Several new requirements speed up the transition of maritime transport

Fredrik sees that there are three major trends in the shipping industry.
Firstly, regulations and requirements have increased significantly and changes are happening fast, making it difficult for many to navigate.
Secondly, there are several different strategies underway to convert the operation of ships – no one size fits all.
Finally, there is a global trend in demand for transparency and clarity in emissions data and comparability.

“From 2024, shipping in Europe will be included in the EU’s Emission Trading System, and there will also be a quota obligation for fuel. Simply put, there are two sticks forcing shipping into the transition. The fact that shipping will have to start paying for its emissions through the emissions trading system will contribute to increased costs. At the same time, the EU Fuel Maritime regulation will require ships in Europe to gradually include fossil-free fuels for their propulsion,” says Fredrik Larsson.

At the same time, Fredrik believes that the ETS may affect Sweden and northern Europe more than other countries. As an export-dependent country with long distances, the increased costs of emissions will also mean costs for companies that transport goods and commodities. For Gotland, and other islands with fewer than 200,000 inhabitants such as Bornholm and the Mediterranean islands, there is a so-called island exemption, ships operating on these routes will be included in the ETS only in 2031. Here you can find is a list of all exempted destinations.

Shipping is and has long been dependent on fossil fuels to operate. The entire system of global shipping and trade is built around the availability of the same and relatively cheap fuel worldwide. In terms of new orders, the overwhelming majority of ships are still built for fossil fuels.

“There is a conflict of interest in the global fleet transition with two fundamental issues that need to be addressed. On the one hand, there is a discussion about what fuels to use in the ships of the future. On the other hand, there is a huge need for infrastructure development and management of these future fuels. This creates a ‘chicken or the egg’ situation where fuel production and infrastructure are dependent on the existence of buyers, in the same way that shipping companies are dependent on the availability of the right fuel on the market,” says Fredrik Larsson.

It also means that shipping companies need to work with ports and fuel producers to make the transition. Of the shipping companies that invest in new technology, Fredrik sees that there are several different interesting technologies and fuel options. The challenges around which fuel depends a lot on where in the world the ships will go, what distances and what the fuel supply looks like there.

“We are now seeing several examples of how shipping companies are developing concepts and vessels for the transition, with a wide mix of technologies: from e-fuels such as methanol, ammonia and gas propulsion to wind (sails) and electrification – and developments are moving fast. Unfortunately, we don’t see the same vision for Swedish ports, where there are still challenges to connect to shore power everywhere,” says Fredrik Larsson.

Globally, there are several promising technology projects coming from Sweden. The Gotland service, which is a shipping line that operates the same route daily, has certain special conditions. Although developments are dependent on what is happening on the world market, it is possible to create our own solutions for our own traffic.

“Gotlandsbolaget’s Horizon Series and commitment to everything from fuel production to port infrastructure is one of the most exciting projects, and it is great to see how more and more people are referring to Sweden as a leader in the maritime transition,” says Fredrik Larsson.

Finally, Fredrik sees that there are four steps forward for shipping to reduce its emissions as much as possible, as efficiently as possible:

1. Energy efficiency.
   Givet den brist det finns på tillgänglig hållbar energi är det viktigt att energieffektivisera överfarterna så mycket som möjligt.
2. Electrify where possible.
   Mindre fartyg på kortare sträckor kan ofta elektrifiera hela eller delar av överfarten.
3. Global price mechanism. A strong worldwide pricing mechanism that forces emitters to also pay for their emissions.
   This provides incentives to use more sustainable fuels.
4. Sustainable fuels obligation: a duty to require fossil-free fuels drives increased production and enables faster transition.