The cost of shipping sector decarbonizationS. Himmelstein | January 22, 2020
At least $1 trillion of capital investment in land-based and ship-related infrastructure is required to halve international shipping’s greenhouse gas emissions by 2050, according to a new study by University Maritime Advisory Services (UMAS) and the Energy Transitions Commission for the Getting to Zero Coalition. If shipping was to fully decarbonize by 2050, this would incur additional investments of approximately $400 billion over 20 years, making the total investments needed between $1.4 and $1.9 trillion dollars.
The estimate of investments required is based on ammonia as the primary zero carbon fuel choice adopted by the shipping industry as it transitions to zero carbon fuels. Under different assumptions, hydrogen, synthetic methanol or other fuels may displace ammonia’s projected dominance, but the magnitude of investments needed will not significantly change for these other options.
Most of the investment would be directed toward land-based infrastructure and production facilities for low carbon fuels, which make up around 87% of the total. This includes investments in the production of low carbon fuels, and the land-based storage and bunkering infrastructure needed for their supply. The remaining 13% of the investments needed are related to the ships themselves for the equipment and onboard storage required to operate on low carbon fuels.