“Charting a course to a greener future for shipping:
Low-emission fuel supply and the opportunities for the Global South
Trafigura, a market leader in the global commodities industry, has today published new research highlighting the vital role that hydrogen-based fuels will play in decarbonising shipping – and the enormous potential for countries in the ‘Global South’ to produce green ammonia and green methanol to satisfy growing global demand for these low-emission fuels.
“Our research estimates the ‘Global South’ could produce almost 4,000 exajoules per year of competitively priced green hydrogen, against projected annual shipping demand of 20 to 40 exajoules. This could provide developing countries with the chance to develop new export industries and create thousands of skilled jobs,” said Margaux Moore, co-author and Head of Energy Transition Research and Venture Investments at Trafigura. “It will, however, only be realised if the shipping industry can agree on ambitious decarbonisation targets and, crucially, implement a global price on carbon for marine fuels.”
The International Maritime Organization (IMO) is in the process of revising its initial GHG strategy and 2023 presents an important window of opportunity to set a zero, or at minimum net zero, GHG emissions target by 2050, together with ambitious goals for 2030 and 2040.
By agreeing and implementing demanding science-based decarbonisation targets in its revised GHG Strategy, the IMO can accelerate the development of low- and zero-emission fuels and establish global fuel standards, which together will attract the investment needed to overhaul the infrastructure of the global shipping industry and retrofit, or build, new ships at scale.
“Delaying action will only add to the eventual cost of decarbonisation. The IMO needs to decisively move forward to tackle the shipping industry’s emissions and start the journey to a sustainable and resilient future,” added Rasmus Bach Nielsen, Global Head of Fuel Decarbonisation at Trafigura and co-author of the whitepaper.
