Society of Maritime Industries                            ZAS0050

Written evidence from the Society of Maritime Industries

The Society of Maritime Industries is the voice of the UK’s maritime engineering and marine science and technology sector. With over 145 members from primes to small and medium size enterprises (SMEs), we represent more than 90% of the sector by value. Our response is compiled from views expressed by our members including shipbuilders, equipment and system suppliers, system integrators, start-ups and academia.

The key themes from our response and points we would like to highlight to the committee include:

•              There are a number of competing potential solutions for reduced emission and zero carbon shipping currently being developed which introduces much risk and uncertainty for owners/ operators, shipbuilders and equipment and system suppliers. Whilst this also creates opportunities which UK companies are well placed to exploit, Government support, incentivisation and funding will be required to create the right conditions for investment and growth. The transport decarbonization plan provides a useful framework, but needs to be backed by funding commitments and action now.

•              The Government should adopt a bold and ambitious strategy that takes a long-term view, focused not only on the environmental and climate change drivers, but also recognising the potential benefits to UK prosperity from developing leading edge technology and regulatory solutions, leveraging cross sector innovation.

•              The UK Government should use its leadership and influence in forums such as COP26, G7 and G20, to encourage a longer term and more systemic global approach with Governments making more strategic and coordinated action. UK Government action at a local level can also act as an example and motivator for action at an international level.

What contribution can operational efficiencies make to reduce emissions from aircraft / shipping vessels and over what timescale could these have an effect on emissions?

Operational efficiencies on their own will be insufficient to reduce the emissions set by the IMO, EU and others, but they are already making important contributions to reduced emissions and they can be increased in the short term (0-3 years) with careful incentivisation. Commercial operators are already employing speed reduction and route optimization to reduce their emissions, driven primarily by the IMO Carbon Intensity Indicator (CII) measure. Further improvements are possible in the short term with increased use of AI/ML tools now available, also targeting reduced waiting times and improved cargo utilisation (including more trailer drop vice RoRo cargo), but optimisation should be conducted at the fleet level vice vessel level in order to avoid increasing the number of vessels in service. Speed reductions and modified operating cycles will not only reduce emissions in the short term, but also better suit the adoption of zero emission propulsion technology in the longer term. The mandatory use of shore power whilst alongside would significantly reduce polluting emissions but will require infrastructure investment and funding support to implement in the medium term (3-5 years).

In addition to these operational measures, an even more holistic approach should be taken to intra-UK transport logistics to consider the increased use of environmentally friendly short sea/coastal shipping vice heavy goods vehicles to take freight off of the roads and reduce the carbon footprint of the transportation of freight.

How close are zero carbon fuels to commercialisation for aviation / shipping? How effective will the Jet Zero Council be in catalysing zero emissions technologies? What role should transitional fuels such as alternative hydrocarbon fuels play?

In theory there are a number of zero carbon fuels ready for adoption today but realistically it can be a 3–5 year project with sufficient support required from the wider industry and government to enable implementation. From the perspective of inshore and coastal vessels the best options are electric batteries and/or Hydrogen, provided there are adequate supplies in port and the infrastructure is built. They can be rapidly adopted for all coastal vessels now – the technology is available and is being refined and improved on a daily basis. The main issue is investment in production and distribution facilities and manufacture of critical components eg tanks, fuels cells, etc. Other fuels such as Ammonia and Methanol are more suited to offshore capabilities that require long passages without refuelling, but these also require significant infrastructure investment. Specific investment is needed in fuel manufacture (green H2), fuel storage and distribution and onboard pressure vessels. Early adoption carries significant risks and will require Government led incentivisation and funding.

LNG, bio fuels and synthetic hydrocarbon fuels have an important role to play as transition fuels.  LNG infrastructure and bunkering is increasingly in place and many newbuild ships on order today are dual fuel capable. LNG does have a major disadvantage in that the release of uncombusted methane (methane slip) decreases its value as a ‘green’ fuel. However, ships that are designed and constructed to use LNG may prove easier to modify for low or zero carbon gaseous fuels at a point in the future, making LNG fuelled vessels a viable transitional stage towards net zero emission vessels.

What new technologies are there to reduce emissions from aircraft / shipping vessels and how close to commercialisation are they?

There are many fuel saving technologies either available now or at an advanced stage of development. Some of these can be retrofitted to existing vessels whilst others need to be incorporated at the ship design stage.

Such technologies include add-ons or modifications that reduce the resistance of the hull in the water or improve the efficiency of the installed power plant. They include air lubrication systems, high efficiency rudders, heat recovery systems, smart electrical controls for pumps, bow trim foils, dynamic trim indicators and trimming capability, novel solar panel technology and advanced antifouling coatings. None offer a direct replacement for carbon fuels but, individually or in combination and under the right conditions, can return reductions in power requirements in the order of 5-30%.

Wind power has the potential to reduce dependence on carbon of many ship types, from providing auxiliary power to providing nearly all of the propulsion power requirement – safely and efficiently. Current wind technology is capable of providing the propulsion requirements for optimised vessel types and optimised operations in the order of up to 50% - and of course, under some conditions, approaching 100%. The addition of wind technologies to other vessels could represent savings more in the order of 5-20%.

The UK has a number of wind technology developers poised on the edge of commercial realisation, with solutions including Flettner rotors, wind foils and sail systems. Wind is arguably the best placed current technology capable of making a significant impact on shipping’s carbon footprint in the next decade.

In the longer term, nuclear powered propulsion is also a realistic possibility. Technology solutions such as Molten Salt Reactors are nearing maturity but significant work is required to develop the regulatory and safety case arguments necessary to operate nuclear powered commercial vessels.

How should the Government’s net zero aviation strategy support UK industry in the development and uptake of technologies, fuels and infrastructure to deliver net zero shipping and aviation?

The Government should adopt a bold and ambitious strategy that takes a long-term view, focused not only on the environmental and climate change drivers, but also recognising the potential benefits to UK prosperity from developing leading edge technology and regulatory solutions, leveraging cross sector innovation. Much support will be required in the short term to help industry overcome technology and infrastructure readiness challenges, regulatory approval and skills demands. Government investment will be required in port infrastructure, tax incentives for adoption of reduced or zero emission technology, and improved access to finance. Matched funding for pilot projects such as short sea/coastal shipping, subsidised ferries or a fleet of fishing boats that are zero emission to establish viability for future commercial operations will also be required. Government policies should recognise the long-term nature of vessel lifespans (typically 30 years), current uncertainty around which technologies to adopt and what infrastructure will be available in the future and acknowledge that there may well be several different routes and/or intermediate stages towards carbon neutrality. Technology development also requires support through the higher TRL’s, with barriers to commercialisation often in getting a product tested and proven in a real environment, taking it from a test bench to an operational, ready-for-commercialisation, technology. UK ship owners/operators are already acquiring net zero systems, some of which international competitors have developed. In order to be a global leader in green technology, we need to incentivise investment in UK technologies through any Government support and by introducing a Home Shipbuilding Loan Guarantee scheme to level the domestic playing field.

More work should also be undertaken to recognise the true magnitude of the positive impact to ports and harbours from zero emissions shipping, both environmentally and economically.

What is the most equitable way to reduce aircraft passenger numbers (e.g. reforming air passenger duty and taxes, frequent flyer levies, bans on domestic flights where trains are available, restrictions on airport capacity)? Are there any policy mechanisms that could reduce our reliance on shipping?

We should not be reducing our reliance on shipping – just the opposite. We need to move freight from roads onto short sea transport. Sea transport is already the most environmentally advantageous method of transporting goods – ships will emit as little as 5% of CO2 compared to a road vehicle per tonne-mile and zero emission technologies for short sea shipping are closer to maturity than for cross-ocean transits.

A holistic approach to taking more freight off the roads and moving it around the coast by sea would greatly reduce the carbon footprint of transportation. Regional ports would offer local onward transportation, electric road vehicles being optimised for short haul routes. Integrated transport logistics should facilitate the onward transportation of longer inland transfers by rail (electrified or green hydrogen).

Much port infrastructure to enable this already exists. The UK has over 200 operational ports. Some have up to 20 ships calling per day, but most have less than 3 calls per day. These numbers suggest that many cargo ports may be less stretched than other parts of the UK transport system, enabling the start of a modal shift. In the short to medium term infrastructure investment will of course be required to decarbonise and automate operations.

The potential benefits of improved freight management include; lower unit costs; smaller carbon footprint; fewer HGVs (and drivers required) on arterial routes; and improved service reliability.

More widely we should be looking to reduce the requirement for transportation of freight overall – moving supply chains closer to home and promoting regional trade over global trade. This might include introducing a carbon tax by freight tonne-mile and support for manufacturers to re-enter markets where manufacturing has moved out of the region. This would also have the potential benefit of improved supply chain resilience.

What further action is needed by the International Civil Aviation Organization and International Maritime Organization to drive emissions reductions? What can the UK Government do to drive international action on emissions?

The current IMO regulations (EEXI and CII) are focused on vessel emission reductions. EU and other initiatives such as the Sea Cargo Charter, Poseidon Principles, Clean Cargo Working Group, Environmental Ship Index, Clean Ship Index are also focused on vessel reductions. Greater standardization and simplification is required rather than more vessel focused initiatives and more research into the consequences of changing regulation should be conducted to better understand its effects.

Action is required at a higher, more systemic level to incentivise regional trade and modal shifts in freight transportation (eg through taxation and tariffs). The UK Government should use its leadership and influence in forums such as COP26, G7 and G20, encouraging a longer term and more systemic view with Governments making more strategic and coordinated infrastructure investments.

UK Government action at a local level can also act as an example and motivator for action at an international level. At this stage enabling the shift to alternative fuelled vessels is paramount, driving regulatory aspects, supporting infrastructure and incentivising markets to shift. Currently, there is no effective ‘carrot’ to offset the ‘stick’. The UK Government could stimulate the green maritime industry (and the shipbuilding and conversion industry as a whole) by encouraging and supporting the uptake of emerging technologies. This should not just be at the low-TRL levels as at present, but in helping R&D through the higher TRL levels as previously discussed. Further support should be given to the ship buyer and ship builder to enable the low-risk adoption of such technologies. Such incentives should de-risk the cost of purchase and installation.

Across the UK we can enable networks of connected waterways and coastal sections that provide both functional and beautiful locations for rapid growth in electric markets, supporting both owners to shift and tech companies to grow. These pockets can ultimately join up and develop a, potentially, full UK network for e-charging and enable our own UK maritime ecosystem to flourish. Increased zero emissions would be the by-product of economic growth. We have the opportunity for the UK to be world leaders and first adopters for several aspects linked into zero emissions. Although there are other countries developing e-vessels we are strongly placed to certain be part of the first wave, if not lead, in how to adapt our coastal fleets.

Currently the targets in place do not give an understanding of “how” any of this will be achieved, just that the sector needs to respond to the target set. There does need to be further engagement with the whole sector, with a commitment to support and provide infrastructures for shore side power and charging facilities, supporting a range of alternative fuels.

There needs to be support for research into a wide number of areas including, emissions and impact to the environment, fuel developments, mechanics and engineering, naval architecture, shore side infrastructure and impact on marine life.

We can support a significant shift in our own waters, which will benefit our immediate neighbours, enable them to transform and provide the technology and expertise to drive a global shift.

How effective will the global offsetting scheme for international airlines (ICAO’s CORSIA) and the UK and EU ETS be at stimulating technology improvement and/ or behaviour change to reduce emissions from aviation / shipping?

Offsetting schemes and carbon trading can be useful mechanisms for increasing investment in reduced emissions projects and penalising hard to decarbonise industries, but risk enabling governments, companies and other organisations to delay action on some of the most pressing challenges. Greater monitoring of offset projects is required to ensure they are truly effective and a closer linkage between carbon emissions and offset action should be required to ensure that challenges are being addressed.

Simpler Carbon Tax schemes that directly re-invest in zero emission projects/technologies are a more effective way to drive change.

How should the UK define its ownership of international aviation and shipping emissions (i.e. arrivals, departures or both) in order to include them in legislative targets?   

There are a number of obvious and well-defined potential criteria for taking on responsibility and ownership of shipping emissions, including operation in UK territorial waters, registration with the UK Ship Register as well as port arrivals and departures. Careful modelling and consideration will be required of the criteria in conjunction with the proposed legislative targets to understand the potential effects and identify possible unintended consequences.

Use of the UK Ship Register to apply bold tax incentives or other measures could encourage fleet owners to move from flags of convenience and increase the UK’s value and influence exponentially. Simple, transparent and measurable criteria and targets that do not regularly change will be important. A range of methods and data points should be considered, not just transportation emissions, but also the impact on manufacturing, the workforce, communities and marine life.

Change will not be easy and there will be inevitable resistance, but engaging internationally and with wider society will create the momentum and incentives necessary to drive it through.

September 2021