The Daily View: The realpolitik of carbon

SAYING something like ‘you can’t decarbonise shipping while ignoring the politics and economics of the wider global economy’ sounds pretty obvious, but hear me out.

In an interview on Friday, Lloyd’s Register chief executive Nick Brown spoke about the state of shipping’s journey to net zero, and what is in store for the years ahead, given October’s big International Maritime Organization delay.

He said that net zero would cost trillions of dollars and wasn’t going to happen without consumers and governments wanting it to.

It is clear by now that a green hydrogen economy is not going to happen for most industries; it is silly to go to the trouble of building hydrogen cars when electric vehicles are cheaper and better, for example.

There won’t be enough biofuels to run all of shipping without chopping down forests, and carbon capture has a woeful track record and pretty ropey economics.

Nuclear could be great, but is probably decades, not years, away.

So, my thorny question for a while has been: can shipping, through its unusually powerful global regulator, build a hydrogen economy all of its own, even if the rest of the world doesn’t?

Nick Brown thinks not, and isn’t alone. UCL’s green shipping wonks think it can be done, with the right policy and the kind of mega-stimulus that saw technologies such as solar and wind get going.

But since this is about policy, it’s ultimately about what voters will pay for.

Taxing one part of a supply chain doesn’t cut the emissions, it just moves them elsewhere.

Before the mess of the Net-Zero Framework, the simple carbon levy plan won previously unthinkable levels of support at the IMO. So, it’s not as if the times aren’t a-changing.

But they will have to change a lot more for the decarbonisation of shipping to get anywhere. The industry needs a better way to cut the costs of change, to remedy the impact of new taxes on states, and to make people in those states care about it.

It’s almost as if you can’t decarbonise shipping while ignoring the politics and economics of the wider global economy.

Declan Bush
Senior reporter, Lloyd’s List

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