LEADING INTERNATIONAL MARITIME MAGAZINE

Prize for initiative

A leading global body working to make sustainable shipping mainstream, London-based non-profit the Sustainable Shipping Initiative (SSI) was a key party in the landmark Ship Recycling Transparency Initiative which launched an online info-sharing platform at the end of 2018. 

Shipping is by far the world’s most efficient form of transport, but as a watchful and sometimes suspicious world knows, efficiency can come at a heavy environmental price.

While moving more than 90% of the world’s traded goods, the shipping industry is responsible for 3% of greenhouse gas emissions. Against a backdrop of poor financial returns, an imperative to keep transport costs low, and increasingly stringent regulations, the industry is facing huge challenges in identifying affordable zero-emission fuels and finding new ways to reduce the environmental, occupational health and safety risks associated with shipping.

 

Progressive voice

It is a formidable set of circumstances, and a leading progressive voice in stimulating debate and developing viable solutions and long-term thinking is the Sustainable Shipping Initiative (SSI). 

An independent non-profit established in 2010, the London-headquartered SSI’s membership is made up of charterers, shipowners, shipyards, service providers, banks, class societies and NGOs; all with the common objective of making sustainable shipping mainstream. The SSI vision: a shipping industry where sustainability equates success.

“We are an active organisation of like-minded and leading industry stakeholders who are driven to the same goals of going beyond regulation and doing the right things the right way,” said Executive Director Andrew Stephens.

The SSI is accelerating sustainable development across the maritime sector through leadership and collaboration, innovation, debate and collective learning. Its objective is to identify tangible solutions through the example of and expertise of its members, while driving the debate to encourage long-term thinking. SSI thematic working groups are dedicated to addressing specific elements of the sustainable shipping agenda, ranging from low carbon shipping and biofuels to social sustainability, financing clean technology, and closed loop material management.

The current membership of the SSI reflects a broad spectrum of stakeholders across the maritime sector, including: ABN Amro, Akzo Nobel, Bunge, The China Navigation Company, Forum for the Future, IMC, Louis Dreyfus Company, Lloyds Register and AP Moeller-Maersk. In addition, Oldendorff Carriers, Priya Blue, Rightship, Standard Chartered Bank, Wartsila and WWF are all members of the SSI too.

Originating then later spinning off from the sustainability non-profit Forum for the Future, the SSI is managed by its members with support from a Secretariat and is overseen by a board of trustees currently composed of representatives from The China Navigation Company, Lloyds Register, A.P. Moeller-Maersk and Rightship.

 

SSI: Key achievements

2011: SSI Case for Action published, identifying seven global trends expected to profoundly affect the maritime sector over the next 30 years.

2011: SSI members signed into action their collective Vision for 2040, setting out their aspirations for how the industry needs to respond to the challenges addressed in the Case for Action – backed up by specific commitments to action.

2012: Launch of SSI four initial work streams (finance, materials management, energy tech and credible benchmarking), aimed at implementing its Vision for 2040 and leading to several outcomes including the Save As You Sail (SAYS) financial model and the web-based benchmarking tool used by charterers.

2013: Publication of the SSI Roadmap and the Case for More Action.

2015: Low Carbon Working Group-commissioned study led by University College London (University Maritime Advisory Services - UMAS) exploring the CO2 reductions required in order to limit global emissions.

2016: The Social Sustainability Working Group examined challenges related to the social welfare and standards of seafarers on-board, with the objective of making seafaring a more attractive career choice by increasing the overall quality of life on-board ships.

2018: The Low Carbon Working Group commissioned Lloyds Register and UMAS to undertake a study examining the viability of zero emission vessels, concluding that currently, the most viable option for the shipping industry is biofuels.

2018: The SSI’s Ship Recycling Working Group transitions into its own fully-fledged initiative. The Ship Recycling Transparency Initiative (SRTI) was launched at Tradewinds in March 2018. The online platform went -  www.shiprecyclingtransparency.org - went live in December 2018.

 

Landmark reports

An early landmark in its mission of steering the shipping sector towards a diverse and resource-efficient mix of energy sources, came with the publication in 2011 of the Case for Action. The report identified the major social, environmental and economic opportunities and challenges facing the shipping industry over the next 20 to 30 years and how best to react to them. The report laid bare the compelling argument for the shipping industry to address three key themes: navigating a changing economic context; increased scrutiny and high expectations of transparency; and the future of energy and climate change

Following up on the Case for Action came the SSI Roadmap, in which leading businesses, including fleet operators, suppliers, customers and financiers, looked ahead to 2040, presenting a clear overview of the macro environment and lays out the pathways for creating a flourishing and sustainable shipping industry in 2040.

The Roadmap is a dynamic document, evolving to reflect changes across the industry in terms of political, technical, industrial, environmental and social aspects.

The Roadmap sets out six overarching goals for the shipping industry must achieve in order to become sustainable: ocean governance, coastal communities, shipping careers and seafarers, transparency on sustainability performance, financing, and energy efficiency and diversity.

 

Why a roadmap for sustainable shipping?

The SSI Roadmap is intended as a practical resource for companies and organisations to understand the present and future challenges facing the maritime sector, as well as the steps and milestones to shape their own sustainability strategies. As a ‘live’ working tool, the SSI actively engages with key stakeholders across the shipping industry to periodically update the Roadmap based on progress to date, as well as reflect changes in the industry landscape.

 

In May last year came the SSI-commissioned report: Zero Emission Vessels, what needs to be done? Authored by Lloyds Register and the University Maritime Advisory Services (UMAS) the report examined the potential of three viable candidates as alternatives for the shipping industry in relation to the needs and requirements of SSI members, who are mainly involved in deep-sea trades with container ships, bulk carriers and tankers. The three alternatives explored were hydrogen fuel cell, electric and biofuels.

 

Alternative fuels

“We are facing the global warming and climate change issues which are on everybody’s agenda, and one of the principal focuses in terms of what we are engaged in, is looking at alternative fuels,” said Mr Stephens.

“We are looking at decarbonisation with biofuels as one of the alternatives, and one that we are taking a deeper dive into, testing and working with other industries such as aviation.”

Of the three alternative candidates explored in the study, biofuels currently presented the most economical option for shipping. However, it was noted that great challenges remain in relation to their sustainability, along with the scale and location of production and availability.

“Right now it’s not clear whether biofuels are the sole alternative, and we are convening a wider range of experts across several industries to learn from their experiences and expertise,” stated Mr Stephens.

Aviation is one of the most polluting industries on the planet – but a groundswell of innovation in alternative fuels and investments from major airlines, could set it on a path to carbon zero.

In September 2018, the US low-cost airline JetBlue made its first flight using a renewable blend fuel, 15.5% coming from used cooking oil from restaurants which would otherwise have been wasted. Could experience in the air have lessons for the high seas? The SSI is watching and listening.

“We joined discussions with the Roundtable on Sustainable Biomaterials (RSB) in December, where some of our members joined the panel,” said Mr Stephens. “Already we have some concrete examples of shipping industry peers using alternative fuels: using fish leftovers combined with organic waste to generate biogas for is cruise ships and container ships being powered by diesel made from waste cooking (vegetable) oil.”

 

The recycling issue

Out of a global fleet of circa 50,000 ships, 835 were recycled in 2017, and concerns are widespread that many ship-breaking projects are carried out in an informal sector, with few safety and environmental controls. The industry’s response was the Ship Recycling Transparency Initiative (SRTI), in which the SSI played a leading role.

Launched in Hamburg last year as a collective effort comprising shipowners, banks, classification societies and non-profit organisations, the SRTI aims to accelerate a voluntary market driven approach to responsible ship recycling practices through increased transparency on ship recycling policies, practices and performance. The initiative ultimately intends to influence and improve decision making around ship recycling, enabling the shipping industry to be held to account and creating an industry-wide level playing field.

Among the representatives on the SRTI Steering Group are The China Navigation Company, Forum for the Future, GES International, Hapag Lloyd, Lloyd’s Register, A.P. Moeller-Maersk, NORDEN, Nykredit, Standard Chartered Bank, Stolt Tankers and Wallenius Wilhelmsen.

The figures are stark and disturbing. Out of the total 835 ships dismantled in 2017, 543 large ocean-going vessels – approximately 80 % of the total tonnage scrapped – landed on the tidal beaches of Bangladesh, India and Pakistan.

Without a dock or harbour, ships are driven in at high tide and deliberately grounded straight onto a beach, where workers salvage the steel, often without specialist machinery or protection. As a result, many are seriously injured and in some cases, fatally.

The essence of the SRTI is to support improved policy, practice and performance, and Mr Stephens sees the supporting momentum across all segments in the industry as strong and growing. 

“The drive from the demand side is getting stronger and stronger,” he said. “We are seeing action by investors, who are moving their investments away from shipping portfolios that do not match their green or ethical principles and policies.

“And we see a similar stance being taken by cargo owners, who are looking through their supply chain, not just from the factory to the place where they are selling or distributing, but also at the transport legs between.”

 

Pressure is on

Mr Stephens added: “We are also seeing the pressure on shipowners to transform, adopt and secure responsible ship recycling yard practices and making them more ethical and socially and environmentally acceptable, coming from banks and the insurance industry.”

In India, 70 of the 120 working plots at Alang, Gujarat – home to the world’s largest stretch of ship breaking beaches – are certified against green recycling standards set by the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships and adopted by the IMO in 2009. Some of these ship recycling facilities have recently applied to be on the EU Ship Recycling Facilities approved (white) list.

“Our focus is to build the momentum for the transformation and change to occur as early as possible, a strategy that will accelerate following the launch in December of the SRTI online platform, a tool for sharing information on ship recycling to drive responsible practice.”

With transparency on shipping companies’ ship recycling policies and practices, it becomes possible for the industry’s stakeholders – including cargo owners, retailers, manufacturers, lenders, investors and insurers – to make informed sourcing- and investment-related decisions. The SRTI can be built into existing codes of conduct and sustainability strategies and can be used as a requirement in procurement processes.

 

Brand value

Sustainable shipping, such as responsible ship recycling practices, are good for brand value, protecting reputation and good for business, and is key to being recognised as a responsible and sustainable shipping industry, said Mr Stephens.

“We have a clear vision of where we are going, and it’s a long-term vision,” he said.  “It’s not a case of applying for membership to get the badge. Our members are actively engaged, and the Sustainable Shipping Initiative is the place where things get done and things happen.”