Time to act
The modelling of ‘the path we are on’ includes realistic forecasts for the growth of shipping, implementation of energy efficiency measures, cost and availability of renewable energy, consumer behavior, finance cost and all relevant regulation that has been implemented. It shows that if we do not change course the path we are on will lead to around 20% more GHG emissions by 2050. This is very far from the 1.5-degree and the well below 2-degree pathways outlined by the IPCC.
Industry leadership is gaining momentum but even if all current shipowner decarbonization commitments are delivered as promised only 22% of global maritime transportation will be net zero carbon by 2050. This momentum would almost exclusively be driven by the container industry. Tanker and dry bulk are more fragmented, and leadership is only just emerging. The main risk is that industry leadership could lead to margin erosion for the front runners if customer willingness to pay is weak and the substantial cost gap between fossil and alternative fuels (e.g. e-methanol, e-ammonia or biofuels) is not closed by regulatory intervention.
If the path we are on materializes, the global maritime fuel mix would consist almost exclusively of LSFO and LNG by 2050. Energy demand from the maritime industry would grow because improved energy efficiency cannot offset transport demand growth. Although long-term trade volume forecasts are uncertain by nature, we use an estimate for global trade growth of 1.3% p.a. on average, which if realized would increase industry trade volumes by 50% over the next three decades.