Many of the world’s largest importers and exporters are insufficiently informed about the full implications of the forthcoming new emissions regulations and initiatives to decarbonise the global shipping industry – and the billions of dollars that will be added to freight costs in the future, according to shipping and supply chain consultants Drewry.
Urging shippers to start planning for decarbonisation in shipping and warning of up to US$14 billion in annual extra associated costs, Drewry highlighted that the imperative to decarbonise the global shipping industry “is clear and present”, adding: “Pressure to decarbonise and reduce emissions of greenhouse gases (GHG) is growing in all sectors. In shipping, the International Maritime Organisation’s target to reduce GHG emissions by 50% by 2050 (from a 2008 baseline) will be complemented by regional and national regulations.”
Besides regulatory changes resulting from decarbonisation policies, emissions limits and related taxes, It said there will be enormous technological change in the design of ships and their propulsion systems, with a transition to engines powered by low or zero carbon fuels.
Higher costs
“Overall, the transition towards low or even zero carbon shipping will result in higher costs and we believe that we have put together the first independent cost model to help shippers forecast and quantify additional medium-term direct costs, where they apply,” said Philip Damas, managing director of Drewry.
The European Union will be the first region to enforce ‘carbon taxes’ in shipping via its Emission Trading System, which will penalise users of high-carbon fuels such as conventional fossil fuels and apply not only to shipments within Europe, but also to all shipments to and from Europe, Drewry highlighted.
It said as shipowners look to comply with tighter environmental rules, several ’candidate’ green fuels are being considered, and they will have different implications and costs for shipping lines and for shippers. Read more from Forwardermagazine.com >
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