Marine Transportation Issues Related to Climate Change

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Marine Transportation Issues Related to Climate
Change

• James J. Corbett
• Transportation and Climate Change IPIECA
  Workshop
• Baltimore, MD
• 12-13 October 2004

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To move freight at lowest CO2

• Move by water modes, low fuel-use and low cost
• Oceangoing ships, less than 20 knots
• Large bore diesel engines, possibly petroleum
  fueled
• 16-20 times the air freight distance for same CO2
• 4-6 times the truck distance for same CO2
• Pursue environment goals at least fuel penalty
• Avoid most proven air pollution technologies
• Resist adopting new ballast water technologies
• Favor high-performance (if toxic) hull coatings
• Despite this, trade growth will increase CO2

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To reduce freight transport CO2

• Control trade growth, perhaps reduce trade
• Trade increasing CO2 between 1-2 per year
• Co-locate factories, resources, markets
• Ignore labor, raw materials, consumer economic
  constraints
• Avoid less-than-truck-load (LTL) shipments
• Transport fully loaded containers, vehicles,
  vessels
• Reconsider just-in-time (JIT) logistics
• Ship at economy speeds and routes

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Unique aspects of marine transport and climate
change

• Important part of global trade (less visible)
• Decades long service life for ships (changes
  slower)
• World average 26 years, longer for U.S. fleet
• Fewer vehicles, simpler fuel infrastructure
• 100,000 internationally registered ships
• Most fuel sales in major ports (5 nations account
  for 54)
• May be market-optimized for low CO2, but a
  significant source of air emissions
• Fuel costs 20-50 of total cost (with capital,
  labor)
• May be modified uniquely by climate change

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Energy used dominated by cargo vessels using
2-stroke (slow-speed) diesel engines

• About 67 of these ships are powered by
  four-stroke compression-ignition engines
• Some 26 are powered by two-stroke diesel engines
• 27,000 two-stroke marine prime movers account for
  almost 60 of the fleets total energy output and
  fuel consumption
• Approximately 84,000 four-stroke engines with
  total installed power of 109,000 MW
• some 27,000 two-stroke engines with total
  installed powerof 164,000 MW.

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Fuel Costs as Percent of Total Costs of
Containerships and Tankers (note effect of U.S.
capital subsidies and labor differences)
US Army Corps of Engineers, Economic Guidance
Memo 02-06 FY 2002 Deep Draft Vessel Operating
Costs. 2002
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Maritime Transportation is vital component of
international trade

• U.S. waterways move 2.1 Billion tonne-km
• Relative share of cargo by water is 22 to 24
• Truck, rail account for 25 to 29 in U.S.
• 67 of consumer goods move by water
• 95 of all trade tonnage moves by ship
• Globally, more than 13 Billion tonne-km moved by
  35,000 oceangoing ships
• Projected to double from 1998 to 2020
• Current growth is on track to achieve this
• Second largest part of the U.S. service sector

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Maritime Transportation EmissionsEvolving
Global Consensus
Previous views about ship emissions 2 of CO2
therefore not significant Offshore, so no
impact Pollution difficult to control
Current understanding 14-30 NOx, 5-10 SOx,
2-4 CO2 from fossil fuel Nearshore and long
range impacts of pollution Feasible technologies
at reasonable costs Policy needed
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Global ship traffic density (2000-2002)
85 percent in Northern Hemisphere70 percent
within 400 km of land
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Trends in maritime use and emissions

• Increased trade increases transport energy
• Seaborne trade trends, fleet trends
• Increasing trend in both trade and energy use
• Slightly less energy intensive as fleet
  modernizes
• Fuel change can take decades in best case
• First transition to alternative fuel coal to oil
• What if logistics matters more than mode?
• Freight network has modal CO2 cost tradeoffs

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Increased seaborne trade and shipping tonnage
related to invasive species, other marine
impacts. Can climate change affect impacts of
marine transportation system?
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Technology shift during last centuryTransition
by number of ships slower than by tonnage
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International marine fuel sales (OECD) nations
andworld seaborne trade (IEA and UN)Annual
growth rate 2 for marine residual fuel sold
and 3.5 in seaborne trade.
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Oil saved 78 in fuel costs, gained 30 in
cargo space, and reduced crews Yergin, The
Prize, 1991
With these strong economic motivations, it still
took 5 decades to transition
Source Lloyds Register of Shipping Statistical
Tables for 1914, 19351939, 1947, 1958, and 1963.
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Does freight logistics matter more than mode?
Interdependence of Multi-modal Freight
Transportation System
Potential Substitutes
Modal Complements
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Truck, Rail and Water Segments of 1 Million Tons
or More
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Waterway network connects global logistics
Source GeoFreight 2003, U.S. Dept of
Transportation
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Maritime Gateways International Shipping
Affects All Modes (Maritime Cargo by Truck, in
tons)
http//www.ops.fhwa.dot.gov/freight/index.cfm
http//www.ops.fhwa.dot.gov/freight/index.cfm
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Illustration of the logistics supply chain
emissions model a) Freight Origin Zones b)
Freight Destination Zones in the U.S.
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Cargo transport is most fuel efficient by Ship,
then Rail, then Truck
Source IMO Study on Greenhouse Gas Emissions
from Ships, MEPC 45(8), 2000.
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Consider logistics supply chainOne retail
shippers CO2 footprint for 2003
The question may be which supply-chain
alternatives achieve greatest CO2 reduction at
least cost
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Relationship between CO2 and shipping cost
Considering only freight rate (not transport
time), a low-CO2 supply chain may cost less
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Options for action in maritime transport

• Technology fixes
• No silver bullets among competing goals
• Potential CO2? limited in range of 1-20, w/
  combos
• Operational changes
• Greater opportunity, but economic barriers
• Potential CO2? in range of 1-40
• Involves shipper, carrier, technology provider,
  fuel provider
• Policy drivers may create incentives

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Reduction potential less than fleet growth
Source IMO Study on Greenhouse Gas Emissions
from Ships, MEPC 45(8), 2000.
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Comparison Automobile potential CO2? appears
significant Fuel Economy Price Increase
Estimates for Moderate Improvements Achievable by
2010-2015
Source DeCicco, et al, ACEEE, June 2001,
http//www.aceee.org/pubs/t012.htm
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Technology as a silver bullet policy?

• Cars may achieve more reduction, sooner
• Innovations would include better air
  conditioners, more efficient transmissions and
  smaller engines.
• Regulators estimate they would cut exhaust
  emissions
• By 25 percent in cars and light trucks and
• By 18 percent in larger trucks and SUVs.
• Calif. Regulators Weigh Smog Restrictions, By TIM
  MOLLOY, Associated Press Writer, 24 Sept 2004,
  http//story.news.yahoo.com/news?tmplstorycid18
  94e1u/ap/20040924/ap_on_sc/greenhouse_emission
  s
• Achieving GHG reductions in the freight system
  may include ships both in-mode and as low-CO2
  substitute
• but ship air pollution remains the dominant
  issue

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Speed control has a much greater effect on
reducing CO2 emissions than fewer ships -- and
reduces NOx
Source IMO Study on Greenhouse Gas Emissions
from Ships, MEPC 45(8), 2000.
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Of course, if we can improve port turn-around
time, then speed control may not affect supply
chain
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NOx and CO2 Reduction Trade-Off for Marine Engines
Increase NOx Decrease CO2
Increase both NOx and CO2
Traditional Control Technologies
Operational Measures
Hydrogen fuel and Advanced propulsion
Other fuels and prime movers
Decrease both NOx and CO2
Decrease NOx Increase CO2
Source Corbett, Marine Transportation and Energy
Use, Encyclopedia of Energy, 2004.
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Introducing New Transportation Fuels Systemic
Challenges

• Synergistic reduction of CO2, conventional
  pollutants
• Network effects and economies of scale
• Centralized fueling is favored
• Power plant technology and efficiency gains
• Fuel storage, space and weight trade-offs
• User considerations where to manage change?
• Professional crews can better manage transition
  risks

Source Farrell, Keith, Corbett, Energy Policy,
2003.
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Navigating the Way Ahead Policy Mechanisms

• Traditional policy picture
• Complex, multi-jurisdictional, international
• U.S. focus is on autos, trucks and highways, not
  freight system
• Trade-offs will matter
• Market-based opportunities
• Win-win potential more rapid than regulation
• Supports modernization, sustainable growth goals
• Possible Kyoto Protocol connections
• Clean Development Mechanism (CDM)
• Emissions trading

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Concluding thoughts

• Climate change, air quality issues connected
• Transportation technologies promise a lot
• Technology may not keep up with growth
• Operational strategies may offer more
• Meeting near-term goals barriers or guides?
• Solutions must consider the market place
• Effective policies consider shipper, global
  context

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A modern fleet of ships does not so much make
use of the sea as exploit a highway.

-- Joseph Conrad

The Mirror of the
Sea, Ch. 22, 1906 Discussion welcome
http//www.riverbarges.com/riverfun/riverpics/pics
intro.htm