Ro-ro operator UECC says it is raising its sustainability game by expanding the use of carbon-neutral biofuels in its logistics chain through a new partnership for decarbonisation with Svitzer, a global towage provider and wholly owned subsidiary of AP Moller-Maersk.
The two companies have signed a three-year contract for Svitzer’s EcoTow product that will see biofuels introduced on Svitzer tugboats performing towage operations for UECC’s pure car and truck carriers (PCTCs) calling at Scandinavian ports. This will result in a reduction of almost 25% in UECC’s seaborne Scope 3 emissions – covering indirect emissions associated with business operations across the value chain – to augment direct emission cuts from its progressive adoption of alternative low-carbon fuels on existing vessels and newbuilds.
It is estimated that CO2 emissions from UECC’s towage operations at the ports of Esbjerg, Gothenburg and Malmo will be reduced by more than 300,000 kg over the term of the agreement with Svitzer.
Biofuels are considered among the most effective fuels for decarbonisation in the short term as these are readily available and can deliver easy, immediate cuts of as much as 100% in tank-to-wake emissions for existing vessels. European shortsea shipper UECC has been using biofuels on its PCTC Autosky over the past two years to cut annual carbon intensity by around 60%, thereby promoting development of a wider bunkering network for this type of fuel that will be further supported by the pact with Svitzer.
UECC’s energy and sustainability manager Daniel Gent said: “With this agreement, UECC once again positions itself in front of the market, demonstrating that decarbonisation projects are scalable and available. This project aligns with our own supplier policy, which looks to holistically reduce the environmental impact of our business operation, far beyond regulatory requirements. UECC is demonstrating our willingness to ‘walk the talk’ and we once again call on our customers to join us as decarbonisation partners.”
UECC’s sustainability goals for its vessel operations are closely aligned with those of Svitzer. The towage operator recently announced its ambitions to reduce CO2 emissions from its fleet by 50% within 2030 and achieve fully carbon-neutral towage operations in 2040, initially through conversion to biofuels.
Sven Lumber, head of EcoTow at Svitzer, said: “We are extremely pleased to see UECC among the first-movers on EcoTow in Scandinavia. With this agreement they join other global Svitzer customers who partner with us around decarbonisation, gaining the ability to include externally audited CO2 emission savings in their reporting. This shows a strong desire on the part of UECC to demonstrate environmental responsibility.”
Gent underlines there is an increasing commercial incentive to reduce the carbon footprint of ship operations due to upcoming regulatory measures that are set to spur biofuels demand. These include the proposed expansion of the EU’s Emissions Trading System (ETS) to include shipping within the next two years that could raise the cost of consuming fossil fuels by around 50%, based on a current carbon price of around €80/t of CO2. Furthermore, shipowners will have to meet more stringent environmental performance standards with implementation of the IMO’s Carbon Intensity Indicator from 1 January 2023 and the FuelEU Maritime regulation due to be phased in from 2025.
UECC expects to be among the first shipping companies to exceed the IMO’s 40% carbon intensity reduction target by 2030 through investments in a trio of newbuild multi-fuel LNG battery hybrid PCTCs, as well as the use of alternative fuels such as biodiesel and biogas on existing vessels. The second of these newbuilds, Auto Achieve, was recently delivered from China’s Jiangnan Shipyard and will start trading this month, with the third vessel due for delivery in autumn 2022.