such as energy, light and water are all utilised optimally – nothing is wasted. So, why do man-made processes not follow the same rules?

The accumulation of ever increasing amounts of data with the belief that they can underpin the next critical action is simply a delaying tactic. 

In the eye of the Storm

On February 20 2016 Cyclone Winston roared across the island nation of Fiji wreaking havoc. Winston killed more than 40 people and flattened communities. 32000 homes were destroyed; 350000 people have been affected. Rebuilding is extra challenging because of the remoteness of many of the communities.

Increased frequency and intensity of storms is caused by the increase in global temperatures which in turn is caused, in the most part, by emissions created by us in developed countries. March 2016 broke the record for being the biggest monthly increase in temperatures. Climate change seriously threatens the very existence of Pacific Island nations so it is no surprise that the region is calling for urgent action

In May 2015, the Marshall Islands submitted a proposal calling for the International Maritime Organisation (IMO) to establish a GHG emission reduction target for international shipping, consistent with keeping global warming below 1.5°C.  The paper was supported by 25 countries but the IMO postponed a decision pending the outcome of UN climate change talks in Paris.

Last December the world united behind the clear goal to ensure that global increase in temperatures do not exceed 2 degrees Celsius. The UN Paris Treaty went so far as to enshrine the more ambitious aim of keeping temperature rises to below 1.5oC. We are already seeing a global temperature increase of 1.15oC against pre-industrial figures.

With the Paris outcome abundantly clear, a number of countries have decided to revive the discussions at IMO’s upcoming meeting of its Marine Environment Protection Committee in London next week on setting a clear emissions target or "fair share" for shipping.

Without significant additional effort the shipping industry risks undermining the Paris Agreement which is critical the very existence of the Pacific Islands. And, ultimately, all of us.

Shipping has yet to be included in the climate Treaty but is coming under increasing pressure to commit to a ‘fair share’ carbon target. Under current policy, shipping’s CO2 emissions are expected to rise by 50-250% by 2050 whilst the Paris Agreement gives us the target of reaching net-zero carbon emissions by then. That gives little more than a ship’s economic working lifetime, around 30 years, to turn things around. There is simply no room for the sector’s currently expected 1.2-2.8 gigatonnes of carbon emissions in the fast approaching zero emission world.

All of this means any ship built today must be able to operate in the new low carbon world. Clear leadership from the IMO is essential to trigger the necessary technology shift.

Meanwhile in Fiji the traditional sailing vessel Uto ni Yalo has been put to work ferrying building materials, and essential supplies to remote islands throughout the region. Using local navigational, sailing and building skills, combined with the effort of the national Olympic team – the region produces some of the best weightlifters in the world - whose national gym was totally destroyed in the cyclone.

The community has rallied together, deploying old technology in new ways to solve an existential crisis.

The region has much to teach the developed world. 

A Conducive Environment

The necessary market drivers for rapid technology change in shipping are coming into alignment. 

Shipping’s customers are creating a strong commercial demand pull for low carbon ships. Most countries and large corporations have publicly committed to emission reductions and urgently need decarbonised supply chain to achieve that. Simultaneously a significant shift in climate policy is looking increasingly likely at the upcoming IMO marine environment protection committee meeting later this month. There’s a wide coalition looking to implement a policy push through ‘fairshare’ carbon targets.  

To rapidly accelerate the necessary design and development there is much we can learn from the rapid evolution of the onshore wind industry.  System change in energy came about because three dynamically interconnected disciplines were stimulated simultaneously – technology design, finance and reliable performance analysis. 

The first wind turbines sited on windy hills produced just 50KW power, now, within just a few short years, offshore turbines with 8MW generation capacity are being installed far out to sea.

It starts with great design

Designing for 100% reuse reduces carbon by 29% according to research led by Dr Paul Gilbert from the UK’s University of Manchester and Dr Peter Hodgson from Tata’s sustainability team. Build the vessel for extreme longevity, looking to condition based monitoring, new materials and operation approaches to extend use of asset over time further reduces embedded carbon.

Power a ship with 100% renewable energy where fuel cost is predictable over the lifetime of the ship and we can already see that today an ultra-low carbon, future-proof, resilient asset is entirely possible by combining existing and proven technologies in new ways. 

New financial products and innovative business models for the maritime sector, informed by the onshore renewable revolution, are now emerging. They reflect the fundamentally different economics enabled by renewable energy – the asset value is decoupled from volatile, commodity fossil fuel prices. Harnessing, through technology, freely and infinitely available power changes risk profiles and attracts investment from the burgeoning renewable energy sector familiar with these new economic dynamics. 

The final piece in the jigsaw is the replication, for the maritime sector, of the analysis tool that underpinned the development of onshore wind. Big Data analysis tools test new vessel designs against 30 years hindcast data in wind, wave and currents and enable all contracting parties – asset developer, financier, end-user – to predict the value of renewable energy to any project, to effectively monetise that value, and thereby give all contracting parties confidence. Making the unpredictable predictable enables rapid design optimisation.

Once the collective creativity across the shipping industry is brought to bear on the climate change challenge it will be possible to realise, and profit from, the vast potential in maritime renewable energy and we can anticipate the exponential growth mirroring that of onshore renewable energy. 


Take it to the Limit

Shipping is the most efficient form of transport. It’s a mantra we hear a lot and in light of all the attention on the sector it’s probably worth unpacking the soundbite. We all know global supply chain logistics are a lot more complex than they first appear to be.

Let’s start with a definition: Efficiency is the (often measurable) ability to avoid wasting materials, energy, efforts, money, and time in doing something or in producing a desired result.

So, what do we mean when we think of shipping as ‘efficient’? It moves more freight per tonne mile compared to any other form of haulage. Which is great.

But, shipping is ‘efficient’ per tonne mile only because ships are very big and very slow compared to any other form of haulage transport.

To improve efficiency per tonne mile shipping’s response thus far has been, in the main, to increase the size of a vessel so as to improve its economies of scale, that is to carry more cargo so every unit of fuel used to move each unit of cargo is proportionately less. Larger ships enable lower emissions/fuel cost per tonne mile when the vessels are fully utilised, but if they aren’t then the economies of scale argument falls away.

Pushing a very large and very empty ship through the water isn’t efficient at all.

Large ships make it harder to match supply to demand. The response to that might be to slow down in order to use less fuel. Slower ships also allow cargoes to be consolidated to ensure a full vessel but both these solutions, which improve shipping’s ‘efficiency’, risks customers’ production processes and in turn is jeopardising the service shipping offers its customers.

Yesterday I heard a steel industry representative say he had to fly in raw materials because the available shipping service failed to be able to meet his critical deliver schedules.

Thinking about the ‘desired results’ part of our definition let’s suppose the shipping industry’s desired result is something like: to provide the most efficient form of transport to its customers so it can be as profitable as possible. In our steel import example, we can see that’s an opportunity lost for shipping – the transport business went to another mode of transport offering a better service. I suggest this poses a question about the efficiency of shipping. It’s truethat one-off situations will occur from time to time in any supply chain but to be most efficient we as an industry should be avoiding modal shift wherever possible. When we see it we should consider it a bit of a warning and that closer self-examination is needed.

At present the shipping system is not fully optimised and so long as it assumes it’s already doing everything it can it will remain so.

There’s a wealth of technology available that could help improve shipping’s service offering in terms of both energy and operational efficiency. From a bottom line perspective, it makes sense to examine how to be really efficient. Shipping is already very good, but could do better. And the principle beneficiaries would be the shipping industry itself. 

Ch-ch-ch-ch changes (turn and face the strange)*

Change is a massive business opportunity for those courageous enough to embrace it.

The post-Paris climate change agreement celebrations are over and now we must recognise that shipping is under pressure* to reconcile the opposing beliefs that there is a fundamental conflict between transitioning to a low carbon economy and economic growth. It is being amply demonstrated in land-based energy sectors that one leads to the other.

There’s no denying, of course, that it’s a huge challenge. The incumbent fossil fuel infrastructure has been established over many decades is multi-layered, complex and the beneficiary, according to the IMF, of subsidies to the value of $10m per minute. Decarbonisation requires a fundamental system change.

But post-Paris structural change is inevitable and shipping needs to decide if it is to become a hapless victim of the new future or if it will steer its own positive course towards becoming a stronger, more resilient, fit-for-purpose industry.

After all a ship built in 2016 will be required to function in a zero emission world before the end of its normal working life, according to ambitious and urgent aims agreed in Paris.

With the 2nd largest coal company in the US filing for bankruptcy yesterday its clear there’s a new reality emerging.

It’s going to be really valuable for shipping to learn from the rapid transition that is changing land-based energy industries, particularly as shipping leaders often liken ships to ‘mobile power plants’. Renewable energy accounted for 78% of Germany’s power requirement on July 25th 2015. It’s true this was a rare metrological combination of sun and wind that allowed this peak but Germany is securing, on average, a quarter of its power from renewables. Scotland got 41% of its power from wind energy in 2015, a 16% increase on the previous year. Scotland’s Energy Minister highlights renewables’ contribution to his country’s energy security as a key economic benefit.

Reducing dependency on volatile fossil fuels improves economic stability, energy security and increases prosperity.  Shipping could use these commercial advantages right now.

To have any chance of reaching the 2o target agreed in Paris innovation needs to be accelerated in both energy efficiency and renewables. The good news is investment likes clean energy; the International Energy Agency predicts in its World Energy Outlook 2015 that clean energy will attract a cumulative total investment of $7.4trillion by 2040. $400billion was invested last year attracted by the ever-improving business case offered by clean energy.

The new secretary general of the IMO, Kim Litack, highlights in his inaugural address, the need to work together. He envisions strengthened partnerships between developed and developing countries, between governments and industries. I would add to that collaboration NGOs and smart new SMEs bringing learning from other dynamic sectors to bear on shipping’s problems.

It’s critical that we convene a ‘safe space’ where diverse parties can develop real solutions to transitioning to a low carbon economy, to galvanise ‘green growth’.

Setting an absolute CO2 emissions reduction target across the industry will create a clear goal, stimulate innovation and allow access to the new investment opportunities just when the industry badly needs it.

It always seems impossible until its done. Yesterday the German Foreign Office thanked David Bowie on twitter for “helping bring down the wall”. 2016 – now we all need to be Heroes*.

*the wisdom of David Bowie

Nerves of Steel

Yesterday I went to hell. On a train.

I witnessed the birth of steel plate of the type that will be used to build our ships.

In a dark, dangerous, filthy, oily, searing hot, screaming loud cathedral of a place. Molten steel rolled at shocking speed, emitting tornadoes of steam. Standing in full protective gear on a gantry above red-hot steel plate - an image burned into my psyche forever. A truly extraordinary experience.


And yet day in day out guys in full woollen suits (wool being the best fire retardant material - thanks sheep!) operate, perform and deliver in that dehumanised inferno. Making the steel that never satiates our lust for stuff.

The safety gear gave me a weird sense of detachment - hard hat, glasses, ear plugs, gloves, boots. I was there, but only partially so. Maybe that’s how a steel worker survives that place.

Much of the steel made in Scunthorpe is used in infrastructural projects. Train lines, ship building, bridge supports, bomb proof barriers. And yet walking from my hotel to the plant in the morning the infrastructure in sunny (and it was) Scunny was collapsing. The ‘pavements’ were off-road hiking courses. Empty houses, deserted streets.

In 1972 26 000 people were employed in Scunny. Now it’s 4000 as a result of the Basic Oxygen Steelmaking (BOS) process which maximises economic efficiency.

How do 22000 people evaporate? The wonderful man, Ron Wilkins (get to his Open Garden this weekend if you can), our guide, has worked at Scunny for more than 40 years. At the outset of his career most of his family worked at the plant. Now it’s only him. His kids live elsewhere, where they can find work. Our communities break down. 

Approaching the Tata Steel site I was struck by the scale. I learned that the Romans had established a mine on this site. Geography had gifted the place and just down t’road in Yorkshire in the Wolds limestone could be mined to make steel.

The process became commercialised in 1860 - by relations of David Cameron.

Now it’s epic. A site with a 15 mile boundary enclosing mountains of steaming slag, piles of virgin ore, heaps of scrap for reprocessing (the content of our ships’ steel plate at the outset will be 20% recycled), caterpillar trucks the size of houses, cooling towers and furnaces and rolling mills as far as the eye could see. 

The good people we met do what they can - within the constraints of a profit-only paradigm - to re-use and recycle. Carbon monoxide is reused to produce energy. 1 million trees have been planted. Kingfishers flash across reclaimed mines and water sources. Dust is swept up (on an epic scale) and ore deposits re-used. A project to make the site energy self-sustaining was shelved because of the economic downturn.

The people we met at Tata Steel are proud - rightly so - of what they make and the human endeavour and ingenuity they deploy every hour to produce this great stuff.

We talked of them helping us build the flagships of the future, of bringing that abundance of human ingenuity to bear on the mega-problems facing our world today through collaboration and a re-engineered intention.

It is simply not possible to get 100% recycled steel to build ships today. But we can embark on an urgent journey together to make it possible before it’s too late.

And there growing on the slag was part of the answer. Vipers Bugloss reclaiming the land. In that most hostile of environments. How do they do it? Adapt.


Those plants ...nerves of steel!



New Ships on the Horizon

Recently a group of designers, naval architects, ship owners, operators, engine, machinery and equipment manufacturers gathered to explore the various possibilities available for meeting shipping’s need to rapidly decarbonise.

The event was led by the Tyndall Centre for Climate Change Research, School of Mechanical, Aerospace and Civil Engineering, University of Manchester.

Last week we abbreviated the science that points to the shipping sector’s need to reduce emissions by 85%. The challenge set to this group was to develop realistic technical solutions to enable a 90% CO2 reduction by 2050. The findings make interesting reading.

If shipping is to meet its significant decarbonisation challenge there are radical and/or step-change mitigation measures that warrant examination in terms of CO2 benefits, opportunities and trade-offs. Clearly technology is interconnected with operations and practices, and therefore the ‘step-change’ in absolute emission reduction may only emerge through addressing all three simultaneously.

Nevertheless, opportunities for decarbonising shipping are numerous. 

Detailed analysis of how to decarbonise the shipping sector through the use of novel or ‘niche’ technologies is under-researched.

Incentivising the use of renewable propulsion requires new confidence in their operational performance that can only be provided by full-scale demonstration projects and given the urgency of the challenge, there is no option but to trial new low-carbon ships for future trade.

Perhaps more fundamentally, and core to the decarbonisation problem in general, is a tendency to look for short-term financial gain from decisions that have very long-term repercussions impossible to ‘cost’ in the existing system. 

Whole system change is necessary, and will not emerge from conventional decision making tools. 

Finally, it is clear that the shipping sector is intertwined with other parts of the economy, with decision making around low-carbon pathways in other transport modes and industries likely to influence and constrain decarbonisation in shipping. Competition for the same low-carbon fuels or for additional power from the grid will be rife, with technological development often happening more rapidly in other less complex, less conservative sectors.

Shipping does have some options where it has exclusive access to power sources that others cannot harness – wind propulsion ticks many boxes for shipping, but is the sector willing to take that risk? At the end of the day, there remains a naïve assumption that incremental and longer-term technology changes will be enough to avoid climate change. This is completely at odds with the science.

Red Tape and Greenwash

The law is an ass. Sometimes, maybe. Generally the global community regulates for the wider good and as a consequence so we can all enjoy a better quality of life. But breaking laws is endemic in our culture – avoiding taxes, breaking speed limits, trespassing – we’ve all done it. It’s where we believe we know better than the regulators, and that ‘red tape’ is there just to inhibit our personal and corporate growth.

That’s where VW – and, its speculated, other automotive players – have badly misjudged the pettiness of their crime, and the mood of the public. It wasn’t just ‘greenwash’, VW broke the law. The law is there to save lives.

There is a growing determination to tackle all emissions across society. Many blue-chip global corporations pledged this week to source 100% of their electricity from renewable energy to reduce CO2 emissions and to (their words) “seize the business benefits”. In the wake of the VW scandal they know this can’t be marketing puff but genuine commitment. Their confidence that it will pay off is  derived from the fact that all sorts of people – from Pope to pauper; from China to the USA – want to see all emissions reduced in absolute terms. VW playing fast and loose with regulators around NOx emissions is a warning. What we learn is that we the public don’t like being duped and commercially it’s a disaster. NOx is bad – implicated in a wide range of fatal illnesses from asthma to dementia. CO2 is worse

The  science  about CO2 can be distilled  pretty  succinctly:  if  the  global  economy  emits  more  than  ~1428Gt of CO2  we expose  ourselves  to  dangerous  climate  change. This will  cause  massive  damage  to  society  globally,  and, if  continued  unchecked,  bring about  the  extinction  of  our  species. We  know  the  total  CO2 budget  for  all  sectors,  and  we  know  that shipping’s  GHG  represents  approximately  2–3%.  If  shipping  is  to  remain  on  average  at 2–3% , the  total  emissions  that  can  be  emitted  are  33Gt. That’s it, right there – the target for shipping. With expectations for continued growth in world trade and corresponding transport demand, with GHG  emissions reducing fast from other sectors, then  shipping’s  GHG  intensity  (gCO2/t.nm)  would,  across  the  whole  sector,  need  to  reduce  by  about  85%. What a challenge.

There’s an absence of voluntary, ambitious action in the shipping sector to really address the challenge. There’s probably enough technology but not enough motivation.

I’ve had the dubious benefit of working for a decade in F1. The key driver (ahem) for delivering new solutions to the grid every fortnight is money. The most lucrative sponsorship revenues go to the top teams. If you fail to get cars out for the start of every race you get eye watering fines. Each team comprises hundreds of people from all disciplines – engineering and fuels, materials and aerodynamics, commerce and legal, psychology and fitness. It’s the financial hit that focuses everyone’s minds. If you aren’t on the grid you aren’t in the race.

Air pollution causes real harm. We, collectively, have been trying to limit the health damage caused by emissions over the last 50 years by putting pollution limits in place. By cheating VW's actions had tangible consequences. People died. Environmental regulations are not pesky “red tape” but essential mechanisms for saving our lives.

Reducing emissions by 85% from the shipping sector is a really exciting challenge - beats the pants of driving cars round and round in circles. If we want to introduce the F1 approach into shipping, which some of us are already doing, then fining those that fail to get their vehicles to the start of the race is maybe a good start. You can see it as regulation to be avoided or you can reframe it as a race for the glittering prizes of multiple business benefits.


The Tide is Turning Against the Shipping Sector

Working in the technology and innovation space means I get to attend a lot of conferences. I often hear senior shipping industry representatives arguing that as the sector is ‘the most efficient form of freight transport’ there is no need to change, costs incurred in improving efficiency or adopting renewable energy would have to be passed to cargo owners and they would baulk at the extra financial burden.

I’ve repeatedly heard it said that ‘shipping is the servant of global trade’ and the market seeks low cost freight solutions above all else.

Certainly customers aren’t volunteering to carry extra cost, but we, as an industry, need to be aware that things are changing in the wider global economic world.

Global firms are not waiting for protracted government processes to play out to address the risks of climate change and many international corporations have already implemented internal carbon pricing. M&S, Microsoft, SAP, Walmart, IKEA, Infosys for example – aim to be 100% renewable by 2020. Carbon accounting is a means of driving emissions out of the entire business process to mitigate the risks of dependency on factors outside their control – volatility in fuel costs high among them. It monetises the cost of carbon and in turn means that there is improved financial value in deploying clean energy.

Increasingly firms are aware that “100%” renewable must include supply chains and that by not addressing this essential global business facilitator they expose themselves to the risk of ‘green-washing’. There is a huge brand risk in claiming to be 100% renewable when supply chains aren't, add to that the financial risk of uncertainty in freight costs.

Increasingly global trade seeks commercially attractive low carbon solutions and the shipping sector can’t deliver.

At those same industry conferences I’ve sometimes heard it suggested - publicly by senior leaders - that the inability to police maritime emissions controls might make it financially worthwhile to flout the regulations. The automotive industry had the same idea. But VW’s emission detecting algorithm has been discovered and the impact across the entire automotive sector has been catastrophic. Estimates suggest that the indiscretion has cost VW more than €30bn in fines and the big hit on its share price is coupled with anecdotal evidence suggesting VW are not alone in trying to cheat the system. Consequently the whole automotive sector is reeling. Shipping should take note.

The industry’s customers know that events outside their control are driving their bottom line, and that represents a serious risk to their profitability, and they need to do something about it.

As the servant of global trade shipping needs to urgently respond.

Chilly Reality

Any day now Arctic sea-ice is going to hit its lowest extent for the year, and once again it’s set to be one of the lowest years on record. Already a number of ships have safely traversed the northwest passage. Whilst some shipping benefits from this ice decline recent research indicates that the Arctic’s weakening icy grip will increase the risk of wet extremes over mid-latitude Eurasia and reduce the chances of cold extremes over central and eastern North America. Catastrophic events – floods, heat waves, fires and storms - become more likely. All of this negatively impacts existing eco-systems, production of food and will drastically alter our lifestyles.

With some 90% of world trade transported by sea the maritime industry is a major enabler of globalization and international trade. As a consequence, the industry’s response to the changing world economy is important to the future of growth and development all around the world.

The response to the risks posed by climate change to shipping and the global economy is becoming even more pressing. 7 out of 8 heads of political groups of the European Parliament’s environment committee have written to the Environment Ministers of the 28 EU countries urging them to include international shipping in the upcoming global climate deal at Paris. They wrote:

“To promote increased climate ambition international shipping requires an emissions reduction target.”

Meanwhile technology points excitedly at new discoveries to prove we can solve the awful challenges ahead of us. Recently IHI Corp. says it has been able to grow Botryococcus, a strain of algae that can deliver more than 50 percent of its dry weight in oil, easily, in an outdoor environment. IHI built a 1,500-square-meter facility earlier this year; its breakthrough in outdoor algae growth is significant, because, according to some sources, a hectare of algal culture is capable of producing 137,000 litres of oil annually. That’s equivalent to about 1000 barrels. The average American consumes 22 barrels a year, so now we’ve got 45 Americans who can carry on as usual. But this outdoor land, the hectares where we’ll grow the biofuels, isn’t that already being used to grow food? And with the changing climate threatening to disrupt existing agricultural activity there may not be enough land to go round.