Lubricating Bubbles May Help Branson War on Shipping Pollution
Looming United Nations measures to halve carbon emissions from commercial ships have Nippon Yusen K.K. (9101), owner of the world’s second-largest fleet, designing a vessel that is propelled by sails and glides on lubricating bubbles.
Other shipping lines are also aiming to cut greenhouse gases. China Cosco Holdings Co., the nation’s largest container-ship operator, may reintroduce nuclear power for moving cargo. A.P. Moeller-Maersk A/S, the biggest container-shipping company, already cut sailing speeds by half.
The shipping industry, the sixth-largest source of warming gases, also is the first target of billionaire Richard Branson’s Carbon War Room. Commercial vessels emitted 3 percent of the world’s carbon in 2007, and that may increase to 18 percent by 2050 as global trade increases and fleets expand, said the UN’s International Maritime Organization.
“The marine industry is gearing up for the biggest revolution since World War II,” said Lee Sokje, an analyst at Mirae Asset Securities Co. in Seoul. “You’re either ahead of the game or you’re out.”
Emissions targets being negotiated by the IMO and industry may be adopted in 2012 with fines for violators, prompting shipping companies to research renewable-energy technologies while also slowing vessels.
Penalties could reach $75 per ton of carbon emissions above a still-undetermined level, according to Det Norske Veritas, a Hovik, Norway-based ship assessor. The money would fund research and development of cleaner technologies.
“We’re hoping that a target will be set for the airline industry, a target will be set for the shipping industry and, if the industries don’t meet those targets, it will cost them money,” Branson said April 21. “Hopefully, that money will then go to the rainforest and will be invested in technological innovations.”
Cargo ships carry about 80 percent of global trade. The industry emitted 870 million tons of carbon dioxide in 2007, the IMO said. By comparison, Germany emitted 956 million tons of greenhouse gases that year.
IMO standards likely won’t be adopted until at least 2012, said Ron Widdows, chairman of the 29-member World Shipping Council, which represents the liner industry, and chief executive officer of Neptune Orient Lines Ltd., owner of Southeast Asia’s biggest container-shipping company.
The IMO proposal follows international talks in Copenhagen in December to reduce discharges of greenhouse gases and keep the global rise in temperatures since industrialization in the 1800s to 2 degrees Celsius (36 degrees Fahrenheit). The next round of UN climate talks is scheduled for late this year in Cancun, Mexico.
Nippon Yusen is spending 70 billion yen ($743 million) over five years on emissions control. Its NYK Super Eco Ship 2030 could emit 69 percent less carbon dioxide than existing carriers by using alternative energies and liquefied natural gas, the Tokyo-based line said on its Web site.
Its main power source would be LNG fuel cells, which emit 30 percent less carbon dioxide than diesel. Power also would be generated by at least eight sails and 31,000 square meters of solar panels, including on the sides.
Air bubbles ejected under the bow to reduce friction could save 10 percent on power requirements, the company said.
“Not a joke. Not a toy. Not only a dream,” Nippon Yusen’s Web site says.
The company may order two fuel-efficient car carriers this year that would reduce consumption by 40 percent, President Yasumi Kudo said.
China Cosco may revive nuclear-powered cargo ships, first introduced in 1962 with the U.S.-flagged NS Savannah. The U.S. Maritime Administration vessel was decommissioned in 1972 because of high maintenance costs.
Japan and Germany also used and decommissioned nuclear-fueled vessels.
“We are not only looking into nuclear, but also wind energy and solar energy,” said Zhang Liang, president of China Cosco. “We have to take up more social responsibility, particularly in energy saving and environment protection.”
He could not say how much the company was spending.
‘Prices Through Roof’
Yet Mirae’s Lee said the costs of building and running alternative-energy ships make them more of a dream than a reality. The cost to build a nuclear-propelled vessel may be twice that of a standard vessel, DNV said.
The biggest crude oil carrier costs about $98 million, according to Clarkson Plc. Also, the technology for putting reactors in commercial ships is “immature” and may not be viable for another 20 years, DNV said.
“Ship prices are going to go through the roof if any of these ships using renewable energy are built,” Lee said. “That’s why most of the ideas being studied now will remain just that: ideas.”
The IMO previously took steps to reduce the sulfur content in fuels to 0.5 percent from the current 4.5 percent by Jan. 1, 2020. Hyundai Heavy Industries Co. (009540), the world’s largest shipyard, last month delivered the first engine meeting IMO standards.
The quickest way to reduce carbon emissions is to slow down, according to the Transpacific Stabilization Agreement, which counts Maersk among its 15 members.
Reducing speed by 10 percent can pare fuel consumption by up to 30 percent, according to DNV. Slowing speeds by 25 percent can reduce carbon emissions by more than 350 tons a day, the TSA group said.
Clients of Singapore-based ship lessor Rickmers Maritime (RMT), including Maersk and Mitsui O.S.K. Lines Ltd. (9104), save up to $40,000 a day by halving speeds to 12 knots, said Thomas Preben Hansen, chief executive officer.
“Greenhouse reduction comes from burning less stuff,” Widdows said. “You can only do that if you go slower until other technologies come up.”
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