A new Impact Partnership Agreement has been signed by the Global Centre for Maritime Decarbonisation (GCMD) and shipowner-controller insurance product provider Gard to advance decarbonisation of the global shipping industry.
Accounting for some 3% of the world’s carbon dioxide (CO2) emissions, shipping was responsible for the release of about 833m tonnes of CO2 in 2021. To aid in the reduction of these emissions, GCMD is developing pilots and trials which include an assurance framework for drop-in green fuels and an ammonia bunkering pilot expected to take place in late 2023.
The new five-year IPA will see Gard helping to assess risks associated with the testing of new low-carbon fuels and technologies, eventually leading to the scaling-up of these technologies. In addition to providing insurance coverage, Gard will also provide legal and risk advisory services and financial contributions towards GCMD’s pooled funds for pilots and trials.
As one of the world’s leading marine insurer’s, Gard has stated its intent to support the industry in the journey towards decarbonisation. Rolf Thore Roppestad, CEO of Gard, said, “We all have our role to play in this transition, and ours is to provide the support and risk mitigation needed to make it happen.”
“We want to support our members and clients as they test and implement new technologies and look forward to working together with the GCMD in this regard.”
The de-risking of end-to-end pilots such as those being undertaken by GCMD could play a key part in lowering barriers of adoption and enabling the deployment of green marine fuels.
In recent times Europe’s lawmakers have pushed for the reduction of greenhouse gas (GHG) emissions from shipping by 2% as of 2025, 20% as of 2035 and 80% as of 2050 compared to 2020 levels.
The measures were suggested as part of the EU’s FuelEU Maritime proposal, which aims to achieve ‘significant’ reductions in CO2 emissions of international maritime transport and increase the production and the uptake of sustainable alternative fuels for the sector.
By providing ‘greater clarity’ to the maritime industry on the use of such fuels and emerging decarbonisation technologies, Lynn Loo, CEO of the GCMD hopes to showcase how nascent technologies can be de-risked commercially.
“As the uptake of low/zero carbon fuels begin to take off, insurers are faced with the need to reinvent operating models and offer new products to clients,” she said. “The GCMD-Gard partnership aims to have the legal and operational risks of GCMD’s pilots and trials assessed and insured.”