Cargill, one of the world’s leading international transporters, producers and marketers of food, agricultural, financial and industrial products, Huntsman Corporation, the global manufacturer and marketer of differentiated chemicals and UNIPEC UK Company Ltd, trader of crude oil and oil products, have announced they will only charter the more efficient vessels operating in the shipping market.
This commitment is the first of its kind in the industry to reduce the existing fleet carbon emissions. The announcement, from the three charterers, who together charter over 350 million tonnes of commodities annually, signifies a milestone for the vessel fuel efficiency ratings system, the Existing Vessel Design Index (EVDI), created by ship vetting specialist RightShip and published on ShippingEfficiency.org – an initiative launched by the Carbon War Room and RightShip to increase information flows around international shipping’s energy efficiency, as an GHG Emissions Rating (A-G rating) benchmarking system.
The efficiency ratings system – containing efficiency information on over 60,000 vessels including container ships, tankers, bulk carriers, cargo ships – enables charterers to instantly see a ship’s theoretical greenhouse gas emissions and relative energy efficiency as determined by RightShip’s EVDI rated from A (most efficient) to G (least efficient), compared to ships of similar size and type.
“Cargill has introduced a senior management override on the use of the least energy efficiency vessels. By choosing the more efficient vessel available to us, we are making a strong statement to the market,” said Jonathan Stoneley, Environment and Compliance Manager, Cargill Ocean Transportation.
He added: “We hope this action will demonstrate to ship owners that they can and should do more in terms of efficiency, and that the market will reward them and will also show other charterers the decision support tools available if they want to operate more efficiently. We will work together with customers, as best appropriate, to help them meet their environmental objectives linked to transportation and this rating system.”
Stoneley continued: “Cargill is committed to minimising our environmental impact throughout our global operations. We do this by developing management systems and policies to ensure best practice environmental compliance and continually improving performance on criteria relevant to our business and operations. We partner with governments, non-governmental organisations, communities, employees and customers to leverage market-based solutions to reduce the environmental footprints of the supply chains in which we participate.”
Peter Boyd, COO of Carbon War Room, added: “This deal represents the first major capital shift on behalf of the charterers towards making greater efficiency a factor in their vessel chartering decisions. Cargill, Huntsman Corporation and UNIPEC UK should be congratulated for being the first to make this commitment. We’d encourage other charterers within the market, to look towards the simple and understandable ways to quantify, measure and track efficiency represented by the efficiency rating system and the A-G benchmark. Those that lead the curve on presenting more eco-efficient vessels will benefit from the choices charterers are making and the charterers themselves will see lowered operating costs through fuel efficiency – a win-win-win decision for the owner, the charterer and the environment.”
Warwick Norman, Chief Executive Officer, RightShip, stressed: “Cargill, Huntsman Corporation and UNIPEC UK have strong commitments to maximise efficiency on environmental grounds, and we are proud to provide them with the decision support tool they need to implement their environmental leadership position. With the common decision making framework first movers will have significant market advantage over competitors who are using traditional methods to evaluate efficiency.
“Without this level of information it’s very difficult for charterers to make informed decisions on vessels based on their efficiency – for example, newer ships aren’t always more efficient than older ships. We’ve developed the Existing Vessel Design Index, or EVDI™, to estimate the amount of CO₂emitted per tonne by any nominated ship, per nautical mile travelled, based on complex analysis of a range of reliable data. With our partners at www.shippingefficiency.org, we’ve used that data to also create the A-G GHG Emissions Rating that makes it easy to compare energy efficiency. The online rating system directly compares the efficiency of a vessel against vessels of comparable size and within the same ship type. This practical, usable information can enable our customers to make fuel savings and meet energy efficiency targets, and their preference for more efficient ships also rewards owners who have invested in operating a sustainable fleet.“