According to a survey of transportation professionals spearheaded by global law firm Reed Smith, nearly half the respondents expect it will take more than 15 years for the sector to be powered by 100% sustainable fuel sources, with LNG the most likely transition fuel over the next three to five years.
This was the central message drawn from 50 of Reed Smith’s clients in the transportation sector, including global carriers in aviation, shipping, logistics, manufacturing, utilities, and environmental services.
The International Maritime Organization’s (IMO’s) ambitious target of reaching net-zero by 2050 is well known in the industry, but the question of whether the industry feels this is doable has long been debated, noted Reed Smith lawyer Voirrey Davies.
The 2023 IMO GHG Strategy sets out two indicative checkpoints that the IMO will use to benchmark the likelihood of success.
These are:
- Reduce the total annual GHG emissions from international shipping by at least 20%, striving for 30%, by 2030 compared to 2008.
- Reduce the total annual GHG emissions from international shipping by at least 70%, striving for 80%, by 2040 compared to 2008.
Already, the IMO target of a 70% reduction in carbon by 2040 is seen as ambitious. In addition, almost a fifth of respondents said they believed the transportation industry would never be 100% powered by sustainable fuel sources.
When looking at the industry on a global scale, it is clear why there are concerns that certain areas of the industry, such as those based in developing nations with limited investment in infrastructure, will never be operating fully sustainably, the survey report stated.
With many national grids largely powered by fuels such as oil and gas, ports and terminals are receiving power from non-sustainable fuel sources. This also means that even where ships are attempting to be more sustainable and connect to shore power, the question is then raised as to from what fuel this power is generated, potentially blocking the 100% sustainable fuel goal.
“Without investment in both shore facilities and assets, the transportation industry will struggle to reach the IMO goals, and it is possible that our respondents who said the industry would never reach 100% sustainability on fuel will be proved right but we remain hopeful that the IMO goals will be reached if the industry keeps building momentum towards net-zero,” the survey concluded.
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