17 July 2019
Cargo ships mostly use low-grade bunker fuel that is highly polluting. Photo: Reuters
Cargo ships mostly use low-grade bunker fuel that is highly polluting. Photo: Reuters

Shipping industry, a major polluter, under pressure to clean up

What’s the biggest source of air pollution in Hong Kong? Is it vehicles, or local power plants, or factories in the Pearl River Delta?

The answer: None of these.

Actually, it is cargo shipping that is the worst polluter, as it generates 30 to 50 percent of all carbon emissions in Hong Kong.

According to the Environmental Protection Department, cargo emission has kept rising over the years, despite reduced pollution from our cars and power plants.

Cargo ships are mainly fueled by heavy oil. The low-grade bunker fuel is highly polluting, but it is used widely because of its high energy value.

Hong Kong is the world’s fifth busiest cargo port, with around 100,000 cargo ships coming and going every year. Hence, the pollution problem is not surprising at all.

On the basis of emission per metric ton per kilometer, shipping can be considered the most
environmentally-friendly freight transport.

For example, cargo shipping emits 10 to 40 grams of carbon dioxide per kilometer, far less than 30 to 150 grams carbon emissions by rail, 60 to 150 grams by road and 500 to 950 grams by air.

But the thing is, cargo shipping accounts for 90 percent of global goods transport, and carbon emissions by cargo ships continue to increase as global trade expands.

If treated as a country, the shipping industry as a whole is the world’s sixth largest polluter.

Under much pressure to improve the situation, the International Maritime Organization (IMO) is working on an emission reduction plan, possibly targeting to cut the industry’s emission by half by 2050.

New technologies will play a key role in achieving this goal. Dutch shipping company Port-Liner rolled out the first fully-electric, emission-free barges, dubbed as “Tesla of the canals”, in January this year.

The electric barge can carry cargoes weighing up to 425 tons and can run 15 hours per charge. But it’s only designed to transport goods around inland waterways; the technology does not work for much bigger vessels running international lines.

Japanese renewable energy systems company Eco Marine Power is moving ahead with plans to equip ocean-going cargo ships with rigid sails embedded with solar panels. The technology will enable ships to use both solar and wind energy at the same time.

The company will start a trial sail for 18 months this year. However, installing solar panels on the deck may reduce the amount of cargoes a ship can hold.

Meanwhile, Dubai government has hired Tesla’s founder Elon Musk to build a Hyperloop to transport containers between two ports. If it succeeds, the solution can be used in routes between US, China and Europe, which can replace most of the existing cargo shipping. But it remains a distant dream.

The carbon emission pressure is said to have contributed to a faster industry shake-up.

China’s COSCO Shipping acquired Orient Overseas (International) for HK$49.2 billion last year.

Singapore government investment arm Temasek Holdings, the majority investor in Neptune Orient Lines (NOL), had earlier agreed to an acquisition offer from French company CMA CGM for NOL.

Among other initiatives, three of Japan’s largest shipping companies — NYK, MOL, and “K” Line — had announced that they plan to merge their container shipping and overseas terminal operations.

This article appeared in the Hong Kong Economic Journal on June 6

Translation by Julie Zhu

[Chinese version 中文版]

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Hong Kong Economic Journal columnist

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