Collaboration key to green shipping corridors: APM

Market: Biofuels, Oil products
14/03/24

Collaboration between countries and stakeholders willing to find sustainable decarbonisation solutions is key to the success of green shipping corridors, said speakers at the Asia Pacific Maritime (APM) 2024 conference in Singapore.

Singapore has initiated green shipping corridors with the aim of helping energy transition in the maritime sector, said the assistant chief executive (industry and transformation) of the Maritime Port and Authority of Singapore Kenneth Lim, speaking at a keynote panel during the 13-15 March event. This follows the signing of an initial deal between Singapore and Australia on setting up the Green and Digital Shipping Corridor. There are an estimated 44 green shipping corridors that have been announced globally, most of which are at a planning stage.

The main deadlock to making green corridors operational remains, as it is unclear who will bear the burden of higher fuel costs, given the large price gap between conventional and alternative marine fuels, said the chief technology officer for energy and fuels at Denmark's Mærsk Mc-Kinney Møller Centre for Zero Carbon Shipping Torben Norgaard.

This gap can be filled either through a concept like the Zero Emission Maritime Buyers Alliance, a cargo owner-led alliance of major multinational companies working together to accelerate maritime shipping decarbonisation, or through regulation to allocate increased costs, such as putting a price on carbon.

The green corridors that have moved ahead the most are those where roles and responsibilities including cost allocation are clear and there is trust between stakeholders, such as in the EU, Norgaard added.

"Right now green corridors are primarily in the initiation and planning stages with operational green corridors on the horizon," said the head of decarbonisation at the UK-based Sustainable Shipping Initiative Andreea Miu. "Getting to that stage will depend on stakeholders working together to make concrete investments to enable the corridor."

Developing bunkering infrastructure, building or retrofitting vessels that can run on the chosen alternative fuels, along with the training of seafarers in the handling of new fuels, are some of the initiatives that the investments should be aimed at, Miu added.

But more importantly it is a "coalition of the willing who are willing and able to work together and operate in a very specific economy where they avoid too much interference", that is needed to enable the green shipping corridors, Norgaard said.

Looking ahead

The green corridors could help shipowners as fuel selection also remains a key hurdle, with unresolved safety concerns over alternative fuels like ammonia, APM panelists added.

It is important to consider how the volumetric energy density of alternative fuels is "way less" than that in fossil fuels, which would result in shipowners having to decide between carrying more fuel or bunkering more, and looking for more locations where they can bunker, said the chief technology officer of the Singapore-based Global Centre for Maritime Decarbonisation Sanjay Kuttan.

The next "super corridor for green fuels" could emerge between south India and east China's Ningbo/Zhoushan, where the two countries' collective 3bn population will create significant demand for vessels to do transshipments there, Sanjay said

By Mahua Chakravarty, Sarah Giam and Lauren Moffit

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Viewpoint: European HVO demand to rise in 2025

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Viewpoint: Europe’s refiners eye support from closures

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