Amazon, IKEA and other major retailers launch zero-emission shipping tender

Zero Emission Maritime Buyers Alliance (ZEMBA), a non-profit organisation that includes major retail brands, has launched a Request for Proposals (RfP) for 600,000 twenty-foot containers (TEUs) over a three-year period on ocean vessels powered by zero-emission fuels.

ZEMBA was established in March this year by major companies Aspen Institute, Amazon, Patagonia, and Tchibo to fast-track commercial deployment of zero-emissions shipping services. The organisation also welcomed multinational retail conglomerate Inter IKEA Group as the first member to join alongside co-founders.

For this first tender, ZEMBA has secured more than 20 members, including: Amazon, Bauhaus, Brooks Running, Chewy, Electrolux Group, Flexport, Green Worldwide Shipping, IKEA, Levi Strauss & Co., lululemon, Meta, Moose Toys, New Balance, Nike, Patagonia, Philips, Schneider Electric, Sport-Thieme and Tchibo.

The ZEMBA RfP is seeking bids for shipping services, from individual carriers or consortiums, that achieve at least a 90% reduction in greenhouse gas emissions compared to traditional fossil fuels on a lifecycle basis. Fuel choice will address safety and land use concerns, particularly those that relate to biogenic substances.

Through this tender, ZEMBA will help its member companies reduce nearly 1 million metric tonnes of carbon emissions, equivalent to taking 215,000 cars off the road. 

Delivery of shipping services powered by new, cleaner fuels is anticipated in 2025.

“Maritime shipping is an essential service for global companies like Amazon, and we urgently need this sector to make clean fuel investments to reach our climate goals,” said Adam Baker, Vice President of Global Transportation at Amazon.

“Decarbonizing the global movement of our cargo requires collaboration. We know from experience that moving an industry cannot be done by individual companies but is best achieved by a collection of forward-thinkers who are ready to show the way, as leaders together,” said Paolo Galli, VP Group Logistics, Electrolux Group.

“ZEMBA allows us to come together to advance a transition we cannot facilitate on our own, and show the entire value chain that we must have a zero-emission shipping solution that is affordable, scalable, and long-lasting.”

ZEMBA will consider bids that meet the following criteria:

• Sufficient capacity to cover ZEMBA members’ aggregate demand of 600,000+ TEUs across a distance of 6,000 nautical miles/~11,000 km over three years.
• Access to fuels that provide GHG emission reductions of at least 90% compared to traditional fossil fuels on a lifecycle basis.
• Transparent fuel lifecycle emissions to validate emission reduction claims. This will be enabled through rigorous in-sector book-and-claim approaches that assure highly credible emissions reductions, while allowing companies to maintain reliable supply chains necessary for our global economy.

Through the RfP, ZEMBA will negotiate a “green premium” for the aggregated demand of its members. The green premium accounts for the added cost of operating a vessel using zero-emission fuels. Final contracting will be bilateral between ZEMBA members and the winning bidder.

Additionally, as part of the RfP bidding process, ZEMBA is requesting vessel and fuel assurances from bidders. The winning bidder will also be required to provide third-party verification of the emissions reduction ZEMBA members can claim.

ZEMBA’s RfP is focused on stimulating a new marketplace for zero-emission fuels and deploying long-term, scalable solutions for the entire shipping industry.

With this in mind, future RfP criteria for lifecycle emissions may move upward from 90% as technology innovation unfolds and sustainable fuels, infrastructure, and supply chains are implemented, according to ZEMBA.

“This RfP is a significant milestone toward a zero-emission maritime future,” said Ingrid Irigoyen, President and CEO of ZEMBA. 

“With over 20 climate-leading companies engaging in ZEMBA’s inaugural tender process, and more to come, we’re building the business case for a surge of investment in zero-emission maritime solutions, including new fuels and technologies that are not yet commercially available.”

ZEMBA’s RfP was developed in association with partners from Lloyd’s Register, a provider of classification and compliance services to the maritime and offshore industries, Neoteric Energy and Climate LLC.

The global shipping industry accounts for 3% of global climate emissions, more than global air travel. If shipping were a country, it would be the world’s sixth largest climate polluter. But since maritime shipping negotiated itself out of the U.N. Paris Agreement, the effort to reduce emissions in the industry has been slower than in other sectors.

Approximately 90% of the world trade is transported by sea, and current business-as-usual scenarios project emissions will grow up to 50% over 2018 levels. While the International Maritime Organization (IMO) noted increased ship size and operational improvements aimed at creating better fuel efficiency have resulted in a decrease in emissions intensity, annual absolute emissions are still increasing.