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Posted on April 5, 2023 10:17 pm by
David Connolly
The International Maritime Organization (IMO) has pledged to respond to industry concerns regarding the criteria and implementation of the Carbon Intensity Indicator (CI) rating system after it is finalized this year. With this in mind, maritime executives should expect CII to be more influential as enforcement mechanisms and unintended consequences are addressed.
One such unintended consequence of the regulation now in effect is that the industry is slowly focusing on steam to improve CII standards. Relying solely on slow steaming and taking a largely static view of CII norms is a big risk. While it is true that slow steaming can improve CII ratings, it is by no means a silver bullet and certainly has its drawbacks.
Ships will slow down, which means global fleets will have to expand to carry the same amount of goods. Ultimately, this will increase the life-cycle emissions of the global fleet – so slow steaming is at odds with CII’s environmental objectives. Once widely known, this will make the IMO encourage other solutions to achieve A and B levels, which themselves will grow as a pedigree symbol among various shipowners.
While regulatory penalties for non-compliance with CII are currently minimal, the business impact can still be significant. For example, if freight rates are high, those who can move quickly while maintaining a favorable CII level will have a competitive advantage. Additionally, as more customers push to ship carbon-neutral goods, an advanced CII rating can be a license to operate for reputable freight forwarders.
Finally, vessel efficiency and charter rates, emissions and profits, are only set to become more interconnected. For those who recognize this obvious direction of travel and the need to look beyond slow steam for real solutions, cleantech is an obvious place to start the search.
Technology ready for recovery
Clean technologies such as air lubrication systems offer a reasonable opportunity to improve ship efficiency, reduce fuel use and reduce OPEX and emissions. Additionally, fuel economy becomes even more important when more expensive, less energy-dense alternative fuels enter the mix.
If the shipping industry is to complete the decarbonisation puzzle, improving the efficiency of large fleets should not be overlooked. While newbuildings remain a key piece of the puzzle, building all the new ships required simply requires emissions. With that in mind, most, if not all, ship owners try to retrofit some existing fleet to improve efficiency.
Having said that, it can be challenging to determine which clean technologies or technologies provide real and proven efficiency improvements to existing fleets. So, what should ship owners look for in clean technology?
The first step is to determine whether a specific clean technology upgrade to a specific vessel is feasible from a technical perspective – to ensure that the payback equation for the remainder of the vessel’s life cycle is properly understood.
The next step is to ensure that a solution can be installed smoothly. Many clean technologies can be installed during the ship’s scheduled drydocking, increasing transaction time. Looking at the entire life cycle and total cost of ownership is key to technology. Systems that have minimal impact on the vessel’s equipment footprint and are easy to use and maintain should be valued.
Effective planting capacity depends on flexible supply chains. For example, at Silverstream Technologies, we focus on supply chain resilience, which requires strong relationships with diverse suppliers as well as OEMs and local entities. This allows us to deliver systems on time and on budget within six months.
Certified emission data
As with most strategic decisions in the modern shipping industry, clean technology choices must be supported by data. Proven emission reduction claims and case studies covering each specific fleet type are essential. At Silverstream, for example, when we look at hydrodynamics, we know that our technology works well for almost anything with large, flat bottoms, such as LNGCs, cruise ships and VLCCs.
In general, ship owners should be suspicious of clean technology vendors who lack transparency and do not clearly publish performance data for their technology. Ship owners and operators can help move the data conversation forward by bringing solid operational data and bringing the ship’s operational profile to the table.
Ship owners and operators should seek independently verified emissions savings. This is often achieved when technology goes through systematic testing steps in collaboration with class communities. Technologies that can be turned on and off can provide an easy way to accurately measure real-life work performance.
It is also important to consider not just a single optimization point, but the entire fleet’s emissions reduction data, as well as how the fleet would normally operate for that trip. It is important to explore how the new technology interacts with other devices and clean technology on board and to support this with data and simulation where possible. Some clean technologies complement each other well and lead to high efficiency gains, while others can hinder each other. Putting all these data points into the collection makes the insights more realistic and accurate.
Shipowners, large and small, from all over the world, can take advantage of the opportunities offered by the industry’s decarbonization transition to gain a competitive advantage. If you do your due diligence and consider the key issues outlined above, you can be decisive, take the decarbonization bull by the horns and install the right clean technology to make an impact today.
David Connolly is the Chief Technology Officer of Silverstream Technologies.
The opinions expressed herein are those of the author and not necessarily the views of Maritime Executive.
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