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Mediterranean Shipping Company, the world’s second largest container shipping group, has publicly announced its commitment to reach net zero carbon emissions by 2050 for the first time.
Chief executive Soren Toft said the privately owned Italian-Swiss conglomerate aimed to achieve carbon neutrality within 30 years following pledges by peers such as Denmark’s Maersk and France’s CMA CGM.
“We are also committing to a net zero carbon future with shipping lines such as ourselves seeking to reach net decarbonisation by 2050,” he said speaking at London International Shipping Week on Wednesday.
Shipping contributes almost 3 per cent of global CO2 emissions but the sector is difficult to decarbonise because alternative fuels such as hydrogen, ammonia and methanol cannot yet be produced at scale without generating emissions.
Pressure is mounting on the industry to raise its commitment to decarbonisation beyond the current aim set by members of the International Maritime Organization, the UN body that regulates shipping, of at least halving the industry’s greenhouse gas emissions by 2050 from 2008 levels.
MSC said in 2020 it recorded a 44.3 per cent reduction in relative CO2 emissions compared with a 2008 baseline.
Critical months lie ahead for decarbonising shipping, with world leaders gathering for COP26 in Glasgow and the next large climate change meeting at the IMO in November. The global regulator plans to revise its global emissions reduction target by 2023.
Zero emission ship technologies look likely to be developed by the middle of the century but governments need to agree on a global carbon tax to make the cost of green fuels competitive with heavy fuel oil.
MSC is poised to overtake rival Maersk as the industry’s largest company by vessel capacity, which would draw more attention to the company’s response to decarbonisation issues. It is the sixth largest emitter of carbon dioxide in the EU, according to Transport & Environment, a European campaign group.
The company is in the throes of change after Toft, who joined MSC at the end of last year, shocked the industry by leaving Maersk to become the first outsider to take the helm of the group owned by the Aponte family.
Toft declined to specify a net-zero target in an interview with the Financial Times in June, when he said setting targets was a “nice thing” to do but MSC was more focused on taking action by bringing together shipping lines with fuel producers. It has formed a partnership with Shell to develop shipping fuels to help decarbonise the sector.
Since that interview, Maersk has announced plans to invest in eight ships powered by “green methanol” in the most radical step in the industry to advance decarbonisation.
MSC remains agnostic on which engine and fuel technology to back, given the high level of uncertainty over which one will prove to be the safest, cheapest and most easily scalable.