Stranded Assets

Examining the detail of the IMO 3rd GHG study we can conclude that despite promising topline figures shipping’s principle emission reduction solution, slow steaming, is a risky strategy as fuel/emissions savings are not ‘locked-in’ through technology developments. As bunker prices fall so the temptation to speed up becomes more compelling which, as a consequence, will see emissions rise again. In the regulatory context this is an increasingly pressing problem. Last week at the Geneva Climate Talks 194 countries agreed to a text that could see a legally binding international cap on emissions from shipping by 2020. This text is due to be ratified at the Paris Climate Change Conference at the end of this year. The IMO will be charged with implementing the framework.

Looking at the impact of the much feared implementation of ECAs the low oil price has softened the initial financial blow somewhat with the net effect about zero. But the real impact will be felt when oil prices rise again as they, “inevitably will” according to Drewry Maritime Research.

All of which makes Hamburg Bulk Carriers MD, Jens von Hansen’s remarks, made at the launch of the first of 10 new 435000 dwt HBC bulkers based on Delatmarin’s ‘B Delta’ efficient ship design, the more pertinent. He said shipping must “get clean” and, “If the shipping industry does not rise to the challenge of developing more fuel-efficient and environmentally friendly ships, it risks large sections of the global fleet becoming "stranded assets".” Looking for inspiration to other global sectors he noted how far behind the curve shipping was and called for a collective effort to develop zero emission ships. Coincidentally the Manchester School of Mechanical, Aerospace and Civil Engineering (MACE) published the results of an industry workshop where the expert collaborators mapped the route to zero emission ships in all sectors by 2050. They concluded: “Clearly there are many barriers to overcome, but at least the timescale and technologies offer feasible hope to be harnessed.”