The shipping industry transports 90% of the goods we use and consume – so why do we know so little about it?
This article originally appeared in Blue & Green Tomorrow’s Guide to Sustainable Transport 2014.
The shipping industry transports around 90% of all imports to the west. It has quadrupled in size since 1970, with around 100,000 vessels now working on the seas globally. Maersk – just one shipping company, but one of the largest – has annual revenues that match technology giant Microsoft, bringing in around $60.2 billion (£36.7 billion). Despite this, the industry is often invisible.
In 2009, Sir Jonathon Band, the First Sea Lord, accused politicians of “sea blindness”. Although his comments were chiefly in response to the government’s cuts to the defence budget, the sentiment can also be applied to the industrialised west – according to the journalist and author Rose George. In a December 2013 TED talk, George said, “Perhaps the general public thinks of shipping as an old-fashioned industry, something brought by sailboat with Moby Dicks and Jack Sparrows. But shipping isn’t that. Shipping is as crucial to us as it has ever been.”
After becoming intrigued by how the industry underpins western consumer civilisation, she decided to join a 21-strong crew on a journey from the UK to Singapore. Whilst aboard, George integrated with the ship’s crew, finding out about some of the key issues they face every day. Despite the grave threats posed to the shipping industry from piracy, many workers simply get on with the job at hand, providing a vital link to the economy – and ensuring that goods get from factory to shop floor.
She was told that the black clouds of smoke bellowing from the ship’s chimneys were due to bunker fuel – the dregs of the product from refined fuel. George added, “Shipping has very tight margins. They want cheap fuel so they use something called bunker fuel… the dregs of the refinery, or just one step up from asphalt.”
Compared to the aviation industry, ships emit around a thousandth of the greenhouse gases that contribute to global warming, and around a tenth of that from trucking. However, to put that into context, there is so much shipping going on in the modern world that it contributes to 3-4% of the planet’s total emissions.
The Carbon War Room, co-founded by British entrepreneur Richard Branson, says that shipping is responsible for more than a billion tonnes of carbon dioxide emissions every single year. The 15 largest vessels alone account for as much nitrogen oxide and sulphur oxide as the world’s 760 million car (though the concentration of these gases in car fuel is, admittedly, much lower than in ship fuel).
Despite being one of the biggest polluters (if the shipping industry were a country, it would rank number six for pollution), the industry began to change its attitude to fuel consumption in 2007, but this was not something that was done with climate change in mind.
Amid rocketing fuel prices, shipping firms knew that in order to keep margins at their highest, they needed to use less fuel. As a result, many adopted the practice of ‘slow steaming’, where they cruise at speeds below their maximum. This, of course, reduced emissions, but initiatives have since been launched in order to change the conversation around fuel.
Speaking to Blue & Green Tomorrow, George says, “I think that initially the compelling factor was cost: fuel is expensive, so if you can build more efficient engines or propellers then that will be accepted by shipbuilders and owners. I think the dialogue has changed now, and there is, at least publicly, acceptance that shipping needs to address its emissions.”
Maersk has invested around $3.8 billion (£2.3 billion) in commissioning the world’s most energy efficient ships, the Triple-E Class series. It completed six vessels throughout 2013, with a further five under construction and to be launched this year, and another 10 in the pipeline. But the main issue, according to George, is the remaining 100,000 ships out there still burning bunker fuel with inefficient engines.
The Carbon War Room estimates that by retrofitting old and inefficient ships with new technologies, such as harnessing wind power, energy recovery, hull optimisation, air lubrication and propeller enhancements, the industry can save around $70 billion (£42 billion) every year and slash carbon dioxide emissions by around 30%. The problem with such initiatives is that ship owners don’t have to fork out a single penny extra for the emissions they pollute – because ultimately, the total bill is footed by society and the planet. Only by engaging everyone in this debate, from consumers to retailers; shipping giants to policymakers, can we align the industry’s apparent operational invisibility with an invisible carbon footprint.
Photo: lotsemann via Flickr
Responsible Energy Investments Could Solve Retirement Funding Crisis
Retiring baby-boomers are facing a retirement cliff, at the same time as mother nature unleashes her fury with devastating storms tied to the impact of global warming. There could be a unique solution to the challenges associated with climate change – investments in clean energy from retirement funds.
Financial savings play a very important role in everyone’s life and one must start planning for it as soon as possible. It’s shocking how quickly seniors can burn through their nest egg – leaving many wondering, “How long your retirement savings will last?”
Let’s take a closer look at how seniors can take baby steps on the path to retiring with dignity, while helping to clean up our environment.
Tip #1: Focus & Determination
Like in other work, it is very important to focus and be determined. If retirement is around the corner, then make sure to start putting some money away for retirement. No one can ever achieve anything without dedication and focus – whether it’s saving the planet, or saving for retirement.
Tip #2: Minimize Spending
One of the most important things that you need to do is to minimize your expenditures. Reducing consumption is good for the planet too!
Tip #3: Visualize Your Goal
You can achieve more if you have a clearly defined goal in life. This about how your money can be used to better the planet – imagine cleaner air, water and a healthier environment to leave to your grandchildren.
Investing in Clean Energy
One of the hottest and most popular industries for investment today is the energy market – the trading of energy commodities. Clean energy commodities are traded alongside dirty energy supplies. You might be surprised to learn that clean energy is becoming much more competitive.
With green biz becoming more popular, it is quickly becoming a powerful tool for diversified retirement investing.
The Future of Green Biz
As far as the future is concerned, energy businesses are going to continue getting bigger and better. There are many leading energy companies in the market that already have very high stock prices, yet people are continuing to investing in them.
Green initiatives are impacting every industry. Go Green campaigns are a PR staple of every modern brand. For the energy-sector in the US, solar energy investments are considered to be the most accessible form of clean energy investment. Though investing in any energy business comes with some risks, the demand for energy isn’t going anywhere.
In conclusion, if you want to start saving for your retirement, then clean energy stocks and commodity trading are some of the best options for wallets and the planet. Investing in clean energy products, like solar power, is a more long-term investment. It’s quite stable and comes with a significant profit margin. And it’s amazing for the planet!
What Should We Make of The Clean Growth Strategy?
It was hardly surprising the Clean Growth Strategy (CGS) was much anticipated by industry and environmentalists. After all, its publication was pushed back a couple of times. But with the document now in the public domain, and the Government having run a consultation on its content, what ultimately should we make of what’s perhaps one of the most important publications to come out of the Department for Business, Energy and the Industrial Strategy (BEIS) in the past 12 months?
The starting point, inevitably, is to decide what the document is and isn’t. It is, certainly, a lengthy and considered direction-setter – not just for the Government, but for business and industry, and indeed for consumers. While much of the content was favourably received in terms of highlighting ways to ensure clean growth, critics – not unjustifiably – suggested it was long on pages but short on detailed and finite policy commitments, accompanied by clear timeframes for action.
A Strategy, Instead of a Plan
But should we really be surprised? The answer, in all honesty, is probably not really. BEIS ministers had made no secret of the fact they would be publishing a ‘strategy’ as opposed to a ‘plan,’ and that gave every indication the CGS would set a direction of travel and be largely aspirational. The Government had consulted on its content, and will likely respond to the consultation during the course of 2018. And that’s when we might see more defined policy commitments and timeframes from action.
The second criticism one might level at the CGS is that indicated the use of ‘flexibilities’ to achieve targets set in the carbon budgets – essentially using past results to offset more recent failings to keep pace with emissions targets. Claire Perry has since appeared in front of the BEIS Select Committee and insisted she would be personally disappointed if the UK used flexibilities to fill the shortfall in meeting the fourth and fifth carbon budgets, but this is difficult ground for the Government. The Committee on Climate Change was critical of the proposed use of efficiencies, which would somewhat undermine ministers’ good intentions and commitment to clean growth – particularly set against November’s Budget, in which the Chancellor maintained the current carbon price floor (potentially giving a reprieve to coal) and introduced tax changes favourable to North Sea oil producers.
A 12 Month Green Energy Initiative with Real Teeth
But, there is much to appreciate and commend about the CGS. It fits into a 12-month narrative for BEIS ministers, in which they have clearly shown a commitment to clean growth, improving energy efficiency and cutting carbon emissions. Those 12 months have seen the launch of the Industrial Strategy – firstly in Green Paper form, which led to the launch of the Faraday Challenge, and then a White Paper in which clean growth was considered a ‘grand challenge’ for government. Throughout these publications – and indeed again with the CGS – the Government has shown itself to be an advocate of smart systems and demand response, including the development of battery technology.
Electrical Storage Development at Center of Broader Green Energy Push
While the Faraday Challenge is primarily focused on the development of batteries to support the proliferation of electric vehicles (which will support cuts to carbon emissions), it will also drive down technology costs, supporting the deployment of small and utility-scale storage that will fully harness the capability of renewables. Solar and wind made record contributions to UK electricity generation in 2017, and the development of storage capacity will help both reduce consumer costs and support decarbonisation.
The other thing the CGS showed us it that the Government is happy to be a disrupter in the energy market. The headline from the publication was the plans for legislation to empower Ofgem to cap the costs of Standard Variable Tariffs. This had been an aspiration of ministers for months, and there’s little doubt that driving down costs for consumers will be a trend within BEIS policy throughout 2018.
But the Government also seems happy to support disruption in the renewables market, as evidenced by the commitment (in the CGS) to more than half a billion pounds of investment in Pot 2 of Contracts for Difference (CfDs) – where the focus will be on emerging rather than established technologies.
This inevitably prompted ire from some within the industry, particularly proponents of solar, which is making an increasing contribution to the UK’s energy mix. But, again, we shouldn’t really be surprised. Since the subsidy cuts of 2015, ministers have given no indication or cause to think there will be public money afforded to solar development. Including solar within the CfD auction would have been a seismic shift in policy. And while ministers’ insistence in subsidy-free solar as the way forward has been shown to be based on a single project, we should expect that as costs continue to be driven down and solar makes record contributions to electricity generation, investment will follow – and there will ultimately be more subsidy-free solar farms, albeit perhaps not in 2018.
Meanwhile, by promoting emerging technologies like remote island wind, the Government appears to be favouring diversification and that it has a range of resources available to meet consumer demand. Perhaps more prescient than the decision to exclude established renewables from the CfD auction is the subsequent confirmation in the budget that Pot 2 of CfDs will be the last commitment of public money to renewable energy before 2025.
In short, we should view the CGS as a step in the right direction, albeit one the Government should be elaborating on in its consultation response. Its publication, coupled with the advancement this year of the Industrial Strategy indicates ministers are committed to the clean growth agenda. The question is now how the aspirations set out in the CGS – including the development of demand response capacity for the grid, and improving the energy efficiency of commercial and residential premises – will be realised.
It’s a step in the right direction. But, inevitably, there’s much more work to do.
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