May 18, 2023 | Logistics Blogs
Drastically reducing carbon emissions and achieving carbon neutral manufacturing and sustainability are some of the hard goals polluting industries need to achieve amid regulatory and investor expectations.
The shipping industry too is under immense pressure to lower its carbon footprint, most of which comes from the use of fossil fuels to run ocean transportation. Biofuels are now emerging as a reliable and suitable alternative to fossil fuels.
Maritime transportation is estimated to contribute 3.5-4% of global emissions because of the burning of marine diesel oil and heavy fuel oil.
Apart from these, emissions also come from maintenance, construction and decommissioning of shipping vessels and cargo containers.
Additionally, the shipping industry also contributes to water pollution and habitat destruction through activities such as ballast water discharge and oil spills.
With these challenges, industry stakeholders and regulators are actively seeking sustainable solutions that will reduce the overall environmental impact of the shipping industry.
Also read: Why Retailers Need to Lock-In Favorable Ocean Freight Rates and Terms Now
Replacing traditional fossil fuels with suitable alternatives such as biofuels offers a viable option in reducing the carbon footprint. These biofuels and alternative fuel sources have the potential to reduce the carbon emissions by about 50%, that will act as the key in reducing the global CO2 emissions.
Biofuels such as bioethanol, biodiesel, hydrogen, methanol, clean ammonia are a few of the emerging alternative fuel options that shipping companies are considering.
For instance, in a recent survey by transport law firm Watson Farley & Williams, nearly 60% of the shipowners said they are considering using biofuels as an alternative to gas to reduce the overall carbon footprint.
Thus, biofuels are attracting a lot of attention from the shipping industry to accelerate ESG goals and sustainability .
However, support from various regulatory bodies is needed to accelerate the adoption of biofuels.
The U.S. and Europe have implemented various targets and created policies to ensure lowering of carbon emissions and meeting the 2030 and 2050 net-zero goals.
The Renewable Fuel Standard Program in the U.S. and Renewable Energy Directive II in E.U. have called for increasing the overall usage of biofuels as source of fuel in the shipping industry.
However, without proper government support, these policies will have low impact on biofuel usage.
There are a few programs that could have a positive impact on biofuel adoption. For instance, the U.S. Department of Energy announced it would provide funding worth $118 million to support the production of sustainable biofuels for transportation and manufacturing.
Using biofuels as an alternative to fossil fuels does promise to help the shipping industry cut its emissions. Regulatory support from government bodies as well as initiatives by the private sector are already fostering adoption of biofuels in maritime transport.
However, challenges such as scaling up biofuel production, regulatory and technological uncertainty and access to finance are hindering the adoption of biofuels as the mainstream fuel source.
Investment in R&D, private-public partnerships and setting up definite regulatory guidelines are expected to ensure these challenges are addressed.
Author: Mitesh Doshi