Decarbonization: Bridging between research and action

In an interview with Maritime Fairtrade, James Forsdyke, managing director of Lloyd’s Register (LR) Maritime Decarbonization Hub, shares more about the status of the industry’s decarbonization efforts.

LR Maritime Decarbonization Hub, a thought-leadership non-profit organization which steers with information, insight and knowledge, has a new direction in leading the sector towards a decarbonized future. The compass points include costs, benefits, opportunities and risks which come with diverse green transition tracks. 

James Forsdyke, managing director, Lloyd’s Register Maritime Decarbonization Hub. Photo credit: Lloyd’s Register Maritime Decarbonization Hub

What immediate and long-term issues do you observe the industry facing? 

One thing that has really been on my mind is what putting human safety first means to the industry as a whole. We all recognize that these chemicals, such as ammonia, methanol, and hydrogen, when deployed as maritime fuels, introduce new risks and hazards to the shipping system. That is why we now need to develop both a safety framework and a safety culture to support it.

Historically, our industry is system-led; that means it is a system designed to efficiently perform its objective, and then train the user to safely use that system. As we start to grapple with the quantum of challenging fuels that exhibit new types of toxicity, handling and flammability characteristics, we should start adding human centricity into our design philosophies. The most important one is designing a system that is safe to use. As a baseline, we should pivot to this human centricity for high-hazard system interfaces and if possible, for the entire ship and technology design development environment. 

We could use an anecdote comparing a commercial airline cockpit with an ammonia bunkering station on a ship. The cockpit is the same, no matter the airline, and the pilot’s certification means they are fit to fly in that cockpit. They do not read a manual when signing onto the aircraft and they do not have a few days’ handover with the outgoing pilot. 

Why shouldn’t the ammonia bunkering station be standardized and designed to minimize hazard, so that the STCW (Standards of Training, Certification and Watchkeeping for Seafarers) certification for the crew is sufficient for them to operate safely? Likewise, why can’t the principle human or system interfaces be standardized so that the seafarer does not need to learn a bespoke system each time they sign on? 

We have a window today to integrate this type of learning in human-centered safety which distinguishes us from other industries. Therefore, we should explore how we could best leverage this mindset to keep the maritime workforce safe as the industry transitions to new fuels.

How can LR Maritime Decarbonization Hub step up to reshape the transformation to a green industry? 

The Hub, and other impact-oriented non-profits organizations, are uniquely positioned to contribute to the sector’s energy transition because we bridge the gap between research and action. For us to succeed with climate goals as an industry, we have to develop, implement and accelerate the deployment of new thinking into our established industry. That typically can be a slow process as ideas mature from academics and theory to practice and application. 

At the Hub, our action-oriented programs purposefully bridge those gaps to connect industry action with new thinking. The fact that we are non-profit means that we are not driven by commercial advantage. Instead, we do it to deliver impact. In doing so, we generate thought leadership which incorporates new ideas and learned experiences. We feel that the insights we offer the industry are quite robust, tested, evidence-led, and most importantly, actionable.

The Hub recently launched a collaborative initiative among energy ministers in Africa and Asia to develop and finance clean energy projects. Tell us more.

The Maritime Fuel Supply Dialogues series focuses on bringing together stakeholders across energy and transport sectors to scale fuel supply development across Asia Pacific and Africa. This is to support regional maritime decarbonization. The initiative aims to unlock the potential for clean and sustainable fuels, especially hydrogen-based fuels, and to foster a thriving blue economy.

The Dialogues kicked off with the first roundtable discussion on 16 April 2024 during Singapore Maritime Week. It was hosted by the Ocean Stewardship Coalition of the United Nations Global Compact with content partner, the Hub. 

The initiative aims to link existing national hydrogen strategies with emerging shipping demands for hydrogen-based fuels, untapping opportunities that countries across Asia Pacific and Africa are well positioned to explore. Zero-emission shipping requires a joined-up approach across the energy and transport sectors, which is why it was important to have both energy and transport ministries in attendance at the inaugural roundtable. 

During the roundtable, ministries were brought to discuss the opportunities of regional cooperation to accelerate hydrogen fuel supply development. The need for policy and financial levers and mechanisms to create the necessary enabling conditions to mobilize capital were also part of the conversation. 

This is an opportunity to explore some of the financing challenges unique to countries in the region, to find ways of de-risking projects and aggregating demands across the region which can support shipping’s decarbonization.

These were the participating ministries in the inaugural Asia Pacific and Africa dialogue (in alphabetical order):  

India, Ministry of Shipping, Ports and Waterways; Kenya, Ministry of Mining, Blue Economy and Maritime Affairs; Namibia, Ministry of Mines and Energy; Namibia, Ministry of Works & Transport; Oman, Ministry of Transport, Communications and Information Technology; Philippines, Maritime Industry Authority, Department of Transportation; Republic of Korea, Ministry of Oceans and Fisheries; and Singapore, Ministry of Transport. 

What are the clean energy needs in the two regions that the initiative will meet?

The International Energy Agency (IEA) reported only four percent of potential low emission hydrogen production had taken a final investment decision (FID). This low FID rate and a large proportion of the projects announced, which are still in early stages of development, require actions to kickstart the scale up in fuel supply infrastructure development.

Cost competitiveness of fuel supply development is dictated by the cost of capital and other perceived geographical risks, so clear and supportive policy signals are needed to realize the infrastructure development opportunities across Asia Pacific and Africa, particularly where access to capital is limited. 

National and regional policy and carbon pricing frameworks are emerging in the Global North, including Europe’s Fuel EU Maritime policies and the US Inflation Reduction Act tax incentives in place. Meanwhile, Asia Pacific and Africa hold immense potential for renewable energy development, and these regions require supportive frameworks and policy alignment to similarly realize the new market opportunities from shipping’s decarbonization. 

Through the Maritime Fuel Supply Dialogues series, we are aiming to enable more collaboration among national governments – from both fuel producing countries and maritime demand centers – to uncover regional synergies and co-benefits across Asia Pacific and Africa. 

How can the transition to a sustainable blue economy be feasible, manageable, and realistic?

From a shipping’s perspective, a core principle of transitioning to a sustainable blue economy is to ensure that maritime stakeholders prioritize investment decisions that support the maritime energy transition away from fossil fuels. However, at the same time, they must be able to deliver local environmental and community benefits in alignment with the global temperature target of 1.5 degrees Celsius set by the Paris Agreement.

First movers in maritime decarbonization will inevitably face a significant cost gap, as zero emission ships will be more costly to operate than fossil fuel-powered ships because zero carbon fuels are going to be costlier. A recent report by UNCTAD (United Nations Conference on Trade and Development) indicates that scaling up fuel production, distribution and marine bunkering infrastructure to supply 100 percent carbon-neutral fuels by 2050 would require an estimated annual investment of between US$28 billion to $90 billion.   

The energy transition that the maritime industry faces today is distinct from earlier transitions – the transition to coal-power steam ships in the 1800s, and the transition to diesel fueled engines in the second half of the 20thcentury. The next energy transition will not be driven solely by technological advances or economics, but by an environmental imperative, increasingly underscored by social pressure, policy and regulatory demands to reduce emissions. Decisions are being made today without commercial certainty, but in the knowledge that regulations, rather than economics, will push change forward. 

For the transition to be both economically, environmentally and socially feasible and realistic, the industry must work together in partnership. A concerted effort between private and public partners can help to reduce these feasibility gaps for zero-carbon fuel deployment and de-risk investments through joint ventures and alliances. But the scale of the challenge means that decarbonization must involve the entire supply chain of shipping – from fuel suppliers scaling up production of zero-carbon fuels and manufacturers designing new engines, to port operators investing in new facilities and bunkering services for zero-emission vessels. 

We envision ports to play a crucial role in ensuring shipping decarbonization efforts are done in a way that has a positive impact on port communities. In view of these considerations, the LR Maritime Decarbonization Hub partnered with Environmental Defense Fund (EDF), in collaboration with Arup, to develop a Sustainable First Movers Initiative Identification Tool, a system that scores a port’s potential to produce and bunker electrofuels while delivering local environmental and social benefits to the coastal communities of the port.  

The preliminary phase of the Sustainable First Movers Initiative Identification Tool analyzes 108 ports in the Indo-Pacific region according to five criteria including land suitability, air quality, renewable energy surplus, economic resilience and ship traffic. This approach sets the base for a sustainable regional transition to a blue economy which considers the impacts on port-side communities and prevents regions in the Global South from lagging behind.

Photo credit: iStock/ Kenstocker

The best maritime news and insights delivered to you.

subscribe maritime fairtrade

Here's what you can expect from us:

  • Event offers and discounts
  • News & key insights of the maritime industry
  • Expert analysis and opinions on corruption and more