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ISSUE 47
AGE 36
ISSUE 47 P PAGE 36
COMMUNITY TALK
ALK
COMMUNITY T

With the mounting pressure to decarbonise its
WITH THE MOUNTING PRESSURE TO practices and operations, the shipping community
DECARBONISE, THE SHIPPING COMMUNITY is facing the impact of asset cost and reduced
earning capacity as it transitions into zero-carbon
IS FACING THE IMPACT OF ASSET COST state, which could be from mid- to long-term. This
is on top of the COVID-19 pandemic, slow recovery,
AND REDUCED EARNING CAPACITY AS IT geopolitical development, uncertain energy policies,
the different pace of development, including the

TRANSITIONS INTO ZERO-CARBON STATE, WHICH high pricing, especially immature technologies. Such
challenges remain for maritime stakeholders, who
COULD BE FROM MID- TO LONG-TERM. must stay focused to navigate into the future and
make very informed decisions.
In terms of opportunities, other than expedited
MR WONG WENG SUN technology development yielding greater
PRESIDENT & CEO, SEMBCORP MARINE LTD; improvements in energy effi ciency, working towards
CO-CHAIR, INTERNATIONAL ADVISORY PANEL ON MARITIME DECARBONISATION the decarbonisation target can emerge as an
opportunity to transform the sector and become
the main infl uencer to the global supply chain. We

MODERATOR: LEY HOON HAS POINTED OUT THE could improve efficiency and response time, reduce
NEED TO ACCELERATE THE PROCESS OF MARITIME wastage, and help to improve shipping’s carbon-
DECARBONISATION. WHAT IS THE INDUSTRY’S reduction rate and profi tability. This is possible,
VIEW ON THE CHALLENGES AND OPPORTUNITIES? especially when the sector is collectively embarking
WHAT WOULD BE USEFUL OR NECESSARY FOR on early digitalisation, use of IoT, as well as adopting
THE TRANSITION OF INTERNATIONAL SHIPPING digital twin and e-connectivity, etc.
TO LOW- TO ZERO-CARBON?
ASP: I see an opportunity to leverage our industry’s MODERATOR: IN HIS OPENING REMARKS, IMO
capabilities in technology and engineering to reduce SECRETARY-GENERAL KITACK LIM SPOKE ABOUT
our environmental footprint. Additionally, I think we IMO INITIATING MARKET-BASED MEASURES TO
can lead the way on a carbon levy (or mandatory INCENTIVISE THE USE OF GREEN MARINE FUELS.
R&D contribution) because we have this unique PERHAPS ANDREAS COULD ELABORATE ON THE
entity with IMO as a global regulator. We also have CARBON LEVY HE MENTIONED AND HOW IT CAN
an opportunity to create new fuels that can be HELP IN ACCELERATING THE DECARBONISATION OF
applied across other industries beyond shipping. INTERNATIONAL SHIPPING.
In terms of challenges, the cost gap is important ASP: A levy has two sides to it: one is penalty, and
to address as the industry has been operating on the other is incentive. An increase in the cost of
low margins for a long time. Collaboration between fuel can be a penalty, but how high does it have
stakeholders — such as shipowners, engine makers, to be in order to be a real penalty? Incentives
ship builders, fuel suppliers, governments, and can be channelled back into the industry to do
infrastructure builders — needs to happen. We research and development, scaling and building
also need proper accounting and measurements in infrastructure with the purpose of achieving
order to focus on the right things. decarbonisation. If you can get those two together,
WWS: I think the main challenge is still a technical I think it could be very eff ective.
solution leading to a new substitute for marine For a levy to work, it has to be predictable
fossil fuel as well as its accessibility. At the same and it has to provide a level playing fi eld. If you
time, we need to build capabilities to overcome have a predictable price increase over time,
capacity constraint, engine development, or phasing businesses can determine which mitigation
out existing combustion engines. We also need to measures are economically feasible, and what
consider the availability of investment to support investments to make. For a levy to be eff ective in
R&D and infrastructure. a global industry, it needs to be a global scheme.