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Shiprep Management’s participation at the Maritime Cyprus Conference 9-12 October 2022

For the first time, Shiprep Management attended the Maritime Cyprus Conference which was held in October, and welcomed shipping executives from around the globe to discuss the “Shipping Response to the 3 Cs: Crises-Challenges-Competitiveness”.  This year’s conference was attended by shipping industry leaders including the Secretary General of the International Maritime Organization, the European Commissioner for Transport, Presidents of the International Chamber of Shipping, ECSA, and BIMCO, as well as world-class maritime experts, and renowned ship owners.

The conference provided an important forum for discussing and putting into action ways to make progress in the industry.  A wide range of challenging topics was discussed concerning the rapidly changing maritime industry and the actionable measures that must be developed to meet the IMO regulations of 2050. Shipping experts discussed decarbonization, green ship financing, digital transformation, autonomous vessels, and seafarers’ rights.  The efforts of the Shipping Deputy Ministry of Cyprus to promote maritime professions and gender equality in shipping were evident, as well as the immediate actions taken by Cyprus to respond to the COVID-19 pandemic and the practical measures initiated by Cyprus to help the seafarers affected by the war in Ukraine were visibly presented to all attendees.

Decarbonization and alternative fuels

One of the topics that sparked vivid discussions on the shipowner’s panel was the contradicting environment on the alternative fuel of the future in shipping and under which circumstances. Online, some of the market participants presented the view that Oil & Gas as the major fuel will not be altered in the coming years. A way to reduce the NOx and Sox emissions could be slow steaming and speed reduction in general. On the contrary, dual fuel engines, and carbon capture solutions with the use of methanol, ethanol, or hydrogen-based propulsion engines were illustrated as the only way to meet the global emissions’ plan for decarbonization.

Mr. Polys Chatziioannou, CEO of Safe Bulkers Ltd and Vice President of Cyprus Union of Shipowners, and Mr. Giorgos Prokopiou, Chairman of Dynacom Tankers Management Ltd both discussed the importance of reducing ship speed as a weapon in the quiver of company managers to reduce emissions from the movement of commercial ships.  The lack of information and uncertainty about the future of the industry, significantly influencing investment decisions was acknowledged.  In addition, the panel suggested focusing on a narrower range of future fuels based on available technologies. Mr. Prokopiou noted that oil will continue to be a pillar of the global energy mix in the century we are passing through and that it cannot be replaced, at least in the next decades, by alternative fuels, which are considered the protagonists of the future of propulsion. Due to decarbonization pressures, the maritime industry is transitioning from conventional fuels to zero or carbon-neutral fuels. A significant impact will be felt on costs, asset values, and earnings capacity because of the transition. To plan accordingly and assess the associated risks, industry participants must now understand the drivers and implications. While regulations will set direct requirements that shipowners must comply with, the public and third-party stakeholders (governments, classification societies, ports, shipyards, banks, and cargo owners) will increasingly expect transparency and decarbonization from shipowners. Shipowners will also have to demonstrate that they can meet decarbonization targets to access financing for newbuilds.

As stated, shipping is not divided into geographical regions. It is a global industry whose challenges require global solutions.

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Decarbonizing Shipping

Climate change or global warming is indeed a reality, with people experiencing its effects every day. Extreme weather rises in sea levels and changes in the timing of seasons have affected human health by worsening food security, increasing pressure on supplies of clean water, and mass migrations of people seeking safety. Levels of carbon dioxide, a ‘greenhouse gas released by burning fossil fuels, are at a record high.

Decarbonization has become a global imperative and a priority for governments, companies, and society at large which, in turn, are making commitments and increasing efforts to close the gap to net-zero emissions.

The International Maritime Organization (IMO) has set an ambition to reduce the carbon intensity of emissions from shipping by at least 40% by 2030, and 70% by 2050.

Decarbonization was also the topic that hushed every other at SMM 2022 in Hamburg Germany, the largest maritime exhibition in the world and the first post-pandemic and in-person since 2018. This topic, the industry’s greatest challenge, was the focus on the show floor and in the conference rooms. At the show’s opening, the ICS Secretary General declared that the shipping industry can no longer remain on the sidelines, and must take its place in global discussions to ensure that the industry can secure the right energy supplies for the future.

From across SMM, the message was clear that shipping wants to move away from the sidelines but will need to be ushered along by global and regional regulations. Until regulations are in place, most companies will wait and see, only making environmental progress where there is a commercial benefit.

To realize the IMO’s ambition, progress needs to be made particularly in the harder-to-abate industries. The decarbonization of shipping cannot be solved by one organization on its own. Close collaboration between players in the shipping ecosystem and other sectors is required.

We are proud to always be on top of the global updates on the decarbonization in shipping and we are closely monitoring the best alternative fuels solutions that will be to benefit of our trusted customers from around the world.