The Lowdown on the Low-Carbon Shipping Alliance

Amanda CallahanGeneral, Ocean FreightLeave a Comment

The shipping industry has conceived a low-carbon alliance that is meant to take the sustainability agenda to the next level. This is not a surprising move for an industry that has been looking for ways to keep afloat whilst taking into account the realities of depleting energy resources. The Global Industry Alliance (GIA) has a stated objective of supporting any shipper or carrier with the process of transitioning from a high-energy usage model to one that takes into account the need to use natural resources in a responsible and efficient manner. Of particular interest is the process of using low-carbon alternatives in terms of fueling and other related activities.

At the launch ceremony on the 29th of June, 2017, the partners pledged themselves towards finding sustainable energy solutions without endangering the bottom line for their respective organizations. The meeting was an addition to the IMO Intersessional Working Group, which had the specific task of reducing GHG emissions, a sore point for environmentalists who have criticized the industry for failing to live up to the highest standards of sustainability. Kitack Lim, the secretary general of the IMO working group, launched the project by highlighting the need for controlling greenhouse gas emissions. This would be the enduring contribution of the shipping industry towards mitigating the ever-increasing threat of climate change in the world.

What Will the GIA Do?

The United Nations Organization and its constituent partners have developed the Sustainable Development Goals (SDGs) as a compromise solution that allows enterprises to grow efficiently while at the same time paying attention to their responsibilities towards the environment. The shipping industry is, therefore, playing its part by contributing to the achievement of the SDGs. The IMO secretary general was quite clear about the mission:

What we are witnessing today is the formal start of a tried and tested partnership concept which has the potential to boost still further our efforts to kick-start the change that society demands and create a firm, tangible basis to transform the shipping sector for the better.

There are currently 13 organizations that have decided to commit to the working group. The project has direct links to the overarching concept of the GloMEEP initiative. This initiative has been supported by the UNDP and the Global Environment Facility (GEF). The strategic objective of the UN program is to ensure that developing countries are supported as they try to implement new and more efficient ways of shipping goods. The modalities of achieving this objective will include information searches that are able to identify some innovative solutions that can overcome some of the impediments that countries face during the transition into sustainable development.

The program also lends technical and practical support in order to enhance the development and acquisition of new, more efficient technologies. It is anticipated that the operational measures that are required for the changes will be in line with the agreed protocols as per the communique from the working group. Research and development will be key performance indicators in terms of achieving the overarching aims of the GIA group. Many developing countries rely on the maritime sector to engage in international trade. Therefore, they are both a potential source of pollution and also a conduit for reducing greenhouse gas emissions within the sector.

How They Will Create Solutions

The GIA group is not a coercive element, but since international law has not yet agreed on absolute standards, instead, it is a think tank and forum for collaboration. Through dialogue, the various partners will be able to bring their own insights into the development of a comprehensive program for turning the industry into a sustainable sector. The various members will be supported through capacity building as well as through the provision of vital information about best practice. A number of priority areas have been recognized as being critical to the success of the mission that was expressed by the GIA group:

(a) To achieve energy efficiency

(b) To make use of modern technology

(c) To improve operational practices

(d) To share knowledge and experiences

(e) To identity alternative fuel sources

(f) To move the industry towards digitization

Companies in the GIA

Currently, the GIA group boasts the following members:

  1. Winterthur Gas & Diesel
  2. Wärtsilä

iii. Total Marine Fuels

  1. Stena
  2. Silverstream Technologies
  3. Shell International Trading and Shipping Company Limited

vii. Ricardo UK, Royal Caribbean Cruises

viii. Mediterranean Shipping Company (MSC)

  1. Marine Traffic
  2. Lloyd’s Register
  3. DNV GL

xii. ABB Engineering (Shanghai)

How This Affects Shippers

The group anticipates that many more companies will join in the near future. It is expected that those companies that have joined the GIA group will be willing to share their expertise as well as providing actual products that support the stated goal of maritime fuel efficiency. There will be a financial contribution that is designed to support the work of the organizations including monitoring, evaluation, and advice. The program works under the ethos of a public-private partnership in which the various states within the affected regions will support those companies that are working towards the sustainable development goals.

The shipping industry has generally been interested in finding fuels that are considered to be safe, efficient, and sustainable. Currently, there are five alternative fuels that are being explored in terms of their feasibility for the industry. They include methanol, liquid natural gas (or LNG), hydrogen, nuclear energy, and wind. Solar is not yet efficient enough to sustain the energy needs of the industry. Besides, the solution of reducing shipping altogether is not an acceptable solution because it can hinder economic growth.

The GIA initiative is an example of how the shipping industry is engaging in SDG-related activities even without the force of international law. That might provide a useful template for other environmental protection procedures. The example that has been shown by the members is an illustration that sustainability need not be yet another bureaucratic burden imposed by the state. It can become a useful initiative for an industry that is looking to achieve efficiency and more sustainable profits.

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Amanda Callahan
Amanda loves working here and has been with us since 2015. Amanda enjoys writing, decorating, cooking, and she is passionate about spending time outdoors with her family. She left the BBQs of Missouri and a sweet gig at Maersk to join our ranks here in Miami. Her experience in the industry is vast, including Import/Export by Air and Ocean, warehousing, Customs Clearance, and supply chain optimization.

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