Emanuele Grimaldi: "The adoption of alternative fuels is the most influential trend in shipping”

Emanuele Grimaldi, Chairman of the International Chamber of Shipping (ICS), discusses the outcomes of the recent IMO MEPC 81, safeguarding seafarer wellbeing amid increasing geopolitical conflicts and how technology trends are shaping the industry.

Among other things, he also talks about how the adoption of alternative fuels has already sparked wholesale innovation in the sector and will continue to be the most influential trend in shipping.

During the 81st session of the IMO’s Marine Environment Protection Committee (MEPC 81) in March, the ICS proposed a system to bridge the cost gap between conventional and fossil-free fuels, incentivise their adoption and support the GHG reduction efforts of developing countries. How will this system work?

The ICS has proposed the adoption of a Zero Emission Shipping Fund (ZESF) to provide certainty and guidance to the industry, setting a clear path towards decarbonisation. At its core, the fund operates on a fund-and-reward ‘feebate’ structure, into which every shipowner would be required to pay, based on their fuel consumption. Shipowners who use lower-emission fuels would then be eligible for rebates from this fund to provide a bridge between the cost of traditional fossil fuels and the new more expensive net zero fuels. Pragmatically, ships would make annual mandatory contributions per tonne of CO2 emitted to the ZESF using verified data already used by the IMO Fuel Oil Data Collection System, which they already have to report into, thus ensuring smooth and transparent implementation without the need to create more bureaucracy. The proceeds of the fund would also be reinvested into supporting developing economies. This includes funding for infrastructure development, giving nations the chance to invest in smart and sustainable ports that could potentially become hotspots for the production of new fuel bunkering.

MEPC 81 failed to reach a resolution regarding the review of the Carbon Intensity Indicator (CII). What factors contributed to this outcome and what steps are anticipated to be taken next?

As a co-sponsor of the resolution, the ICS was disappointed to see that the proposal clarifying the current status of the Carbon Intensity Indicator (CII) rating system did not receive sufficient support from member states during MEPC 81. However, we were heartened to see wide acknowledgment of the need to address the irregularities that have emerged in the operation of the new regulations. For example, efficiently operated ships could receive poor ratings due to factors outside of their control like port wait times. This heightened awareness is a positive outcome that lays a strong foundation for the ongoing CII review, as it is vital to have a workable system to ensure that the industry reduces emissions. The ICS trusts that all delegations can work towards an improved CII system that incentivises correct behaviours and fully aligns with the objectives of the 2023 IMO GHG Strategy. The ICS has created a CII data collection system that allows shipowners to provide information that will inform the IMO’s formal review, which is due to be completed by January 1, 2026.

Conflict in the Gulf of Aden, the Red Sea and the Bab el-Mandeb Strait has posed significant risks to seafarers’ safety and wellbeing. How is the industry responding to ensure the safety and mental health of crew members in these dangerous waters?

The ICS strongly condemns the targeting of innocent seafarers in the Red Sea and the Gulf. Seafarers have been killed and others are being held hostage. This is wholly unacceptable and presents a risk not only to the physical health but to the mental health of all those on board. Preparedness is essential for ships transiting the region. We suggest that all ships should conduct a thorough threat assessment and liaise closely with military forces to ensure that they are fully protected against further possible aggression by hostile forces. Last month, in a letter to the UN Secretary-General, António Guterres, we called for an enhanced coordinated military presence, with missions and patrols in the region, to protect our seafarers in this turbulent period.

In 2019, the ICS and ECSA, supported by the Asian Shipowners Association, released a survey suggesting that Internet access for seafarers can improve mental health and wellbeing. What additional measures could be taken to support seafarers in this area?

Increased onboard connectivity has wide-ranging benefits, as providing seafarers the chance to speak regularly to family and friends can boost mental health. Also, adopting telemedicine support provides a great opportunity to improve emergency and post-emergency care. One of the most important measures to improve seafarers’ wellbeing while onboard is the provision of comprehensive medical care training for both physical and mental illnesses. Having access to easy-to-follow guidelines that are appropriate to the medicines and equipment that seafarers have at their disposal is key to providing effective medical treatment. Combatting harassment and bullying on ships is another essential way to support seafarer mental health and wellbeing. The ICS and its global network of shipowners and operators have produced a set of industry principles for establishing effective measures to address and eliminate these issues, published on the website following the recent ILO Violence and Harassment at Work report. Shipping companies should take mental health issues as seriously as physical injuries and ensure that, if a mental health crisis occurs, the seafarer should receive immediate expert assessment and advice from mental health professionals.

With ship systems becoming increasingly interconnected to the outside world, the industry has naturally become more vulnerable to cyber threats. However, cybersecurity adoption presents several challenges, such as funding constraints, a lack of skilled personnel and the absence of robust standards. From the industry’s perspective, what is the biggest obstacle and how can it be effectively addressed?

Cyber risk management remains at the forefront of shipowners’ and operators’ minds. As onboard digital systems become more interconnected and complex, so does identifying and managing the cyber risks. The main challenge to any security threat is preparedness, so the cybersecurity awareness of personnel will always be key. The growing linkage between Information Technology and Operational Technology is also an area we are observing closely, though developments through the International Association of Classification Societies (IACS) and industry guidelines will meet those challenges in the immediate term. As threat actors adapt their attack mechanisms, the shipping industry will continue to meet the challenge of ensuring that ships operate safely. The ICS guidelines for Cybersecurity Onboard Ships are a very useful resource, helping to identify and mitigate risks. The shipping world can capitalise on the benefits of becoming more digitally connected but we must be vigilant and aware of any issues that might arise.

Which technology trends do you believe will exert the most significant influence on the maritime industry by the end of the decade?

The adoption of alternative fuels has already sparked wholesale innovation in the sector and will continue to be the most influential trend in shipping. To meet the global growing demand for low-carbon fuels, it is crucial to produce them where they can be readily available in strategically placed hubs. One plan at the forefront of innovation is the Clean Energy Marine Hubs (CEM-Hubs) initiative, a cross-sectoral and public-private partnership initiative under the Clean Energy Ministerial that aims to create the infrastructure that forges this link between production and consumption. CEM-Hubs will enable the shipping industry to work with governments to facilitate supply chains for clean energy, presenting an economic opportunity to develop infrastructure that will soon become central to the wider shipping ecosystem. Emerging economies will also have an opportunity to transition into producers and exporters of net zero-carbon fuels to meet the demand from Europe, Asia and North America. However, the introduction of alternative fuels will take some time. In the meantime, we must also focus on technology that maximises energy efficiency, as this will be crucial to decarbonisation and reducing running costs to ensure future profitability. These include measures that address underwater radiated noise or hull friction, such as the Hull Air Lubrication technology installed on the state-of-the-art Grimaldi Group 5G class vessels to improve their efficiency performance.

(This interview first appeared in the May edition of GOLD magazine. Click here to view it.)