Green corridors: can they catalyze the transition to zero-emission shipping?

Green corridors are coming forth as the central link that is expected to facilitate the shipping industry’s transition to alternative fuels and full-scale decarbonization. Several green corridors are already in the making linking ports within Europe or those connecting Europe with Asia and America.

In August, the world’s two top ports, the Port of Rotterdam and Maritime Port Authority of Singapore announced a memorandum of understanding (MoU) to establish the world’s longest Green and Digital Corridor.

The two port authorities agreed to create a broad coalition of shippers, fuel suppliers, and other companies to work on potential solutions to address challenges relating to costs, availability, safety, and restrictions in the range of alternative fuels.

But what are green corridors?

Green corridors are shipping routes on which there are commercially operating ships using exclusively alternative fuels, as defined by the Maersk Mc-Kinney Moller Center for Zero Carbon Shipping.

The three main corridor types include a single-point corridor, which establishes zero-emission shipping routes around a particular location, point-to-point corridor, basically single-route corridors between two ports, and network green corridor, which establishes routes between three or more ports where vessels can burn alternative fuels.

A total of 24 global governments have so far signed a declaration to establish “green shipping corridors” between two or more ports. The collective aim is to support the establishment of at least 6 green corridors by the middle of this decade, and many more after 2030.

There is more to it than just calling a corridor ‘green’.

There is a number of considerations that go into the planning and development of a green corridor revolving around vessel types that would be sailing in the corridor and their future port and bunkering infrastructural requirements, availability of alternative fuel supply as well as cargo demand dynamics.

Maersk Mc-Kinney Moller Center has released a blueprint defining key steps to determine the feasibility of a green corridor.

The blueprint points to five key pillars for a corridor baseline, those being:

1. Identify sources of alternative fuel best suited to meet future demand, considering import options, announced projects, renewable energy/feedstock availability
2. Identify the current and expected storage and bunkering infrastructure along the corridor (based on geography, fuels, segment, volume, etc.)
3. Specify the characteristics of vessels in the corridor (incl. types, sizes, ages, fuel consumption, voyage characteristics), technical profile, and emissions
4. Develop a holistic understanding of the trade flows incl. type (cargo types), nature (e.g., origin-destination, transshipment), and ownership (BCO, FF1)
5. Assess the high-level financing and regulatory characteristics on this route

For a green corridor to become feasible it is also critical to identify potential gaps and risks from an economic, technical, and regulatory perspective, and define potential mitigating actions. Finally, a roadmap needs to be developed containing required commitments and milestones from the involved stakeholders to track its progress.

Hence, setting up a green corridor is a massive undertaking that will require private and public partnerships and collaboration as they work to mitigate risks and define clear steps and activities to decarbonize the maritime supply chain.

Green corridors should be part of IMO GHG Strategy

The World Shipping Council wants green corridors to be integrated into the IMO Greenhouse Gas Strategy as they offer ‘ a mechanism to introduce low and near-zero GHG fuels’.

“Green corridors present two opportunities. They are a place to establish experience with the use of new fuels and they allow the first movers to have the conditions to introduce ships capable of using them. The second is ‘equitable transition’ as green corridors can serve as a very significant mechanism for issues of equity. Green corridors can be developed between developed and less-developed countries with explicit programs that enable the transition to occur in different places around the globe in an organized manner,” Bryan Wood-Thomas, Vice President of the World Shipping Council, said in a recent webinar hosted by the council.

“For this reason, we are suggesting that the IMO explicitly incorporates green corridors with stipulated criteria into the IMO GHG Strategy.”

The proposition is part of a paper the council submitted in August to the IMO MEPC79.

“We have made three recommendations for the consideration of the member states and others at the IMO regarding modifications we believe would enable the organization to move faster and more efficiently,” Thomas added.

These also include a recommendation to reduce the number of steps in setting the GHG fuel standard from six every five years to two or three steps. Thomas said that energy production was a difficult process as it is, therefore, setting up so many different steps might end up stalling the transition process. The council also suggested that a life cycle analysis (LCA) well-to-wake concept should be used as a benchmark for defining GHG emissions metrics to improve environmental outcomes.

A tool for tying national strategies with shipping’s decarbonization

Christopher J. Wiernicki, ABS Chairman, President, and CEO, believes green corridors have the potential to be more than just a test bed for shipping emission projects.

Speaking at the Global Clean Energy Action Forum, the joint convening of the Clean Energy Ministerial and Mission Innovation Ministerial on 22 September, Wiernicki said that since green corridors will tie into national clean energy transition strategies highlighting shipping as a value enabler and the transport vehicle for the clean energy transition.

He explained that only green shipping corridors had the potential to address the complex challenge of decarbonization at pace and scale.

“At the root, green corridors represent a unique model of a successful public-private partnership that recognizes that in the end success to get to net zero on time and on target will be a team sport. One of the unique challenges with shipping decarbonization is the numerous moving parts, since the industry is diverse, disaggregated, and globally regulated. Green corridors help to shrink the challenge of coordination between fuel infrastructure and vessels, within the value chain and between regions, down to a more manageable size while retaining scale,” said Wiernicki.

“We need a green corridor playbook to address key performance indicators, common language, data and risk management. This will help in putting together the right policies, financial incentives and regulations. Green corridors will help us determine the right balance between managing risks and achieving business success.”

For green corridors to reach their full potential they need to become more than a series of disconnected shipping decarbonization projects. Instead, they can serve as an organizational framework connecting low- and zero-carbon shipping to broader regional, national and international decarbonization initiatives.

“They have to be tied into national clean energy strategies,” he said.

Finally, the key success factor in all corridors would be reliable data to create trust between the many partners. Therefore, the stakeholders need to develop a clear structure for measuring and reporting data in a transparent manner. 

” This will require the development of a framework for independent verification and certification to demonstrate maturity levels, with an ongoing mechanism for maintaining and sharing data. In turn, this will require verification, particularly of carbon metrics, to ensure ongoing transparency and reliability of data,” he pointed out.

Removing uncertainty and investment risk

In conclusion, green corridors can be the answer to two main challenges the industry faces at the moment: uncertainty over the future availability of alternative fuels and investment risks stemming from gaps in regulations and national policies.

By aligning future efforts on fuel pathways and reinforcing mutual actions between industry and policymakers and incentivizing and subsidizing investments through national energy transition plans the cost gap for zero-emission fuels can be bridged and at the same time end-to-end solutions that de-risk investments can be created.