ALTHOUGH we are an island nation, it may not be commonly known that the maritime sector contributes £46.1 billion to the UK economy, worth more than the air and rail sector combined.
It is an industry that is crucial to our resilience, with 95% of UK imports and exports moved by sea. It’s also responsible for three per cent of UK greenhouse gas emissions according to the Committee on Climate Change. Decarbonising this sector will be an essential part of meeting our net zero targets as well as creating good green jobs and economic opportunities to echo the “build back better” mantra.
Although maritime is widely regarded as a “hard to abate” sector in terms of the challenges and barriers to fuelling long distance shipping, the cost of a green transition and the fragmentation of the industry worldwide, it’s not all doom and gloom when it comes to carbon reduction opportunities.
According to the World Economic Forum, the decarbonisation of shipping could be “the catalyst for the broader energy transition, unlocking the market for zero emission fuels” representing a “trillion-dollar market opportunity.” In addition, a recent report from Policy @Manchester, On Net Zero, suggests that “far from being difficult to decarbonise, the shipping sector has significant room to manoeuvre” in terms of emission mitigation, with ready to use low carbon techniques such as ammonia fuels, sails and slow steaming.
The problem in Britain seems to be the lack of financial incentives. Maritime UK, the industry’s collective mouthpiece, estimates that this sector will require some £1bn of co-investment in order to “steer[ing] our ships in a green direction”. So far, the UK Government has put forward £20m, a drop in the ocean in the big scheme of things.
It doesn’t have to be like this. Nordic countries are ahead of the game in recognising this sector’s potential and providing the capital for innovation to decarbonise. Sweden, for instance, leads the way through a collective commitment across the maritime industry and government, vital industry partnerships and cluster initiatives where bold public investment, dynamic leadership and vision pushes innovation, celebrates high risk ventures and strives for first mover advantage in the race to net zero.
Energy leaders in Norway are also tackling hard-to-abate sectors face on. Building on their expertise in energy, related infrastructure and supply chains, combined with effective governance, funding and incentives for this vital transition, Norway is now looking to innovate in hydrogen technology to tackle heavy duty transport, with their launch this past summer of the world’s first car ferry powered by liquid hydrogen.
With all this in mind, rather than hard to abate, it seems the maritime sector in the UK is in limbo, waiting for the Government to step into this breach with some bold public finance collaboration packages to realise existing opportunities in new technologies as well as future decarbonisation possibilities.
This lack of a holistic, bold and brave vision has consequences across the economy, our employment sector and any first mover advantage.
Less Global Britain, more last to the international challenge. Again.
Douglas Chapman is the SNP MP for Dunfermline and West Fife