Triple Bottom Tuesdays >>> Maersk's $1.4 Billion Investment on New Emission Cutting Ships
Updated: Sep 7, 2021
Picture by: Cameron Venti
Shipping is one of the most important modes of trading and transportation in the world, with more than 5000 active container ships transporting almost 11 billion tons of cargo every year. However, shipping accounts for more than 3% of the world’s total carbon dioxide emission levels, and the levels have been creeping up during the years. The United Nations has pledged to cut the level of air pollution from container ships by half before 2050.
Maersk has already placed an order for eight new container ships which cost $175 Million each and are set to join its fleet by 2024. These new ships can run on cleaner methanol-based fuels rather than the traditional, viscous, carbon heavy petroleum products that container ships usually ingest. “We don’t believe in more fossil fuels” vice president and head of decarbonization Morten Bo Christiansen commented.
Maersk even stated in February that all future vessels will be able to run on carbon neutral fuels. Almost 100 of the largest companies working with Maersk are also re-designing their supply chains to reach zero carbon emission targets. “This is a firm signal to fuel producers that sizable market demand for the green fuels for the future is emerging at speed” said Maersk’s CEO Soren Skou.
Picture by: Dominik Luckmann
However, there are a few hurdles that will need to be overcome in order to comfortably make the transition. Firstly, finding suppliers for the new fuel itself will be a challenge as the industry consumes almost 300 million tons of oil every year. Additionally, the cost of re-engineering the design for the ship’s engines to run on both methanol and conventional oil costs approximately 10-15% of the total cost of the ship itself.
Despite these challenges, Maersk isn’t the only company who is transforming its fleet to a more environmentally friendly one. Euronav, one of the world’s leading oil tanker companies, has ordered construction of new ships that can run on ammonia or liquified natural gas, and Cargill Inc. has had a different approach to reducing emissions on their ships by planning to attach wing sails to some of its fleet.
September 07th 2021 | 9:45 AM