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Reflections on how the carbon craze will save us all from the ravishes of global warming

If anything emerged from Dubai's 28th Conference of the Parties, or COP28, it is that the role of the United Nations will become more authoritative usurping national sovereignty as it does so.

There is by now widespread public awareness in the West that the UN's World Health Organisation's (WHO) plans to take charge globally of "pandemic preparedness and response" with the unelected agency deciding when pandemics begin and end.

Back when UN agencies were being devised, in 1947, the International Maritime Organisation, which today is often wrongly assumed be a regulator, which it almost is. It then had the more tentative less intrusive name, the Inter-Governmental Maritime Consultative Organisation (IMCO). It became the more authoritatively known as the International Maritime Organisation after 1982.

One thing all agreed on at COP28 December eco summit was absolute necessity of the pursuing the current carbon craze, or reducing transport sector emissions of carbon dioxide, which is said to be the chief contributor to global warming, which is officially characterised as a planetary existential threat.

But ask Google to characterise the threat specifically, and it replies: "Hotter temperatures, greenhouse gas concentrations, more severe storms, rising oceans, loss of species, not enough food, health risks, poverty and displacement."

Not very scary, are they? Considering that many if not most of these fears are disputed or debunked, one must treat such predictions with a forensic eye given the spotty record of environmentalist predictive powers over the years.

But not so the predictive powers of cost accountants in the shipping sector. They are certain that the new regulations that have come into force - and this is only the beginning - will drive up regulatory compliance costs high enough to drive smaller players out of business and have bigger fish absorb market share that could not survive the bans and restrictions imposed by regulators.

Having a leadership role in the COP28 gathering in the Arabian oil patch, was Hayden Walmsley, of Lloyd’s Register, and its parent, Lloyd’s Register Foundation, an independent global charity with a mission to "engineer a safer world".

Mr Walmsley sees growing partnerships as driving shipping’s decarbonisation, as well as the expanding role of the IMO, creating security for investments and striving for short-term improvements.

"There is still much work to do," he said." Adoption of future fuels remains in the early stage, with 98.8 per cent of the fleet still sailing on fossil fuels, whilst 21 per cent of vessels on order have the potential to operate on cleaner alternatives according to UNCTAD in their Review of Maritime Transport 2023."

An impressive number of major players have bought into the carbon craze, it's a strong if not stronger than the woke drive to have transgenderism accepted as the new normal.

Amazon and other BCOs announced Zero-Emission Maritime Buyers Alliance (ZEMBA)
Australia announced a Maritime Emissions Reduction National Action Plan. The Port of Antwerp-Bruges is to become import hub for green hydrogen. Brazil and Port CEOs of Hamburg, Acu, Halifax and Antwerp have also joined the Clean Energy Marine Hubs. Hoegh Autoliners has invested US$1.2 billion in building 12 new net zero ammonia-ready car carriers to decarbonise international shipping. Wind Challenger – Mitsui OSK Lines wind powered vessel Shofu Maru sets sail. Wallenius Wilhelmsen has also announced green energy newbuilds for a net-zero end-to-end offering by 2027.

The thinking is that mutually encouraging  partnerships can keep the ball on the hop and discourage slacking. After all, these intentions can do bold a crazy things now after a period of windfall Covid profits and a willingness to spend the money on dream engineering of projects of one's own, rather than have the money frittered away by government on its own useless projects. The sector has its own dreams and schemes, which can be virtue signalled as God's work to the compliant media. But if times get tough, as well they might, then conservatives' cost cutting argument will hold sway again.

But for the moment talk is of partnerships. Take the Castor Initiative, a project namechecked multiple times by Capt Rajalingam Subramaniam, CEO of Kuala Lumpur-based Malaysia International Shipping Corporation (MISC) at the International Chamber of Shipping’s Shaping the Future of Shipping summit.

That global coalition, which includes MISC Berhad, Lloyd’s Register, Samsung Heavy Industries, MAN Energy Solutions, the Maritime and Port Authority of Singapore, Yara Clean Ammonia, TotalEnergies and Jurong Port, was established in January 2020 to develop an ammonia-fuelled tanker design.

Said Lloyd’s Register CEO Nick Brown: “We are on track to getting these first deep sea, zero emissions ship into the water with regular repetition from 2026 onwards."

For Capt Raja, bringing onboard the financiers is the next step for the partnership. This is something which the Lloyd’s Register Maritime Decarbonisation Hub has already achieved with The Silk Alliance.

The current membership of the Silk Alliance comprises stakeholders across the entire value chain of shipping, involving both private and public organisations, including two financial institutions. The Silk Alliance was also recognised by the Green Shipping Initiative for identifying its first baseline fleet for Singapore Cluster and calls for further collaborators.

One would think it unusual that an industry would welcome increased regulation that would constrain its activity, having every initiative henceforth wending its way up the regulatory ladder for approval. But there are those in oligopolies who see the growth of the regulatory state more as a fortress against intrusive innovation than a prison preventing escape from constraint. The presence of rules and regulations protects one from innovation and the failure to seize obvious opportunity can invariably blamed on the rules that neither insisted on it or authorised it.

So speaking for the delegates, Intercontinental Energy CEO Alicia Eastman said: “We need to have a cost to the negative externalities of fossil fuels, Buyers should not have to choose between something produced correctly, a zero emissions fuel, and one with pollutions attached to its production.”

Really? One should not be forced, she says, to choose between a polluting fuel that works or "something produced correctly, a zero emissions fuel". Trouble is, as well she knows, such a fuel is not available in quantities needed to drive the 98.8 per cent of the fleet still sailing on fossil fuels, or it is available in such limited quantities that it is only of use to the richest of the rich service providers, carrying goods that are only available to the richest of the rich consumers.

There is little evidence to justify the current carbon craze other than the phantom of global warming, aka climate change. Neither is there evidence to suggest that climate change is a clear and immediate danger - quite unlike the regulatory jungle that stifles dissent and threatens to extinguish democracy. Perhaps it is wise to consider the menace of safety when considering proposals offered by the likes of Lloyd's Register Foundation, bent as it is on "engineering a safer world".

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Though much beloved by officialdom, will climate change be as fussworthy as Covid? Does it pose a threat to our democracy?

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China Trade Specialists