By CityAM
The shipping industry must spend at least $1 trillion on new fuel technology if it is to meet UN emissions targets by 2050.
According to a new study by experts from UCL and the Energy Transitions Commission, the minimum average that would need to be spent every year from 2030 is $50bn.
Global shipping is responsible for about 2.2 percent of the world’s carbon dioxide emissions. The International Maritime Organisation has set itself the target of reducing emissions by 50 percent by 2050.
If the sector was to fully decarbonise by 2050, an additional $400bn of investment would be needed over the 20-year period.
Roughly 87 percent of the investment would be in land-based infrastructure and production facilities for low-carbon fuels.
The remainder would be used for upgrades to the ships themselves.
Tristan Smith, reader at UCL’s Energy Institute, said: “Our analysis suggests we will see a disruptive and rapid change to align to a new zero carbon system, with fossil fuel aligned assets becoming obsolete or needing significant modification.”
In December the sector submitted a proposal to form a $5bn research and development fund for decarbonising the industry.
The fund, which will operate over a ten-year period, is designed to accelerate the development of commercially viable net zero ships by the early 2030s.
The International Maritime Research and Development Board (IMRB), as the fund will be known, will be financed by the payment of a mandatory $2 for every tonne of fuel a shipping company buys.
The study comes as the global shipping sector gears up for rising costs and new rules on the maximum amount of sulphur that will be allowed in their fuel.
The legislation from the IMO, which comes in to force on 1 March, is an attempt to reduce sulphur emissions by 80 percent.