"Shipping's new beginning - charting the journey to sustainability"
Helena Athoussaki, CEO, Carbon Positive
Shipping International Monthly Review
September 2011 issue

2011 will be remembered as a pivotal year for the shipping industry. After 13 years of protracted discussion and debate, amidst increasing pressure to enter the global effort to reduce CO2 emissions, IMO has adopted the Energy Efficiency Design Index (EEDI) as part of MARPOL Annex VI. Although no doubt a step forward, it is more notable for the progress and shift in attitude that it represents rather than what the regulation in itself can achieve.

EEDI alone will not suffice. Aside from this regulation not being watertight against potential waivers that could see its application being postponed for several years, the sheer volume of new build vessels coming online before EEDI could ever be implemented means that more action must be taken. DNV estimates there to be as much as 15% latent efficiency in the existing global fleet, which is between 8 and 10 years old. These efficiencies cannot be covered by the EEDI, but can be accessed through technical regulation or retrofit technology, for example. After all, reducing emissions is not just about the architecture of the future fleet, as suggested by the EEDI, but also ensuring that actual emissions reduction is achieved.

The pressure to do this continues to build, particularly as the EU looks to deliver against emission reduction targets that depend on achieving a global agreement that incorporates all emitting industries. It is within this framework that Carbon Positive is playing an intrinsic role; supporting shipping in not only reducing emissions cost-effectively, but also in developing a viable emissions management strategy for the longer-term.

There is no short cut to sustainable shipping – it is a journey that we must take together and solid, in-depth analysis is crucial to ensuring that these next, formative steps for the industry's environmental efficiency set us on the correct path. So following careful evaluation of the industry's needs, Carbon Positive has designed a new programme, launching this month, to support shipping in reducing its emissions whilst preparing for future regulation, which most likely will come in the form of a bunker levy or an Emissions Trading Scheme.

Whichever future regulation is agreed upon, taking a phased, managed approach to understanding your own emissions is key. The Carbon Positive programme encompasses three stages; firstly the initial diagnostics of the vessel including a real-time on board energy audit that ensures correct measuring, monitoring and reporting of your emissions. Secondly, the creation of an action plan using tailored-made combinations of technical and operational measures enabling participants to reach specific energy efficiency targets. At the third and final phase, you will be able to employ your offsetting prescription to achieve ongoing, further emission reductions to become carbon positive and eventually, carbon neutral. To ensure transparency, each phase will be verified and certified by a third party; bringing incentives to reward lowered emissions in line with set targets.

Preparing to launch this programme to ship owners has followed a process of in-depth research, and the insight that Carbon Positive has gained has been very valuable. There is a lack of understanding of carbon management and the different market based measures, and as a result we have work to do to engender support for our efforts, which have to date met with some skepticism. Carbon management is currently a grey area for the shipping industry, and the mystery surrounding both global and regional regulatory developments is a factor in this. But this lack of understanding serves to highlight the importance of getting ahead of regulation and whether motivated by the inherent commercial and operational benefits or sheer curiosity, we are seeing a surge in demand for Carbon Positive's consultancy from ship owners and more requests for clarification on this issue.

Looking closer to home, Greek ship owners are now abandoning ambivalence and taking a more active role in participating in the climate change discussion. This may well be driven by the rising cost of fuel – as fuel consumption is directly linked to shipping emissions, it is in the industry's interest to reduce emissions and reap the financial rewards.

Carbon Positive is a Greek company and as such we feel that Greek shipping - unlike other shipping nations with its inherent tradition - may take time and effort to implement new concepts and alter operating strategy. Weary of previous promises from other industries promoting energy efficiency and emissions reduction, perhaps understandably spending money on the latest solutions is yet to be fully embraced. Before spending money on these innovations, we need to lay the foundations with a carbon management strategy for the Greek national fleet – preparation is half the battle.

Moving to a global perspective, there is fierce competition as shipping companies are increasingly looking to streamline costs and reduce emissions in challenging commercial times. And this is no coincidence – the better that you manage emissions now, the greater competitive advantage you will achieve in the future. Putting SEEMP into force through the Carbon Positive programme is one way to empower ship owners and we believe that this can only be a good thing for the industry.

We understand and empathise with the ongoing challenges of fuel costs, freight rates and barriers to accessing clean technology. These factors may present considerable obstacles to change, but we also know that regulation is coming and we must all take responsibility for ensuring that the EU will listen to our voice. There are lessons to be learnt from other industries, such as the complications and political mire that aviation has found itself in. So shipping must be smarter and more prepared.

With further regulation looming on the horizon, the shipping industry must unite, meet the expectations of governing bodies and be responsible for delivering emissions reductions like every other global industry. Ultimately, this journey begins with understanding our own company's impact on climate change and working with experts to develop an effective emissions reduction strategy for the long-term, starting now.

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