The report features an updated carbon risk management framework, including a new ‘decarbonization stairway’ model to help owners map a path to sustainability.

Choosing the right fuel today for operations tomorrow is a daunting task that all owners must face up to. The business environment is changing in line with the natural one, leading not just to increased regulatory requirements, but also to new cargo-owner and consumer expectations and more rigorous demands from capital investors and institutions.

…. said Ørbeck-Nilssen.

The maritime industry will go through a period of rapid energy and technology transition that will have a more significant impact on costs, asset values, and earning capacity than many earlier transitions.

Shipowners are already experiencing increasing pressure to reduce the greenhouse gas footprint of maritime transport. This report provides an updated outlook on the regulatory and commercial drivers for decarbonization of shipping:

• Three fundamental key drivers will push decarbonization in shipping in the coming decade: regulations and policies, access to investors and capital, and cargoowner and consumer expectations.
• The Initial IMO GHG Strategy currently drives policy development within international shipping, and the first wave of regulations will take effect from 1 January 2023 (i.e. EEXI, CII). We expect them to have a significant impact on design and operations of all ships.
• While all ships need to fulfil the minimum compliance requirements from the IMO, commercial pressure may push shipowners to aim for a leading position in decarbonization, as we expect that poorly performing shipping companies will be less attractive on the charter market, and may also struggle to gain access to capital.

Further, this report provides an outlook on ship technologies and fuels that could help shipping respond to the decarbonization drive, introducing an updated timeline for the technical availability of selected alternative fuel technologies. In fact, it is highlighted that:

• The energy and technology transition in shipping has started, with nearly an eighth (12%) of current newbuilds ordered with alternative fuel systems. This is an increase from the 6% reported in the 2019 edition of DNV’s Maritime Forecast to 2050. Except for the electrification underway in the ferry segment, the alternative fuels are currently still mainly fossil-based, and are dominated by LNG.
• There will be demonstration projects for onboard use of hydrogen and ammonia by 2025, paving the way for zero-carbon ships, and these technologies will be ready for commercial use in four to eight years. Methanol technologies are more mature and have already seen first commercial use. Fuel cells are far less mature than internal combustion engines, for all fuels.
• Safety is a prerequisite for the successful and timely introduction of the new fuels such as hydrogen and ammonia. Development of efficient safety regulations and guidelines is fundamental to evolve from largescale demonstration to commercial use.
• A range of new technologies are emerging, including fuel cells, CCS, and wind power.

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