Maersk says ocean shipping's zero-emissions push needs government support

Goldwind Science & Technology Co

28/08/2024 18:26

By Lisa Baertlein
       LOS ANGELES, Aug 28 (Reuters) - The Alette Maersk was
the first container vessel powered by low-carbon methanol fuel
to cross the Pacific Ocean - a milestone in the shipping
industry's effort to reduce its climate impact.
    But when the 1,148-foot (350-meter) vessel arrived at the
Port of Los Angeles from China last week, there was nowhere in
the U.S. to buy more of the green fuel, forcing it to rely
heavily on petroleum-based maritime fuel for the return trip. 
    At a day-long ship naming event on Tuesday, A.P.
Moller-Maersk representatives said the industry that accounts
for close to 3% of global greenhouse gases needs more and
cheaper green fuel if it is to decarbonize at the pace
scientists and world governments say is necessary to fight
climate change.
    "We're on a clock," said Maersk CEO Vincent Clerc. 
    Maersk  MAERSKb.CO  aims to achieve net zero greenhouse gas
emissions in 2040 and has emerged as a leader in its sector's 
energy transition with five green methanol ships on the water
and another 20 on order.
    Even so, that represents just a fraction of its 700 owned
and chartered ships. The new ships are also dual-fueled, meaning
they are equipped to run on fossil fuels when needed, like when
green methanol is too expensive or unavailable. 
    Green methanol can be made from agricultural and food waste,
or from carbon dioxide and hydrogen using renewable electricity.
    The fuel now costs two to three times more than fossil
fuels, Maersk representatives said, and global production is
currently miniscule. 
    China's Goldwind  002202.SZ  has guaranteed green methanol
supplies for the first of Maersk's 12 large ocean-going vessels
to burn that fuel, with deliveries starting in 2026. 
    But potential supplier Orsted  ORSTED.CO  is dropping plans
to build the largest e-methanol plant under construction in
Europe, saying that the green fuels market was developing more
slowly than expected. E-methanol is made with CO2 captured from
renewable sources.
    Maersk also plans to replace as many as 60 additional ships
with dual-fuel vessels that run on renewable fuels including
liquefied bio-methane. That low-emissions fuel from renewable
sources is controversial because it is chemically identical to
fossil methane, so any leaks release a potent greenhouse gas.
    Most of Maersk's ships also can run on biodiesel, a
replacement fuel that has been available for years but still
accounts for a tiny portion of maritime fuel.   
    Familiar shippers like Nike  NKE.N , Amazon.com  AMZN.O ,
H&M and Nestle  NESN.S  have partnered with Maersk on green
fuel-powered deliveries to help drive adoption that can justify
investments in production.
    "No one can do this alone," Venkatesh Alagirisamy, chief
supply chain officer at Nike, said at Tuesday's event, where
officials called for regulators and governments to act. 
    Clerc said Maersk has asked U.S. President Joe Biden's
administration to use the Inflation Reduction Act to incentivize
green maritime fuel, as it has done for the trucking and
aviation sectors. 
    Maersk and peers CMA CGM  CMACG.UL , Hapag-Lloyd  HLAG.DE 
and MSC have also proposed a regulatory framework to the
International Maritime Organization. That includes a plan to
levy a "green balance fee" on carriers that gain a competitive
advantage by clinging to lower-cost fossil fuels.
    "We need regulations and legislation to level the playing
field," said Saba Takidar, Maersk's senior commercial
sustainability partner. "The whole fuel ecosystem has to
change."    

 (Reporting by Lisa Baertlein in Los Angeles; Editing by Jan
Harvey)
 ((lisa.baertlein@thomsonreuters.com; +1 310-491-7241; Reuters
Messaging: lisa.baertlein.thomsonreuters.com@reuters.net))