Climate-neutral maritime transport – a business choice or a survival strategy?
In recent years, more and more haulers have started to look at environmentally friendly transport and are moving towards the goal of becoming climate-neutral, or at least reducing the negative environmental impact of their operations. Company marketing teams are working hard to show their concern for the future and to highlight this as a noble step. But is it? Is reducing CO2 emissions a free choice for maritime freight carriers, or is it a strategic plan for survival?
According to the latest UN estimate, cargo ships carry 10.7 billion tones of cargo in the oceans each year. Almost all carriers have so far used fossil fuels, which currently account for 2% -3% of global carbon dioxide emissions. This means that if the shipping industry were a country, it would be the sixth largest emitter of carbon in the world. If shipping companies do not take additional measures to reduce emissions in the coming years, the sector’s CO2 emissions are projected to increase by 50-250% by 2050.
Carbon emissions are one of the main causes of adverse climate change, including rising average air temperatures and increasing rainfall, which in turn is accelerating the melting of ice, increasing salinity and water levels in water bodies, and increasing coastal erosion.
To prevent the world from reaching a climate crisis, many industries, including logistics, are looking for effective ways to reduce their negative impact on nature.
The goal is to become a carbon neutral industry
At present, maritime freight companies are ambitiously moving towards the goal of becoming a carbon-neutral industry. However, this is not a one-day issue, and carbon emissions need to be reduced gradually to reach this goal. The International Maritime Organization (IMO) has set a target of reducing total international GHG emissions from international shipping by at least 50% by 2050 compared to 2008.
The decarbonization of the shipping industry will not only help reduce the sector’s negative impact on the environment but will also help to achieve other climate-related goals, such as the switch to renewable fuels by 2050. The Environmental Defence Fund estimates that this could boost up to $ 6 trillion in renewable energy infrastructure worldwide.
The first steps towards the goal
The Danish freight company Maersk has taken the first serious step towards decarbonization. The company has announced the purchase of eight cargo ships that will run on methanol, reducing CO2 emissions by 1 million tones. This decision follows the carrier’s commitment to become a fully climate-neutral company by 2050.
Maersk is not the only industry to start realizing its ambitions to become an environmentally friendly company. Similar decisions have been made by other companies, such as DHL and UPS, which offer their customers the option of delivering orders using sustainable fuels for a fee. Amazon, meanwhile, signed a commitment in October with companies such as Ikea and Unilever to make sure that by 2040 they could only transport goods on carbon-free ships.
Choice or necessity?
Over the last five years, the number of players in the logistics, freight and shipping sectors that are moving towards a greener future is growing, and the above companies are just some of the players in the logistics sector who have already made their first choice in favor of decarbonization. That, of course, is to be welcomed, but before companies are praised and put on the podium, it would be important to understand their motivation. Here are some facts that can help you find the answer to this question!
A study on corporate social responsibility conducted in 2017 found that consumers today increasingly choose companies that adhere to the principles of sustainable business. 87% of people are more positive about companies trying to reduce the environmental impact of their industry in various ways. In turn, 88% of respondents trust service providers to contribute to the fight against social and environmental issues. The research data show that the position of companies on environmental issues is especially important for the younger generation of adults and millennials. This means that promoting an environmental awareness plan is an effective strategy to increase customer purchases, gain trust and maintain loyalty.
Account must also be taken of the fact that the goal of making shipping an environmentally friendly industry is being set not only by companies or leading associations, but also by countries. For example, from 2030, Norway has committed to purchase only those cargo ships that will have access to zero-emission technologies. Norway’s climate strategy also provides for an international ban on the use of non-climate-neutral fuels from 2050 onwards. This, in turn, could mean that the demand for water transport that is not fueled by this type of fuel will fall sharply over the years.
Under the EU Emissions Trading Scheme, which will be phased starting 2023, the European Union (EU) will also start regulating shipping emissions. In addition, legislation is being proposed requiring shipping companies to pay for the carbon dioxide emissions they emit when traveling to, from and between EU ports.
These are just some of the facts that make it clear that the noble step towards climate-neutral action is not only a free choice of companies, but also a strategic step in gaining customer loyalty and surviving at a time when tackling the climate crisis is a top priority. As the Latvian poet Rainis wrote: “Only that which remains in constant change, shall persist!”
Author: Roland Peterson, logistics expert