We're Not Happy With Decarbonisation Progress at the IMO: Maersk

Maersk said the shipping industry cannot risk waiting for action on decarbonisation from the IMO. Image Credit: Ship & Bunker

Shipping giant AP Moller-Maersk, the world's largest bunker fuel consumer and aspiring early adopter of alternative fuels, says it is dissatisfied with the International Maritime Organization's progress on decarbonisation regulations.

Maersk is currently one of the largest users of oil of any kind in the world. But the company has committed to buying only vessels capable of running on zero-carbon fuels from now on, and expects to have its first carbon-neutral vessel running on green methanol in 2023.

The IMO has set an aspiration of cutting the shipping industry's carbon emissions per transport work by 40% from 2008's levels by 2030, and halving total greenhouse gas emissions by 2050, but has yet to introduce market-based-measures to drive the shift to lower-carbon fuels. The UN body is set to discuss some measures next month, but little firm action at the global level is expected for several years.

"We're not very happy with the progress at the IMO level; we think IMO needs to speed up," Jakob Sterling, head of technical innovation at Maersk, said in a webinar hosted by Lloyd's List on Wednesday.

"Until the IMO gets its act together, or rather the member states of the IMO, we will have to work with regional schemes to make sure that they can also have a meaningful difference in creating a level playing-field for shipping where green fuels are more on par with black fuels on the cost side.

"We need to get green methanol production off the ground, other green fuel productions off the ground, and that is just going to be a lot easier if the price gap between the green and the black fuels is reduced, at least in some areas."

Waiting for IMO

The shipping industry should not wait for action from the IMO, Sterling argued, as the reputational risk from being seen not to act on decarbonisation could ultimately limit global freight demand.

"We cannot depend on the IMO to set the pace for this; we need to go much faster than what the IMO suggests, and what the IMO can reach consensus on," he said.

"The biggest risk for us is going too slow.

"If we decarbonise too slowly, the whole concept of global trade, where you produce in one end of the world and consume in the other end of the world, might be challenged by consumers in five, ten, 15 years' time."

LNG Bunkering is 'Borderline Greenwashing'

Sterling also delivered a ramping-up of Maersk's longstanding hostility to LNG bunkering, labelling it 'borderline greenwashing'.

Asked if LNG had a role in the decarbonisation of shipping, Sterling said "No, we don't think so."

"It's being portrayed as a transition fuel -- well, a transition fuel towards what?" he said.

"Why would we need to install very expensive infrastructure and invest in assets that run on LNG, when the well-to-wake lifecycle greenhouse gas emissions at best are just marginally better than what we use today?

"Clearly there's a lot of oil companies out there that have a lot of LNG that they need to get rid of, and therefore there might be a good commercial case for LNG for some players -- but it's a commercial decision, it's not a decarbonisation decision.

"And I think it is borderline greenwashing to call LNG a transition fuel towards the decarbonisation of shipping."