Shipping is cutting CO2 emissions

19th October 2015

For anybody who is concerned that further growth in international trade and shipping will result in more pollution and more global warming, there is now evidence that this risk is being tackled and actually reduced.

At least three factors have considerably cut the fuel consumption of containerships. One facet is slow-steaming, the trend towards larger, more fuel-efficient ships and restrictions placed by government on ships coming into the ports.

The outcome? As average ship size on the Asia-North Europe route increased by 40% over the five-year period to 2013, CO2 emissions per round-voyage slot dropped by 35% (see chart below). Furthermore, as average containership sizes increased by a further 23% between 2013 and 2015, it follows that emissions per unit of capacity must have continued to fall (more recent data is not available).

Global container trade grows by 4-5% a year, so fuel efficiency gains of 6-8% a year mean that fewer tonnes of CO2 are pumped by containerships into the atmosphere than before. For example, in 2014, Maersk Line carried 7% more containers than the year before and reduced fuel consumption by container shipped by 8% – resulting in a net fall in the amount of fuel consumed and in associated CO2 emissions.

Of course, there is another reason why container shipping lines are reducing pollution from ships: by reducing fuel consumption, they also reduce their operating costs. Since 2007, Maersk Line has achieved a 25% reduction in CO2 per container. If the carrier had not improved its energy efficiency and CO2 performance, the fuel cost in 2012 would have been US$1.6 billion higher. Similarly, China Shipping Container Lines spent less money on bunkers in 2013 than in 2012, despite shipping 2% more containers.

For exporters and importers, lower ship consumption has translated into lower freight rates and a lower carbon footprint (from their company’s international trade), but also longer transit times. In port, where pollution from all sorts of ship emissions is a particular problem, substantial progress has also been made.

The difficulty with government rules on the use of low-sulphur fuel is that they could cost shipping lines and shippers more money due to the price differential between cleaner bunker oil and high-sulphur oil. Yet, overall, international shipping is playing its part to protect the environment and the measures taken so far by both government and the private sector seem to have been very effective.

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