Being asked to think about how to invest $1bn into a sustainable and profitable shipping business left me intrigued. After all, it is not often you are offered a “blank cheque” — albeit fictional — for a project one feels passionate about.
This article is part of a series written by people across shipping in response to this question about how to deploy a hypothetical TradeWinds Sustainable Shipping Fund:
How, where and why would you invest $1bn for the best return in sustainable shipping, as the industry grapples with the need to cut carbon emissions, improve efficiency and keep cargoes moving in a world facing multiple economic and political challenges? The investment will be made now and ideally held for the next seven years to the end of the decade. As an added bonus, give one policy or regulation you would like to implement from 1 January 2023 to benefit shipping?
While excited, I was also torn by how I would approach this. As an industry, we account for 2.1% of global CO2 emissions, and I therefore feel a clear responsibility to help create a sustainable future.
As an organisation, we are part of DP World, and we are investing up to $500m to cut CO2 emissions from our operations by nearly 700,000 tonnes over the next five years. This is part of our commitment to the Green Shipping Challenge announced at COP27 and aligns with our aim to become a carbon-neutral enterprise by 2040 and net-zero on carbon by 2050.
Balancing these commitments with our corporate goals of remaining a viable business is crucial. I need to think about the return on my investment.
In my personal opinion, there are three focus areas that should be explored further. We need to look at the types of energy we use, we need to manage our operations with the highest level of efficiency and we need to explore carbon capture further.
The primary part of my investment would therefore go into research and development focused on technologies that look at all three areas holistically.
Alternative fuels are already available. LNG is just one of the options that P&O Maritime Logistics is using. And there are more alternatives, including biofuels, hydrogen, ammonia and fuel cells, that have the potential to be scaled up and for widespread adoption.
By looking at alternative types of energy, we would want our investments to be a driving force behind Green Corridors — shipping routes exclusively dedicated to vessels that use alternative fuels. Emissions can be reduced in other profound ways. Smart, innovative offshore solutions can help mitigate CO2 emissions across our global operations. Advanced technology will have to play a crucial part in creating those efficiencies.
Often overlooked is the capture of CO2. A lot more needs to be done in the way we treat and control “waste of energy”. In the immediate term, investments would likely go to towards post-combustion capture solutions. In the medium to longer-term, we would explore pre- or oxyfuel combustion answers, which means we would remove the carbon from the fuel before it is being used.
However, to drive real change, we need to look at these areas holistically and bring all stakeholders together for a meaningful dialogue.
