Handing cargo owners control of decarbonizing their supply chains

By Katarin Van Orshaegen, Commercial Lead at GoodShipping

Special to The Digest

Left unchecked, emissions from international shipping could account for more than 15% of the world’s total by 2050. That’s not just a challenge for the industry itself to become more sustainable, but for wider society. Encouragingly, Katarin Van Orshaegen, Commercial Lead at GoodShipping, explains that solutions already exist to move supply chains towards a zero-carbon future.

Shipping is essential to lives and livelihoods around the globe, transporting vital food, medicines, and energy to individuals, businesses and communities. Approximately 90 per cent of the world’s traded goods are moved by ship, and the total value of ocean freight trade exceeds US$14 trillion each year.

However, the shipping industry is a major contributor to the global warming problem, contributing around 3% of the world’s Greenhouse Gas (GHG) emissions. If it were a country, shipping would rank as the world’s sixth biggest CO₂ emitter. Meanwhile, the pressure to decarbonise the sector is growing, both in breadth and urgency. In the last few months, the International Maritime Organization (IMO) and the European Union (EU) have adopted regulations aimed at significantly reducing emissions from shipping by 2030. Perhaps most importantly, shippers, cargo owners and consumers are increasingly demanding sustainability, a reality which is reflected in buying, investing, and chartering decisions.

Meeting growing expectations from legislators and society will require all actors to adopt a fresh mindset. We must have the courage to make the right decisions today so that we reduce emissions and improve the sustainability of our supply chains to support a better future.

Immediate impact

For cargo owners and shippers, the good news is that solutions already exist to make sustainable shipping a reality, both in the short and in the long term. The tools already exist to start taking control of our carbon footprints; the challenge is to choose the right solutions.

Many of the technologies and fuels of the future are still under development, and time will be needed to deploy them at the scale required to fuel the 56,000 ships that transport 11 billion tonnes of goods around the world each year.

But the picture is not all dark, as there are opportunities for business owners to reduce their emissions now with sustainable biofuels. Most cargo ships today use fossil fuels which can be easily replaced, in any proportion, with 100 per cent renewable biofuel. This is the first and most obvious role that biofuels can play in reducing carbon emissions, and it is an option that GoodShipping is making available to all cargo shippers.

How GoodShipping transforms supply chains

With acknowledgment that the tools and solutions exist, GoodShipping’s ‘carbon insetting’ solution hands control to cargo owners to influence how they transport their goods. In so doing we can accelerate the energy transition in shipping from a macro perspective.

GoodShipping allows cargo owners the choice to ship part or all of their cargo in a fossil-free way. Once the owner has determined the amount of cargo they wish to transport sustainably, we organise a biofuel “drop-in” directly with a cargo owner to match the fuel required to transport that amount carbon-neutrally. The use of biofuel results in an immediate sustainability boost for the receiving ship, for the shipper’s own corporate credentials, and for the environmental demands of their customers.

This is made possible thanks to the mass balance principle, which recognises that all CO₂ is emitted in the same atmosphere and that what truly matters is the net result. Our strict accounting principles ensures that all carbon reductions are only claimed once, by the cargo owner who has paid for the biofuel.

The key benefit of carbon insetting is that it enhances the shipper’s own supply chain – with money spent on reducing emissions remaining in the sector, where it can help accelerate the development of new technologies, innovations and sustainability projects that will benefit the whole industry. There is no need for the cargo owner or shipper to change their supply chains to achieve greater sustainability, as they are working within their existing network to take this action and bring about change.

Collaboration is key

We have seen this snowball effect with leading brands spanning the freight forwarding, retail, food, and automotive industries (to name a few) that have partnered with us over the past three years. The world’s first delivery of sustainable biofuel to a container ship took place in March 2019, when GoodShipping and IKEA partnered with shipping company CMA CGM and the Port of Rotterdam to bunker CMA CGM White Shark with GoodFuels’ Bio-Fuel Oil. This was followed by multiple bio-bunkerings with partners from a variety of nations and sectors, which all had a tangible impact by reducing the amount of carbon emitted into the atmosphere.

Most recently, we are seeing a number of cargo owners come together for a bunkering of sustainable marine biofuel to cut around 3,800 tonnes of emitted CO2 – equivalent to a journey between Rotterdam and Glasgow – host city of the COP26 summit. Although these cargo owners, including Yogi Tea, Tony’s Chocolonely, Nine&Co, and Matsen Chemie to name a few, span a wide range of nations and industries, they are united in their ambitions to make instant climate impact.

GoodShipping’s experience demonstrates the power of collaboration, and also proves the scalability, sustainability, and technical compliance of sustainable marine biofuel. It shows the commercial viability of carbon insetting, and further proves that there is a realistic option for curbing GHG emissions from shipping available today. In today’s interconnected and interdependent world, collaboration will be essential to solve shipping’s sustainability challenges, and create a better future for all.