Japanese shipping giant unpacks carbon insetting program to slash GHG emissions

Japanese shipping heavyweight Mitsui O.S.K. Lines (MOL) has unveiled a new carbon insetting program that aims to help shipping companies and non-vessel operating common carriers (NVOCCs) that use ocean transport cut Scope 3 greenhouse gas (GHG) emissions.

According to MOL, the Blue Action Net Zero Alliance program revolves around a vision to accomplish net zero operations by ‘enhancing’ low-emission marine transportation services using alternative fuels.

It is understood that one of the stepping stones that helped launch the program were the transactions of the issued environmental attributes certificates (EACs) with three ‘major’ NVOCCs, namely, logistics corporation Nippon Express Holdings, the US-based transport company C.H. Robinson Worldwide and MOL’s subsidiary, MOL Logistics.

Giving insight into how net zero marine transportation services can be accomplished via the Blue Action Net Zero Alliance, MOL representatives elaborated that the EACs traded with customers contain environmental attributes (containing GHG emission reduction data quantified in t-CO2e units being allocated to the EACs buyers) of specific low-emission voyages performed by the MOL Group-operated fleet.

As explained, actual shippers and NVOCCs that have been allocated EACs can reflect their activities for Scope 3 reductions via marine transportation services in their sustainability reports based on the descriptions in the certificates.

The EACs themselves are traded on a book-and-claim model, which is said to allow for ‘flexible’ trading depending on users’ Scope 3 reduction ambitions as well as budget, whether or not there are any physical ties between customers and the low-emission voyages, MOL representatives highlighted.

Per the Japanese shipping titan, the MOL Group will set the proceeds from the sale of EACs aside for the procurement of alternative fuels to eliminate the use of fossil fuels.

As disclosed, the launching of the program is directly related to the February 2024 introduction of a carbon insetting pilot and the platform subsequently developed with partner, the Netherlands-headquartered 123Carbon.

The pilot—which encompassed tokenizing GHG emission reductions from a net zero voyage done jointly with Canada’s methanol supplier Methanex Corporation in February 2023—also saw MOL becoming the ‘first’ shipping player in the Asia-Pacific to issue EACs.

In its Environmental Vision 2.2, a roadmap toward its climate neutrality by 2050 targets, MOL said it identified several initiatives that can be undertaken to realize this ambition. The launch of the new carbon insetting program is described as one of the ‘vital’ links of this chain.

Believed to be applicable to all clean fuels, carbon insetting has gained significant traction in the maritime industry over the past few years.

Unlike offsetting, which involves funding external projects like reforestation or renewable energy to compensate for emissions, insetting focuses on investing in CO2 reduction within a company’s own supply chain or operations, creating a direct impact within its sphere of influence.

The ‘first’ insetting program for zero emissions shipping was launched in April 2024 by Dutch companies Future Proof Shipping (FPS), Zero Emission Services (ZES) and 123Carbon. Since then, a wide range of maritime industry stakeholders have shown a growing interest in carbon insetting, including South Korea’s HMM, as well as Denmark’s Unifeeder and Svitzer.

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