Whitepaper: How Digitalization Can Unlock Green Shipping Corridors from Feasibility Study to Implementation.
PortXchange [B-Corp]
Track. Analyze. Report All Transport Modalities Emissions at Your Port!
Author Dr Beatriz Canamary
Co-Author Sue Terpilowski OBE
Introduction
This whitepaper is created in collaboration with PortXchange [B-Corp] , and explores the strategic implementation of green corridors, examining the opportunities and challenges involved, and provides actionable insights for stakeholders committed to achieving a sustainable maritime industry.
We present a strategic five-step approach that creates a value proposition for green shipping corridors. This approach incorporates the critical additional benefits of digital solutions to accelerate decarbonization and create tangible results for faster implementation. This approach is designed to streamline the process of establishing successful green corridors, effectively bridging the gap between intention and realization. It enables maritime and port authorities worldwide to enhance operational efficiency, reduce their carbon footprints, and Scope 3 emissions.
Executive Summary
Why do we need green shipping corridors?
To achieve full decarbonization of the shipping sector by 2050, zero-emission fuels and vessels must be deployed at scale over the next decade.
The green corridors concept emerged from COP26 (2021) in the Clydebank Declaration, which was endorsed by 22 countries. This declaration included a commitment to establish at least six green shipping corridors by the middle of this decade.
The same year, the Global Maritime Forum's "Getting to Zero Coalition" report highlighted the potential of green shipping corridors along specific trade routes using major port hubs to pave the way towards zero emissions. The report emphasized that green corridors could create favorable conditions for decarbonization by enabling policymakers to establish a supportive ecosystem through targeted regulatory measures, financial incentives and safety regulations.
Creating these green shipping corridors allows the maritime industry to test, calibrate and assess risks within localized or specific trade route ecosystems, providing valuable insights that can be scaled to other regions or sectors.
While some green shipping corridors have made progress towards feasibility assessments, few have released detailed plans or metrics for realizing these corridors. This indicates either slow movement or the magnitude of the task at hand, partly due to challenges such as uncertainty around fuel pathways, the complexity of bringing all stakeholders together to develop a strategy and implementation plan and high investment costs.
Forward
Green corridors run the risk of being deprioritized or abandoned if they continue without tangible results. Adding digital solutions might be a simple yet effective way to address this issue and help bring forward their implementation.
Another component that needs serious addressing is the low barrier to entry due to the absence of stringent criteria which allow anyone to declare a shipping corridor as green. Although this openness increases volume of new corridors to be created, it also leaves room for some stakeholders to design corridors without firm commitments, diminishing their impact and rendering them ineffective in meeting the necessary criteria for significant maritime decarbonization. From conversations we have had with various ports, it is evident that despite the oversight and management from the Global Maritime Forum, quite a few corridors have still been created from a marketing point of view.
To counteract greenwashing within the green corridor movement, transparency is crucial. This involves standardized digital reporting on the progress of green corridors and educating stakeholders. Additionally, sharing data and challenges will foster an environment where all participants collaborate to address the issues and make collective progress.
The Global Maritime Forum 's Annual Progress Report on Green Shipping Corridors states, "If green corridors are to hit their targets and fulfill their function, 2024 must be a breakthrough year in which front-running initiatives begin to execute their plans and others are primed to follow quickly. Success hinges on accelerated effort within the corridors, the swift introduction of fit-for-purpose measures by the governments, and the willingness of the broader shipping ecosystem to support the first adopters/frontrunners."
According to the DNV database, 57 green shipping corridor initiatives have been recorded as of February 2024. This number doubled from 22 in 2022 to 44 in 2023, the year the IMO adopted its revised greenhouse gas strategy.
As an industry, we must ask ourselves: are we truly committed to Green Shipping Corridors? Is there an element of greenwashing? Will they lose momentum due to the time required for implementation and the number of stakeholders that need to be engaged?
To avoid this challenge, it is imperative to integrate digital solutions, transforming most green corridors into green and digital corridors.
The criteria for which corridors should be prioritized for this transformation are:
These criteria ensure that the efforts to implement digitized green corridors are focused on areas with the highest potential for immediate impact and feasibility. For detailed implementation strategies, please refer to Chapter 4.
To decarbonize the shipping industry, we should not wait for a consensus on the right fuel type(s) or the availability of necessary infrastructure. We should act now, working together as terminals, shipping lines, and ports to align on utilizing digitalization to reduce emissions.
Chapter one
Green Shipping Corridors
The critical operational components in a green corridor include
Ports –port call optimization, fuel bunkering for ships, truck-to-ship, onshore power/cold ironing alongside the ports' vehicles and cranes.
Ships – zero emission fuels (well-to-wake emissions analysis), voyage optimization, JIT arrivals, vessel dynamics, speed optimization, weather routings, data gathering and analysis, optimized utilization, vessel design.
Establishing a green corridor will involve coordination across multiple players, including governments, local authorities, industry, ports, and shipping lines.
Green Corridors Leadership and Goals
The leadership and goals of each green shipping corridor project can differ, reflecting specific regional needs and strategic targets. However, all such projects share a common purpose: to advance multiple aspects of maritime sustainability. These corridors serve as dynamic environments for the development and scaling of innovative solutions across various dimensions, including:
Green shipping corridors not only aim to reduce carbon emissions but also focus on the digital transformation of maritime transport. These corridors are pivotal in testing and proving the viability of new technologies and fuels, setting the stage for their broader application in the global shipping industry.
This holistic approach ensures that green shipping corridors are at the forefront of promoting environmental sustainability and technological innovation in maritime logistics.
Chapter TWO
Benefits of Green Corridors
Green shipping corridors are integrative by nature. They are bringing together multiple stakeholders, from government authorities to corporations and providing numerous benefits to countries and companies through decarbonization. By involving everyone, green shipping corridors show how to create a positive socio-economic and environmental change.
The primary goal and foremost benefit of these corridors is to reduce greenhouse gas (GHG) emissions and other pollutants. This significantly improves air quality, marine life and ecosystem protection, promoting healthier oceans and mitigating climate impact. Consequently, they offer health benefits to local communities and create green economy opportunities for the participating countries.
Green corridors represent a practical and strategic approach to achieving significant environmental, economic, and social benefits, paving the way for a more sustainable maritime industry.
In pursuit of GHG emissions reduction, green shipping corridors foster the transition to low- and zero-emission fuels and leverage the development and deployment of new technologies and digital solutions, enhancing innovation and competitiveness.
For instance, the Singapore-Rotterdam Green & Digital Shipping Corridor foresees a 20% to 30% reduction in emissions from international shipping by 2030 through a combination of operational and digital efficiencies.
Finally, as we navigate the transition away from fossil fuels, it is crucial to reflect on and address the existing injustices embedded in today's global economy, such as unequal access to energy, food, and water, economic disparities between the Global South and Global North, and social inequities.
By applying a just and equitable transition lens to green corridors, stakeholders can shape a transition that not only mitigates negative impacts but also ensures that the benefits are inclusively shared across communities and nations (UNFCCC, 2023). With that, green shipping corridors can even facilitate governmental and international support through subsidies, grants, and favorable regulatory conditions.
Rotterdam-Singapore Green & Digital Shipping Corridor adopted a "building block" approach to decarbonize the trade lane
Here's what's next:
3. Challenges and Solutions in Implementing Green Corridors
4. Role of Digital Technology in Green Corridors
5. Case Studies & Strategic Five-Step Plan
6. The way further
Green tech solutions by PortXchange [B-Corp] for port authorities worldwide.
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