[Scott] Next on "Energy Switch," we continue to explore shipping.

The industry that brings us nearly everything.

- The whole carbon footprint worldwide is 2.7%.

That's the maritime industry as a whole.

- What's the target?

Is it even lower?

- By 2030, we need to be 30% less.

By 2040, we need to be 80% less.

And when we get to 2050, net zero emissions.

- Right.

And how is that going?

Because I'd be shocked if you said-- - It is not a kumbaya moment, no.

- Okay.

- There's not a silver bullet.

There's a lot of okay options.

- Yeah.

- Yeah.

- But there's not the one.

- But there's a lot of smart people that's looking at data.

You know, how do we make this work?

So that gives me hope.

They're adjacent to the maritime industry, but they care about sustainability and actually reducing the carbon footprint of the industry.

[Scott] Coming up, emissions, decarbonization, and potential future fuels for the shipping industry.

[Announcer] Major funding for this program was provided by Arizona State University.

Shaping global leaders, driving innovation, and transforming the future.

Arizona State, The New American University.

[upbeat music] - I'm Scott Tinker, and I'm an energy scientist.

I work in the field, lead research, speak around the world, write articles, and make films about energy.

This show brings together leading experts on vital topics in energy and climate.

They may have different perspectives, but my goal is to learn, and illuminate, and bring diverging views together towards solutions.

Welcome to the "Energy Switch."

In part one of this discussion, we learned the basics of the shipping industry.

Now, we look at its CO2 emissions.

The UN's goal is to reduce them.

Alternative low carbon fuels the industry is exploring to meet proposed UN targets and challenges to adopt those.

We'll hear what effects that might have on the industry, a brief look at other challenges like infrastructure and crewing, and a glimpse into the future.

Our experts, again, are Anna Silva.

She's the manager of cruise ops at the Port Everglades Terminal in Florida, with 25 years' experience in the industry, aboard ships, as an instructor, in bulk cargo, and cruise ships.

Margaret Doyle is a director of Transparency Fuels, a marine fuels brokerage, also with decades of experience in fuels and shipping, consulting, administration, and policy.

On this episode of "Energy Switch," we'll pull into port on Shipping: Part Two.

Well, welcome back.

If we think about shipping, and again, I don't think any of us had any idea how many thousands of ships are out there all the time, running on diesel, a lot of other things.

How much CO2 is emitted?

Let's think about it maybe on a per ton of goods basis, if we could.

And then, even the industry as a whole.

- Yeah, the way you base this is for anything in the maritime industry is ton-miles.

So how much energy it takes to move that cargo, that ship, one mile.

So as far as kilograms of CO2, it's very small.

It's 0.05.

But that's per mile of a ton of a very big ship.

And that's a ballpark 'cause that depends on the size of the ship, the routes it's on, and that... Because your emissions, there's something called CII, that the International Maritime Organization tracks, what the-- - CII.

- Yeah, the Carbon Intensity Indicator.

- Okay.

- And that is a system that no one is happy with 'cause it's very rudimentary.

It basically tracks distance, and it looks at your consumption, and you submit that information to the IMO.

So there's different ways of tracking that.

So-- - But we are trying to track it?

- We are.

We have to.

It is a requirement.

It took effect in 2023.

And that will rate your ship an A through E. And if you're in the lower, if you're getting Cs, Ds, and Es, you can't correct that, that ship is recycled in three years.

But the industry as a whole, which doesn't sound like a big number, but we're very cognizant of it as far as the whole carbon footprint for worldwide is 2.7%.

That's the maritime ministry as a whole.

- Interesting.

Okay, 2.7% of all emissions-- - Yep.

- Are from maritime.

- From maritime.

- Considering everything is moved here on ships, 90%, it doesn't sound too bad to me.

Yeah.

- It's not, and that... Yeah, that is one of the things that the maritime industry enjoys sharing.

- What's the target?

- There are three stages of targets.

2030, 2040, and 2050.

And the UN's maritime arm, the International Maritime Organization, IMO, has set by 2030, we need to be 30% less.

By 2040, we need to be 80% less.

And when we get to 2050, net zero emissions.

- Yeah.

[Margaret] Yes.

It's a bit of a pipe dream.

- It's very aggressive.

- And who's driving that?

I mean, where's that kinda-- - That is-- - That whole scheme coming out of?

- The UN.

- The UN.

Yes, the United Nations.

- The maritime arm of the United Nations is the International Maritime Organization.

It's based in London.

This has been one of the fastest moving efforts.

And the knock on a lot of this, it's moved so quickly, is, A, the number's not that terrible, and, B, is it an equitable energy transition for all member states?

- Yeah, I'm very surprised, actually, at that aggressive number.

- Yes.

- Especially on a-- - But again, it hasn't been formalized.

- Right.

- So we'll see.

- We'll see how it goes.

So let's talk about options then, if you're going away from diesel.

- Okay.

- What are some of the fuel options, lower CO2 fuel options as we look to the future?

- Some of them are LNG and methanol.

- Okay.

- There's growing talk of ammonia.

- Oh, interesting.

- There's hydrogen.

- Yeah.

- Yes.

- Why are we giggling?

- There's so many things about hydrogen that are just silly.

Just to store hydrogen is impossible.

- Yeah, yeah, yeah.

Element number one, it just-- - Yeah.

- There's also battery power.

- But that's just harbor [indistinct].

- Very interesting.

So batteries, hydrogen, we could come to-- - Ammonia.

- LNG, we've talked about.

- Yeah.

It's fossil-based.

It's natural gas-based.

- Sure.

- So is the majority of the natural gas that comes out from the whole fracking revolution.

The next step is making renewable natural gas from, basically, turkey litter.

You have a network of farms in the Midwest.

[Anna] The biomass.

- The biomass.

The other thing is landfill gas.

- Yeah, waste.

- Basically, waste gas.

- Yeah, yeah.

- So that's one, but it's very hard to aggregate that.

There's just not the volumes there.

- The scale is just-- - The scale's crazy.

- Okay.

Methanol.

Where's the methanol come from?

- Natural gas.

[Anna] Natural gas.

[Scott] You make it?

- Yes.

- Yeah, but there's other ways to make it.

- Okay.

- There's gasification technologies that make it.

There's people that say they can make it out of basically a hydrogen-based process.

The big thing for green methanol, or E-methanol, there's two ways to do it, right?

There's the green version, where you're totally using biomass.

There's no fossil fuels involved.

The scale up of that, because in order for a company to do this, they need offtake.

Like, they need Maersk to say, "I will take two years supply."

But they can't get there until they scale up.

So that's the problem with green methanol or any of the Es.

They're just not ready for market.

[Scott] Yep.

- Yeah, it's... There's not a silver bullet.

There's not a magic bullet here.

- No.

- There's a lot of okay options.

[Margaret] Yeah.

[Scott] Yeah.

- But there's not the one.

There's so many different technologies and ways to go.

Ship owners can't dec... Are tentative to decide on... To bank on one and put all their money-- - Right.

- On one based on the cost of a conversion, or a retrofit, or a new build if that's not gonna be the one that gets us there.

- The supply isn't there.

- Yeah, if the supply's not there.

If when they start to do this on a mass scale, they start to test it and the regulators say "No."

- Interesting.

- Or there's a safety issue and the regulators say, "You're not putting this on a ship."

- Is there concern that, like in other sectors, that we do this but the rest of the world isn't, and now we can't compete with-- Is this a concern in the industry?

- Absolutely, yes.

- Are we sort of going, "What the hell are we doing here?"

- And this is why the IMO, the UN's... International Maritime Organization from the UN is trying to get all of us on the same... Reading from the same page, on the same notes, at the same time, so there's nobody who's going off on their own and then overcharging or undercharging, or fining or levying, or is so far behind where everybody else is that they're now outta the play.

- Right, and how is that going?

Because I'd be shocked if you said-- - It is not a kumbaya moment.

No.

- Okay.

- There are countries who are pushing back within the framework of the UN and the IMO.

There are countries that are pulling out of it-- And just saying, "We are not doing this.

We'll do our own thing."

- Right.

- "But we're not doing that."

- Yeah.

- And then, there are some countries who are like, "I don't know what to do, but I'll sit here in the IMO and wait for them to tell me."

- Anna's right.

There are countries that are just saying, "We stepped away back in April and we're not gonna do anything."

And then there's countries that are saying, "I'm not abiding by both."

- Yeah.

- Because the penalties are $2,400 a ton, and that's a minimum for some of this stuff.

- Wow.

- I mean, it's... The smaller owner is gonna say, "I can't do this."

The other thing is the lifecycle analysis of these fuels.

What they... That's what the final IMO dagger's gonna be.

They insist on lifecycle analysis, which is what they call "Well to wake."

- Yeah.

- Basically, "Where'd you pull it out of?"

- Yeah.

- "And what does it look like "when it's coming outta the back end of the ship?"

- LCA is hard though.

- It's really hard.

It's hard to do, it's hard to monitor.

You have to certify your fuels along the whole supply chain.

- Right.

So options: Methanol, LNG, ammonia, hydrogen, which you have to make from something hard to capture.

Fuel cells are cool, but maybe... And then, we didn't mention nuclear.

- Oh, there's proponents.

- No emissions.

Small.

I mean, it's on military vessels.

Why aren't we still-- - It's not viable.

- Viable.

- It's so expensive.

- Yes.

- Relative to what?

Climate change?

- No, to the... No, I mean, if you were to see the size of a Wärtsilä engine, when you go to the Wärtsilä facility down in Florida-- - Yeah.

- They're the size of this building.

Your nuclear reactor you're gonna have to put on there, it's gonna have to meet that load.

- Yes.

- A number of my friends that work in the marine finance world have done a back of the napkin-- - Okay.

- You know, the cost of doing this.

- Right.

- And actually insuring it.

- Oh.

- 'Cause it's such a new technology.

It's not the technology of the fast attack from 1987 that was running around pinging Russia.

- Right.

- That's not this.

And they think... One of the best things they're thinking about doing is nuclear for what they call cold ironing.

So when you-- - For shore power.

- For shore power.

That's one of the, they think, starting points for this.

- Okay, so-- - Because it's a much different technology than-- - A small modular reactor of some kind for shore powering.

- Exactly.

Yeah, that's what they're talking about doing.

But no, and also, there's a law right now that no... At least in the U.S., no merchant marine, since the Savannah, can be nuclear, so that would have to change.

- One disaster.

- Yeah.

And they just didn't want more.

- One big disaster.

- It was an expensive big disaster.

- Yeah.

- And it just... It's so-- - But relative to climate?

- Yeah, but who's gonna pay for that?

That's the whole thing.

You have a ship owner, that-- - Who's gonna take the risk, you mean?

- He's gonna take the risk.

And if you talk to the guys-- - Who's gonna be serial number one?

- Correct.

- The marine finance people.

- Okay.

- These are very smart people that have done the numbers, and say, you know... Nuclear just needs to... It's not there to scale up to that economy size.

- Interesting.

Even though we have it on fairly large aircraft carriers for decades and decades.

- Yes.

- Because the military has a... The checkbook is much bigger.

- Interesting.

- And also, if a military ship powered by nuclear goes down, there's military ports that will take it.

- Yeah.

- Right.

- If a commercial ship with nuclear goes down-- - Who wants it?

- No port is gonna accept that ship.

It is just gonna-- - That's interesting.

But they would... Let's say something happened on a diesel ship, they would take it?

- Yes.

- Okay.

- Yeah.

- Usually, it's only if you're leaking something they really don't want you.

[Anna] Correct.

- On these newer fuels, are there equipment challenges or ship challenges to move them around?

- For the fuel and infrastructure?

There's getting the fueling setup in the ports, and in the ports where it's needed.

- Yeah.

- If your only ship goes from A to B, that's fine, but that's not how ships run.

They make five or six different port calls.

Some ships, called tramp ships, just go from port, and then they're told to go to a different port, and then they're told to... Wherever the job takes them, so they don't know where they're gonna be, they don't know where they can refuel.

But they have to make sure that where the ship comes in, they're gonna have the infrastructure in the port-- - Right.

- To fuel it.

They're going to have the availability of fuel to fuel it.

- Yes.

- The scalability for the fuel amounts you're gonna need, the training that you're gonna need, both on the shipboard side and on the shore side, to make sure everything is done safely when you're doing the fueling.

- Right.

- When we implemented LNG in Jacksonville, Florida, we were the ones that said, "We will train your first responders for free."

And that's not gonna happen everywhere.

- Right.

- But the important thing to keep in mind with this is really the infrastructure.

The infrastructure just has not kept up with the demand.

So unless you have the demand, you're not gonna have the liquefaction.

And again, unless you're actually taking a renewable natural gas from somewhere, it's still gonna be a fossil fuel.

- Yep.

- So do you take the chance and build the $200 million LNG facility?

That's not gonna be any good to anyone for the shipping industry in 2035.

- Right, interesting.

Yeah, that's a long runway that you've gotta bet on.

How about while the ships are in port, emissions... Are there emissions concerns there too, and what do we do with that?

- Absolutely.

Ballast water is a huge emission issue.

- Ballast water to keep it from tipping over?

- Correct.

So when a ship comes in, if she's light and has no cargo on her, she has ballast water on her just to keep her down and keep her stable.

- Okay.

- If she's going to be loading, she has to get rid of that water.

So discharging your ballast water into the port water-- - It's illegal.

- Is illegal, yes.

Basically everywhere now, it's illegal, but in the late '90s, they started to figure out that if I pick up ballast water over here in the Indian Ocean and then I drop it off in North America, there's all these invasive species-- - Sure.

- That have no natural predator, that are gonna take over everything, that are going to kill whatever's naturally living in that water, and become a nuisance unto themselves.

So to stop the invasive species, you can take it in, and then at a certain point, outside the port, you have to discharge it and come in completely light.

So that's the ballast water emissions.

- Okay.

- For air emissions, different ports have different rules.

Some allow zero, some allow five minutes at this percent opacity.

Like, you can blow your stacks for a little bit.

And "opacity" is how dark the cloud is that come outta your stack.

- So you're cleaning... What are you doing?

You're cleaning out your diesel stack?

- Or if you're just running your engines.

Like, you're here but you gotta keep the lights on and things, you still have to run that engine-- [Scott] So climate control.

- Correct.

To run the AC, and the lights, and the crane that's on board to get the cargo off.

You're still gonna have the stack running.

- Sorry to interrupt, but they each have a little electric generator on them, basically.

[Anna] Correct.

- But not enough for a hotel-- [Anna] But not enough to run-- - The whole hotel load while you're doing-- - Correct.

- Or cargo operations, the non-- - Emergency diesel generators for an emergency.

- Emergency.

- I gotcha.

So they plug into something on shore.

- Yeah.

- Well, that would be shore power or cold ironing.

- Okay.

- That is one option you can plug in.

- More like plugin.

- Yes.

Yes, massive plugin.

- I mean, we've had problems where the plugs don't fit.

- Yes.

- That [indistinct].

You came all the way here-- - And now the plugs don't actually fit.

Yes.

- Okay.

[Margaret] But that's a big issue.

- You can... I know on the smaller, like, a work boat thing, work boat size vessels, they will switch from fuel to battery power once they get in, and then they'll be zero inside the port.

So they're meeting all their emissions standards 'cause they're run on batteries inside the port, and once they go out, they'll flip it over and run on fuel.

- Batteries on the ship?

- Yes.

- Just for that local, little distance?

- Correct.

Just for that little, little local distance.

Correct.

- Gotcha.

Okay, so again, attempts to address that are working, they'll never be perfect.

- Yes.

- But we're heading in a good direction?

- Yes.

- Fair?

- Yes, yeah.

There's lots of paths we're looking at right now.

There's no magic bullet yet.

- Other challenges that we haven't talked about?

- The security of the vessel.

The safety and security of the vessel underway.

- Okay.

- Like we were talking about in the Red Sea and the Gulf.

- Okay.

- With Israel and Hamas, and with Houthis either attacking each other and ships getting caught in the crossfire, or drones into ships, that is an issue.

- Oh.

Right.

- We haven't talked about the safety of them.

We haven't talked about the wellbeing of the crew.

- Okay.

- Their care, their pay, their mental health, their isolation from families, their being away for long periods of time, six to eight months.

- So they're out for six, eight months.

[Anna] Right.

- Mental health, physical health.

- Yes.

- So onboard doctors?

- No.

- No.

- No?

- Second mate.

- The second mate is your medical person.

- Second mate is a kit.

- For some ships with good internet-- - Telehealth.

- They can telehealth.

- Okay.

Well-- - Yeah.

- Unless you're on a cruise ship, then you got a doctor.

But other than that, no.

- Yeah, interesting.

- Yeah.

- And the crew thing, is it unionized?

Are they paid well?

- No.

- Are they?

- In the U.S., but not-- - In the U.S., they're paid well.

But however, in other countries, relative to what they're making, still not a bad job.

- Yeah.

- You're making money and you're sending that home-- - Okay.

- Because that is a good job-- - Right.

- For those nations.

- But you could be on that cruise ship for a year.

- But you could be away from home for nine to 12 months, yeah.

- It's what they accept.

- Correct.

- You don't have that in the U.S.

Merchant Marine.

[Anna] No.

- Gotcha.

Both important issues for sure.

- Yeah.

- Yes.

- Safety and crew.

Anything else?

- The infrastructure, that's a hill I will die on.

If you don't have the infrastructure, we are all just talking in circles.

The U.S.

is inundated with landlord ports.

So they have-- - So that means private?

- They have rented out to private terminal companies.

- Okay.

- So they make those infrastructure decisions.

- Okay.

- And what's the cost benefit for the Maher Terminals, or some of these others, say, "Oh, I need to provide this, this, and this technology"?

It really doesn't hit their bottom line because they're just a private entity.

- Gotcha.

Well, let's kind of think to the future a little bit.

What do you see fuels, shipbuilding, some of the big things we've talked about, coming to us in the next couple of decades or so, Anna?

- It's gonna be decades.

The shipbuilding, and maritime as a whole, is very conservative.

We're last adopters.

We're very slow to action.

So everything that we addressed, we'll still be talking about in five years, in maybe 10 years.

It will still be topics of conversation.

- We'll have you back.

- Yeah, we'll be back.

- Okay, great.

I'll be here, yes.

They'll still be topics of conversation that we're working towards an answer on.

- Okay.

Not all bad.

Thoughtful, but maybe not at the pace-- - Yeah, not... - Right.

- Yeah.

Add to that, Margaret.

- Yeah, I would just layer it over the EU of 2026, where they're gonna start really looking at people's emissions.

And that is just a... There's the EU, and then there's a tax system within the EU called the ETS.

That's a lot of money.

If you're coming to EU from another place, 50% of your fuels need to have this sort of emissions profile.

It's very hard.

And then, you layer in 2028, according to the IMO right now, that's gonna kick in.

Like Anna said, decades.

This isn't decades, this is three years from now.

- If you got to ask Margaret a question, and if you got to ask Anna a question, fire away.

What would you ask her?

- Margaret, what makes infrastructure the hill you're gonna die on?

- It's not happening.

You need the big infrastructure for the economy of scale that's there.

And you also need the supply.

The supply isn't there.

So yeah, infrastructure's the key and public... Europe is moving forward because it's public investment.

Public investment needs to become a reality here, or some way to get the cost benefit of the private infrastructure, the funding there to have them to understand the importance of it.

Right now, their bottom line is their bottom line.

- Yeah, interesting.

- Yeah, I have a question for you.

- Okay.

- Go ahead.

- You're Everglades.

You're everything... You're all things Everglades, right?

- Yes.

- What would it take for someone to say, "I'm gonna put infrastructure in and around your port?"

- Whew, land.

- Yeah.

- We are completely locked out.

We have Fort Lauderdale to the north, Hollywood to the west, Dania to the south, and obviously the ocean to the east.

I don't have land.

- Yeah.

- I've got no footprint for you.

- Yeah.

And that-- - That is also a lot of... That's a lot of ports' problems.

Not just-- - Oh, New York.

- And the land's taken up by things other than-- [Anna] By, yes.

[Margaret] Condos.

- By condos.

Airports.

- Malls.

- Yes, parks.

State parks that are never gonna not be a state park.

Yes.

- Interesting.

- It's all... It's developed or it's a park, so it's never gonna be developed.

- And that's the important part, is that I think the people that represent the port authorities, there needs to be some onus on them, from a business case, that you don't wanna put yourself out of business, so in your 50-year master plan, where's the alternative fuel infrastructure?

- Right.

What gives you hope?

- The maritime industry is so vibrant.

It's such a vibrant community to work in.

No day is ever the same.

- Yeah.

- There's always something happening.

We have a spot for everybody there.

I don't care if you're an accountant, legal, a medical, a teacher, a culinary, a welder, HVAC, there's something for you to do in the maritime industry, and it's a good paying job.

I mean, if we're gonna be talking about this for decades, you're gonna be working for decades, so it's-- - Are young people coming into it?

- Oh yeah.

- There's a gap in what we need versus what we have, and we're hoping to fill that.

I don't know because this industry is also 24/7.

Ships run all day, all night.

- Yeah.

- We're certainly doing our best to get out to the schools and talk to fifth graders, eighth graders, 12th graders, college kids, have internships, have student groups through the port, have community groups through the port so the parents can start pushing it on their kids.

- Gotcha.

- Yeah.

- How about you Margaret?

What gives you hope?

- There's a lot of smart people that get that ship from point A to point B. That is without a doubt.

And there's a lot of people that are from... Just looking at data, "How do we make this work?"

So that gives me hope that there's people in their low... In their mid-30s, they're adjacent to the maritime industry, but they care about sustainability and actually reducing the carbon footprint of the industry.

- Yeah.

Well, those are both good, practical, hopeful thoughts too.

We got 110 million households that listen to this, and podcasts.

What would you hope that they would remember from what we've talked about?

- I think the takeaway is look around your house and where did all this come from, and what does it do to do that?

What does it take to actually get it there?

To quote my grandfather, who was a chief engineer, "Maggie, if people ever knew."

- That's a great quote.

- Yeah.

- Sadly, she stole mine, which was-- - Okay.

- It's everywhere.

It's in that cup of coffee you're holding while you're watching this program.

It's... Shipping touches every part of your life.

- Yeah, yeah.

And this is an energy and environment climate show, and we've talked a tremendous amount about the energy it takes to do all these things, and some of the impacts of that, and the good trends there as well.

So look, I've learned so much and been scribbling down.

Thank you for your expertise, and sharing it with us, and taking the time to do that.

- Thank you.

- Scott Tinker, "Energy Switch."

Anna, thank you very much.

- Thank you.

- Margaret, thanks so much.

- Thanks sir.

[Scott] Shipping produces less than three percent of global CO2 emissions.

A small amount for an industry that brings us 90% of everything.

Still, as of 2025, The UN's International Maritime Organization, or IMO, has aggressive targets to reduce that to net zero by 2050.

The industry sees too many challenges with nuclear, though it has successfully powered our Navy for decades.

So they're exploring alternative fuels, mostly LNG, methanol, and ammonia, ideally made from renewable natural gas.

Yet all these face challenges of meeting the enormous volumes required, and adopting them in ports and on ships across the industry.

So a growing number of countries and operators are pushing back, threatening to leave the IMO.

The industry faces other challenges, in infrastructure and crew, but it offers well-paying jobs to a diverse workforce.

Because it's essential to the world economy, shipping will surely weather these issues and steam on.

[upbeat music] ♪ ♪ ♪ ♪ ♪ ♪ [Narrator] Major funding provided by Arizona State University.

Home to the Thunderbird School of Global Management, redefining management education to empower transdisciplinary leaders.

Arizona State, The New American University.