Shipping leaders and green hydrogen producers agree on ambitious uptake targets for 2030 to enable a net zero maritime sector

Shipping sector leaders have committed to scaling up zero-emissions fuel derived from renewables-based hydrogen to nearly 11 million tonnes by 2030, sending a clear signal to the nascent industry. By RMI | December 6, 2023

Thirty leaders in the shipping sectors – including cargo owners, ship operators, ports, bunkering companies, and equipment manufacturers – signed a Joint Commitment, organized by the UN High Level Champions and RMI, today at COP28 to enable the use of  renewable hydrogen-derived shipping fuel this decade to meet maritime industry  decarbonization targets. The Commitment includes important targets for fuel use, fleet  development, and port infrastructure needed to get the nascent green hydrogen industry to  scale. 

To reach targets set out in the International Maritime Organization (IMO)’s 2023 Strategy, adopted by 175 member states earlier this year, the average ship’s greenhouse gas intensity  will need to be reduced by 86% by 2040. Achieving this requires large-scale and rapid  growth in the use of zero or near zero-emission fuels, of which green hydrogen-derived fuels like ammonia and methanol will play a crucial role. Legally binding international regulations  that enter into force in 2027 will require the use of low-emissions fuels. 

“For a general shipping company such as MOL, there is no single solution for vessel fuel. We  will promote the adoption of optimum fuels including hydrogen, ammonia and any other  potential green fuels for each business on the premise of achieving net zero in 2050 and our  interim milestones,” said Takeshi Hashimoto, CEO at Mitsui O.S.K Lines, Ltd. (MOL). MOL  is one of the world’s leaders in marine transportation. MOL’s fleet, approximately 800 vessels  consist of a wide variety of types of ships. “In addition to working on the development and  operation of vessels from the perspective of fuel users, we will work with diverse partners to  urge upstream players of the fuel supply chain to join our efforts to expand the use of new  fuels.”

As part of the Commitment, green hydrogen producers agreed to produce 11 million tons of  the low-emissions fuel for use by the shipping sector by 2030. Longer term, a decarbonized  global shipping sector will become one of the largest demand sources for green hydrogen,  projected to account for approximately 15 percent of total demand by 2050. 

“In the mission to decarbonize shipping using green hydrogen and derivatives, global  collaboration is key. This statement highlights the need for all participants across the value  chain to collaborate deeply on both the supply and demand sides. We’re not building big  green energy projects; we’re catalyzing change. It’s time for a determined step forward to  foster projects that go well beyond current thinking on scale and get us straight onto the  scale up fast track,” said Alex Hewitt, CEO of CWP and chair of the Green Hydrogen  Catapult. 

To meet growing demand and enable decarbonized vessels, fuel supply and infrastructure  must be present at ports on both sides of shipping routes, a fact that will require significant  international coordination and investment. 

“In the Pacific Northwest, we are actively working with our industry partners to catalyze development of a regional market for zero emissions fuels. We see green hydrogen as having significant potential to decarbonize maritime,” said Sam Cho, Port of Seattle Commission President and Co-Chair of The Northwest Seaport Alliance, a marine cargo operating partnership of the Port of Seattle and the Port of Tacoma. “Green corridors focusing on cruise to Alaska and cargo with the Republic of Korea are already underway. A critical next step is to look beyond our own port, and to ensure that our strategies align with future planning and investment in fuel supply in our region and around the world.”

“Green corridors focusing on cruise to Alaska and cargo with the Republic of  Korea are already underway. A critical next step is to look beyond our own port, and to  ensure that our strategies align with future planning and investment in fuel supply in our  region and around the world.” 

Ports and ports’ enablers have added their support for the Call to Action, committing to  invest in infrastructure and safety projects to support re-fueling of ships with green hydrogen  and its derivatives. 

Rasmus Bach Nielsen, Global Head of Fuel Decarbonization for Trafigura, said: “We will only  achieve the deep decarbonization of shipping by switching to zero-emission fuels derived  from renewable-based hydrogen. As one of the world’s largest charterers of vessels, the  commitments we are making alongside others should encourage investment by ports and  port enablers serving shipping routes to invest in the necessary infrastructure. This in turn  will help further incentivize the production of green hydrogen and hydrogen-derived fuels  for use in shipping.”

Keld R. Demant, CEO of Bunker Holding Group, said: “As the world’s largest bunker  supplier, Bunker Holding Group fully supports the IMO GHG Strategy for decarbonizing the  shipping industry. We contribute by partnering with alternative fuel producers, and handle  trades and logistics related to the last mile delivery. But to succeed, all industry stakeholders  along the value chain need to stand together.” 

Equipment manufacturers also joined as signatories, committing to support research and  development efforts to further green hydrogen-based fuel deployment in the maritime  sector. 

“Regardless of what other future-fuels eventually come into play, green hydrogen and green  fuels derived from it will undoubtedly play a major role in all scenarios. At MAN Energy  Solutions, we strongly believe that shipping is the ideal enabler for a hydrogen ramp-up,  consuming as it does around 300 million tons of conventional fuels annually,” said Uwe  Lauber, CEO of MAN Energy Solutions. “Currently, our subsidiary – H-TEC SYSTEMS – is  building a manufacturing facility for PEM electrolysis stacks for green hydrogen, which will  add to the necessary scaling and market for zero-emission fuels. We are happy to add our  voice to the growing alliance pushing for marine decarbonization.” 

Signatories called on governments to follow suit and support private sector collaboration  with ambitious fuel standards and clean fuel mandates. To date, 41 governments have  formulated national hydrogen strategies, many of which specifically address the shipping  sector. Further action is needed to align and commit to well-to-wake emissions accounting, creating an enabling policy environment for verifiable low-emissions fuels. 

“In support of our collective actions we call on the IMO and member States to adopt a GHG  pricing mechanism, a levy, as the most appropriate mechanism to achieve a just and  equitable transition, among other measures. Collective action and cross sector cooperation is  vital to make sure that shipping’s zero emission transition happens smoothly and quickly,”  Nielsen at Trafigura said. 

Demant of Bunker Holding Group added: “To stimulate the demand and supply of zero or  near-zero fuels, IMO should adopt pricing incentives as well as requirements for alternative  fuels. Regulatory insurance is a prerequisite for the necessary investment in production,  infrastructure, and new vessels.”

Read the Joint Commitment

Media Inquiries please contact:

Alexandra Jardine Wall, Strategic Communications Manager, RMI. E: awall@rmi.org Notes to Editors 

About RMI 

RMI, founded as Rocky Mountain Institute, is an independent nonprofit founded in 1982  that transforms global energy systems through market-driven solutions to align with a 1.5°C  future and secure a clean, prosperous, zero-carbon future for all. We work in the world’s  most critical geographies and engage businesses, policymakers, communities, and NGOs to  identify and scale energy system interventions that will cut greenhouse gas emissions at least  50 percent by 2030. RMI has offices in Basalt and Boulder, Colorado; New York City;  Oakland, California; Washington, D.C.; and Beijing. More information on RMI can be found  at www.rmi.org or follow us on Twitter @RockyMtnInst

About MAN Energy Solutions  

MAN Energy Solutions enables its customers to achieve sustainable value creation in the  transition towards a carbon neutral future. Addressing tomorrow’s challenges within the  marine, energy and industrial sectors, we improve efficiency and performance at a systemic  level. Leading the way in advanced engineering for more than 250 years, we provide a  unique portfolio of technologies. Headquartered in Germany, MAN Energy Solutions  employs some 14,000 people at over 120 sites globally. Our after-sales brand, MAN  PrimeServ, offers a vast network of service centres to our customers all over the world. 

About the Port of Seattle  

A highly diversified public port, the Port of Seattle owns and operates some of the Pacific Northwest’s most essential infrastructure, including Seattle-Tacoma International Airport (SEA), and maritime industrial facilities for commercial fishing, cruise, and recreational boating. The Port of Seattle’s promotes economic opportunities and quality of life by advancing trade, travel, commerce, and job creation in an equitable, accountable, and environmentally responsible manner.

About the Northwest Seaport Alliance

The Northwest Seaport Alliance is a marine cargo operating partnership between the Port of Seattle and Port of Tacoma. Combined, the North and South harbors are a major North American gateway for containerized trade and the handling of non-containerized commodities such as bulk, breakbulk, project/heavy-lift cargoes, and automobiles. Both partner ports and the Alliance have made a voluntary commitment to zero maritime emissions by 2050 or sooner.

About Bunker Holding Group  

Bunker Holding Group is the global leader in purchasing, selling, and supplying marine fuel  and lube oil as well as providing risk management and other vital services for the shipping  industry. The company operates via more than 1,668 ports worldwide and is present in 32  countries with 62 offices and more than 1,650 skilled employees.