Parallel Session A6: How can ports catalyze clean energy investments?

Experts convene to discuss maritime industry’s path to decarbonisation

In a comprehensive panel discussion focused on the decarbonisation of the maritime industry, experts from various sectors convened to explore the challenges and opportunities presented by the need to reduce emissions from maritime transport. Dominik Englert from the World Bank highlighted the significant contribution of shipping to global emissions, including sulphur and nitrogen oxides, and warned of an expected rise in these emissions without policy intervention.

The International Maritime Organization’s (IMO) commitment to decarbonising international shipping by 2050 was acknowledged, with policies focusing on energy efficiency and the development of zero-carbon fuels, such as green hydrogen and its derivatives like green ammonia and green methanol. Dominik Englert emphasised the World Bank’s analysis, which suggests that shipping is likely to decarbonise through green hydrogen, offering higher energy density crucial for space-constrained ships.

The discussion also revolved around the potential for developing countries with renewable resources like solar and wind to produce hydrogen-based fuels competitively. This shift could transform ports such as Puerto Brisa in Colombia into hydrogen gateways, supplying green shipping fuels for wider global distribution. The panel touched upon the importance of connecting low-cost production centres for green hydrogen with high-demand consumption centres, emphasising the vital role of ships and ports in developing the global hydrogen economy.

The role of port authorities was a focal point, with panellists discussing their central role in facilitating the transition to green energy. This includes infrastructure upgrades, attracting private investment, and leveraging public subsidies. Namrata Nadkarni highlighted the importance of transparent communication and collaboration among stakeholders to avoid duplicating efforts and to share successes and failures for collective learning.

The future geography of bunkering was another topic of interest, with the possibility of new locations emerging as key hubs for green fuels. The panel speculated on whether ports like Seattle would adapt to new fuels and possibly collaborate regionally for fuel distribution. Katharine Palmer of the UN High-Level Climate Champion team shared insights on the progress made in maritime discussions over the past five years and the alignment of industry and nations to increase ambition in decarbonisation.

The panel concluded that the decarbonisation of shipping is a complex challenge with significant opportunities, especially for developing countries with renewable energy resources. Collaboration, communication, and strategic policy measures are essential for a successful transition. Ports play a central role in this transformation, and their authorities can act as facilitators and connectors for various stakeholders. The future of bunkering may involve a more diverse and decentralised network, with new players emerging as key hubs for green fuels. The panel called for all hands on deck to work together towards a sustainable maritime future, with a focus on strategic policy measures and responsible investment and consumption.

Noteworthy observations from the discussion included the emphasis on the need for a multi-fuel future rather than a single fuel solution, considering the diverse requirements of different types of vessels and shipping routes. The panel also recognised the importance of learning from both positive and negative experiences, with a call for greater openness in sharing lessons learned to accelerate progress. Additionally, the role of gender diversity and inclusion in the sector was highlighted, with an invitation for both women and men to join efforts in driving the industry forward.

Dominik Englert:
If shipping was a country it would be the sixth largest emitter worldwide. Furthermore, 12 to 13 percent of global sulfur and nitrogen oxides is caused by shipping emissions. And the worst is, maritime transport experiences continuous growth. And without any stringent policy intervention, these emissions are expected to rise further. So what to do to reverse this trend? In July 2023, about a year ago, the International Maritime Organization, the IMO, committed to decarbonize international shipping by or around 2050. The IMO policies currently under discussion seek to pull two levers. Maximum energy efficiency and a new generation of fuels, the so-called zero-carbon fuels. Based on our analysis at the World Bank, shipping is most likely going to decarbonize thanks to hydrogen, specifically green hydrogen. This includes green hydrogen derivatives, such as green ammonia or green synthetic fuels like green methanol. These offer a higher energy density than pure hydrogen. This means more energy per unit of space. And as you can imagine, space matters on ships. Eventually, we want to store cargo, not fuel. Let’s now move to the second level, the national level, where most of the action needs to take place. And let’s ask ourselves, what does this mean for ships and ports in developing countries? With conventional shipping, it was pretty simple. Countries required significant oil reserves to produce shipping fuels like heavy fuel oil. With zero-carbon shipping, they will need large renewable energy resources like solar or wind to produce hydrogen and its derivatives. Compared to oil, many more countries around the world, including many developing countries, have these renewable energy resources. So they have a tremendous potential to produce hydrogen-based fuels at low cost, enter competitively a much more inclusive and decentralized fuel market, and become the zero-carbon energy hubs of the future. Let’s look at Colombia and Panama, for example. In Colombia, my team at the World Bank focuses on ports along the Caribbean coast, actually not that far away from here. This region, La Guajira in particular, offers some of the world’s best renewable energy resources. Some of the target ports, like Puerto Brisa, are currently coal-exporting ports with declining business. We think that these can be converted and upgraded into hydrogen gateways, which can then supply the more energy-constrained Panama Canal, for instance, with green shipping fuels for wider global distribution. Demand for hydrogen-based fuels will not only come from shipping alone, but also from other sectors that need to reduce their greenhouse gas emissions, too. This relates, for instance, to chemicals, fertilizers, heavy industries, aviation, and potentially trucking as well. And depending on the sector’s needs, hydrogen can be used here either as a raw material, as a reduction agent, or simply as a fuel. In South Africa, the World Bank seeks to leverage the country’s strategic geographic position at the Cape of Good Hope. We have identified already two promising investment cases on the western coast. One of them is the port of Saldanha Bay, and that port offers a double business opportunity in green hydrogen, producing green shipping fuels, and at the same time, supplying green hydrogen to a nearby mothballed iron and steel plant. ArcelorMittal, who is the owner of that mothballed iron and steel plant, has already indicated at what hydrogen price they would be willing to resume operations and bring back jobs to South Africa. In Morocco, the situation is as follows. While the country’s south offers the best renewable energy potential, it is the north, with its industrial complex of Jof La Sfa, centered around fertilizer production, and the leading container port Tangimet, which offer the best opportunities for hydrogen consumption and distribution. The challenge now is in Morocco, how to ensure cost-effective transport of the hydrogen molecules from the south to the north. And this transport challenge exists all around the world. How do we connect the world’s future low-cost production centers for green hydrogen in Latin America in Africa, the Gulf region or Oceania with the world’s high-priced consumption centers of green hydrogen which are expected to emerge in Europe and East Asia. Here pipelines are unrealistic in most cases. Thus ships and ports which are able to handle hydrogen-based fuels will be vital for the development of the global hydrogen economy by linking supply and demand. Major shifts in global energy trade can be expected. Today hydrogen-based fuels account for only 1% of global energy trading. Here it is mostly methanol. Yet in 2050 these same fuels alone will represent more than one-fifth of global energy trade. So prepare for quite some changes. Eventually we have arrived at the lowest level at the local level now and are wondering what does this all mean for us here at the forum in this room. This map here gives you an overview of the World Bank’s existing and planned country engagements in terms of shipping, ports and hydrogen. Many more country engagements are in the pipeline. Sometimes at the World Bank it is the transport department leading them. Sometimes it’s the energy department which initiates the engagement and sometimes it’s our private sector arm the International Finance Corporation. When we think about shipping and ports in the transport department we think about a multi sectoral agenda. We always think of three main business cases. The first one is obvious here at the Forum. It is about supplying clean fuels for ships. The second one is supplying clean fuels to the local industry. I said iron and steel. I said fertilizer production. And the third one is producing, supplying green fuels for export to Europe, to East Asia. And to seize these business and development cases, in these three cases, we obviously need several players to get involved. We need the energy sector to produce the renewable power and ultimately the hydrogen-based fuels. We need the water sector to provide us with the supply of large amounts of desalinated water, as many of these regions that I have mentioned suffer from water constraints. We need the industrial sector to indicate its specific hydrogen needs and to make good use of the hydrogen fuels to decarbonize their own operations. We need the finance sector, both public and private, to mobilize the large-scale investments for wind parks, solar farms and electrolyzers at gigawatt scale. And ultimately, or maybe most importantly, we need the port sector to bring all these sectors and players together in one central location to enable mutually beneficial trade of this new energy commodity along new, clean, global supply chains. For instance, there is a crucial role for port construction, upgrades or retrofits in many of the countries that I’ve just mentioned. In South Africa’s Bukabay project, The Japanese investor Itocho clearly stated that they would only be willing to make the plant hydrogen and ammonia investments once they can be sure that there will be a port capable of importing large-scale wind power equipment, the blades, the pillars, all the other equipment that you need, and exporting at the same time the green hydrogen-based fuels. So let me quickly summarize once again what we have just sailed across within ten minutes. First, we have learned that shipping will likely decarbonize thanks to a new generation of fuels, mostly fuels made of green hydrogen. Second, that ships and ports in developing countries will be crucial in advancing the global hydrogen economy worldwide. And third, that ports, specifically port authorities or other port stakeholders, have a unique opportunity to lead or at least co-lead this multisectoral hydrogen development agenda. To make all of this happen, my suggestion to you here in the room is we need all hands on deck. So let’s bring everybody here at the forum together, the ports, the energy people, the industry people, the finance colleagues, the water colleagues, and let’s sort our ship out together. Thank you for your attention.

Gordon Wilmsmeier:
You’re not allowed to talk anymore. Okay, I’m going to take over the moderation now. All right, it works. Oh, Dominik, thank you. Excellent. So, Katharine, you… You as a maritime lead at the UN High-Level Climate Champion, now Dominik talks all the ship that happens, right? But actually there has been progress, but there’s still missing progress. So what’s your take on where the sector stand five years ago, where are we now, what has already happened, and what are the next steps?

Katharine Palmer:
Great, thank you very much for that question. I think there has been significant progress and a lot of people have already mentioned that over the course of this forum, that the conversations we’re having now compared to the conversations we had five years ago are very different. One of the things I would say when you say, what am I really proud of? One of those is that back in 2021, just prior to COP26, the High-Level Climate Champions for COP25 and COP26 launched a campaign called 2030 Breakthroughs, and that actually looked at the system transformation that was needed for the hard-to-abate sectors, including shipping, and tried to quantify what was needed by 2030 in order to be able to achieve net zero by 2050. And for the shipping sector, in partnership with the Global Maritime Forum and University College London, we identified that we needed 5% uptake of zero-emission fuels by 2030 in order to put shipping on course to achieve net zero by 2050. And why is that important, and why is this successful, is because how the industry got behind that number, how there was so much convergence across voluntary initiatives within the ecosystem, but not only from the industry side and the NGO side, we then had high-ambition member states get behind that goal as well, and the fact that that was then adopted in the greenhouse gas strategy last year is something that I think we should all be really proud of, how in a very short period of time, all actors within the ecosystem really converged behind one goal, and then not only did that stay at 5%, that ambition was upped again by the member states, really putting in that striving for 10%. And that’s a real example of how we work in the climate champions, of really driving that ambition loop between non-state actors and state actors. So I think that’s something we should all be really, really proud of. So then when we say what is missing and what is next, what is really critical now, the stage we are at in the negotiations, is that we really do need to ensure that the adoption of the mid-term measures incentivises the uptake of the long-run solutions of green hydrogen and its derivatives. So as Dominik put forward in his presentation, that is really how the shipping industry will decarbonise, through the use of green hydrogen and its derivatives, and if we don’t incentivise that in these mid-term measures when they are adopted next year, then green hydrogen projects are not going to be bankable or investable, so when we need to use the green hydrogen, it’s not going to be available. So that’s where I think the real focus needs to be in the short term.

Gordon Wilmsmeier:
I think that’s really interesting because you are actually, with your laugh, of black painting what is happening, and you are actually focusing… on the positive story behind it, and there is pressure coming up, and we know also that development takes time, and that actually, Sam, takes me to you, because the pressure will also grow on you as a port, and you as a port commissioner for the Port of Seattle, you will definitely feel that pressure. So what are your goals and strategies in order to prepare for that, that actually we can make these ambitions come true from the port perspective, what Katharine just talked about?

Sam Cho:
Yeah, hopefully not all the pressure is on us, maybe we can transfer that to some of our partners. But, you know, as a port, I think we have three main functions when it comes to this transition and catalyzing the investment in energy. One is obviously we are an aggregator of demand, we’re a very natural convener of everyone that touches the entire supply chain ecosystem, from truckers to gate operators, whether it’s key cranes, heavy-duty trucks, or the carriers themselves, there’s really only one entity that touches every aspect of the supply chain, and that is the port. And that’s a huge part of the reason why ports have this tremendous pressure to be part of the solution. In addition, I think from an infrastructure standpoint, we are also expected to be the storer, bunkerer, and also distributor of this new energy. Whether or not the hydrogen is being produced locally, I think there is an expectation that ports will be the natural place for these alternative fuels to be distributed globally, whether it’s imports or exports. And then lastly, and this really gets at the core of this conversation, is around funding and financing. From the U.S. perspective, we have a historic investment in U.S. infrastructure, the Infrastructure Investment and Jobs Act, the Inflation Reduction Act. This is over trillions of dollars in investment in our infrastructure that only public entities like a port can apply for, right? And so we need to partner with our private sector stakeholders to go after that funding to then subsidize the cost of building out cold ironing, onshore power, or bunkering of hydrogen, et cetera. And so I think that’s really crucial for that partnership to exist between ports and those private sector stakeholders who need that public subsidy and grants in order to make this economically feasible for the industry overall.

Gordon Wilmsmeier:
I think you’re done talking. Talk anymore? Oh, no, no, no, I’m back. No, I mean, I think that’s so important about the hardware that you’re talking about, right? Really creating that hardware that this transition can change. I mean, that brings me a little bit to you, Namrata, because you work in communication. It’s about storytelling, and we just heard two positive stories. But storytelling is also about really changing the culture, how we do things. So what do you think, from your perspective, what can the communication bring into this? How can we bring these stories that are actually real transitions, how can we convert that into powerful messages to transition the sector?

Namrata Nadkarni:
I think it’s a great question, and I think I want to flip it slightly, because a lot of people think you do the thing, and then you tell the story, right? Like, we have accomplished this, here is the press release, here is a bit of information. But actually, we throw a lot of terms around the room. We talk about accountability, we talk about transparency, we talk about reporting, we talk about stakeholder engagement, we’re talking about all of these things, and all of these things are communication. It is us being transparent and engaging with people to get that buy-in, to get these hearts and minds won. So, you know, we’re talking about things like achieving, like getting buy-in from your stakeholders, making sure that you’re doing the right thing. sure that water companies as well as bunker suppliers are in the room so that we’re not just talking to each other. We do need to get everybody on board, and I think somebody, I think it was Antonio on one of the previous panels, and he said, you know, if we tell the right stories and you get buy-in from multiple stakeholders, even if there’s a change in government, you can hold them accountable to the fact that they bought into that idea, and so the concept itself then goes above the players and it sits as a touchpoint for everybody to be part of the conversation. And I think when we’re talking about stories that we want to tell, obviously there’s a commercial incentive to say things like, oh, this is very difficult, it’s a very expensive transition, but also at the same time, we’re an industry that has agreed to meet certain targets. We’re talking, we’ve got Poseidon principles, we’ve got SDGs that we’re trying to achieve, we’ve got Paris Climate Accords, we’ve got IMO, GHG regulations, we’ve got multiple touchpoints that we have to meet, and we want to tell people how we’re going to meet these because if we don’t have that, we’re not going to have buy-in, but also, we’re going to replicate each other’s work. We’re going to waste resources, we’re going to say, here is the data system that we’re doing here, and somebody else two doors down, like one of the other banks, will have something similar. We don’t need that. We need to work together. We keep talking about collaboration. How can you collaborate if you don’t know what somebody else is doing? So I think the answer is, to be very honest and transparent, this does mean taking it in the neck a little bit if you have a failure, but failure is a part of the system. Progress is iterative. So if we want to tell the good stories, we have to just be open, and when we achieve something, we share it. When we make a mistake, we don’t say, oh no, we made a mistake, we’ll never do it again. We say, we made a mistake. Let us tell you so that you don’t waste the resources, and this is still a positive story.

Gordon Wilmsmeier:
All right. I think you’re making two positive points here. Or important. Two positive. No, no, no. Important, not positive. I think the real issue is, okay, we should walk the talk, and I think within walking the talk, there will be these positive and negative examples. Now, Katharine, you will hear a lot about what’s happening, it’s leadership with examples. So maybe you can share some examples, a very positive example, but maybe you can also think of an example where something failed and the lessons learned from that failure really then pushed the boundaries for the next step.

Katharine Palmer:
So let’s, okay, let’s start by leading by example. In the context of this session about ports, I think, you know, we saw the nice map that Dominik presented where the World Bank is engaging. They’re leading examples already, you know, but if we, and I think, you know, it’s what’s really interesting about those that are leading by example is that ports are at the center of these positive examples. And I think because of how Sam’s explained the role of the ports and the fact that they’re a facilitator and a connector and a labeler of all these different actors within the landscape, you’re able, the ports are able to lead by example. So, you know, we’ve heard examples from the port of Namibia and the relationship that they have with the port of Antwerp. So we’ve got this hydrogen ammonia export terminal being built by the port of Antwerp in the port of Walvis Bay in Namibia over the next three to five years. And that’s a really good example of how, you know, it’s gonna be state-owned, but it’s gonna be privately operated. And this gives an example of how the complexities of the port dynamics with different actors within one single port. Another good example is the port of Assu in Brazil. You know, they’ve got a platform to really accelerate hydrogen from their renewable energy perspective and again, they’ve got a big industrial market there. So I think port of Assu is another real good example. And then we can look at some leading examples like from a government like Panama and their national hydrogen strategy that has really set out ambitious goals, but also put in that, that, you know, 5% of that has to go into, will be, green hydrogen will be bunkered in Panama. by 2030. So they have bunkering goals in their hydrogen strategy as well as the production of hydrogen. So some really solid examples that are happening around the world. And I think your question on what maybe hasn’t been successful, I would tend to maybe draw a little bit on what Namrata was saying, that these don’t tend to be communicated. And I think this is something that we can really learn as an industry. And I kind of draw parallels. From a safety perspective, we’re very good at lessons learned and root causes when something goes wrong. And we share that and we all learn from it. But if I look at parallels within the environmental space, that’s not happening. And one of the things that really springs to my mind is green corridors. We’ve had a proliferation of green corridors. We’ve now over about 45 consortiums for green corridors since the concept was launched at COP26, which is absolutely brilliant. And you look at the momentum that everyone’s got behind this concept. But what’s working well and what isn’t working well? And how can those corridors that have been around for three years share what has worked well and what hasn’t worked well? So the emerging corridors today can learn from that. That’s something that I think we don’t have it. And it was something that I raised a month or so ago at another forum I was speaking at and saying, well, why don’t we share the lessons learned? Because, you know, like I said, we’re so good at it in the safety perspective, but it’s not something we do in the environmental space. So going forward, that’s something I’d really, really like to see is, you know, the green corridor consortiums come together and say, here’s our lessons learned, you know, three years in.

Namrata Nadkarni:
I could I just to that really quickly, sorry. I think there is a reason why people don’t talk about it and it’s this notion of wasting resources, right? It’s wasting money, wasting time, making a mistake. There’s this terror, to be honest, because everybody wants a success story. We’re like living Instagram where you only show your best life instead of actually, you know, the bits where you’re cooking and scrubbing floors. But we have to cook and scrub floors to look the way we do. We have to make mistakes to get it right. And I think you raised a point, Sam, didn’t you? About like 40 million that was spent and you learned a lesson. But it was so useful.

Sam Cho:
Absolutely. When I first joined the point in 2020, our budget for cold ironing onshore power at one of our terminals was 14 million dollars. I just approved the budget for this same terminal for 38 million dollars. That’s how much the price inflation has gotten. That’s how much lessons learned, I would argue, there were. And the point I made earlier is that, yes, in business, in corporate world, there’s something called the first mover advantage. There is an advantage to being the first. However, there’s also something called the second mover advantage. And that is that you’ve learned all the lessons from the first mover that you don’t repeat when you do it later. So why did we go from 14 million dollars to 38 million dollars? What were the lessons learned? And how can we then transmit that intel to our colleagues across the world so that we don’t repeat those mistakes again? And I agree with you. As a government entity, we are not rewarded for taking risks. In fact, we are the most risk adverse, you know, entity there is. And for that reason, we do not, we’re not in the business of flaunting our mistakes for fear that we would not be able to do it again in any other project or any other way. So it’s a very good point,Katharine. I think whether it’s the green corridor or even in how we install the infrastructure on a terminal level, that know-how and those lessons do need to be distributed throughout the industry. And I think here we’re getting

Gordon Wilmsmeier:
to this very important point about it’s, we talk a lot about collaboration, but we still think about this silo. So if it happens to me, I’m not going to share that happen to me. And I think the example you give you a very open summit, it’s very important because in the end you have public investment, you have private investment, so we have taxpayers money, we have private investment. So how do you deal with that? Do you have specific practice how to attract private investment? Because it’s risk investment we want. And we want not to be that risk averse, so what’s your take? How do you attract private investment?

Sam Cho:
So when it comes to private investment, for instance in the terminal that I was just referring to, it’s a cruise ship terminal. And we went to the cruise operators and said let’s co-invest in this. And you really do have to make the argument that this is economical in addition to it being the right thing to do. In the northwest region we are blessed with hydrogen power. Our electricity comes from hydro dams. So actually our price per kilowatt is much lower than let’s say California. And so it actually makes economical sense for them to plug in as opposed to continue to burn the fuel. And so that’s a really easy argument for us to make. And then again, there are ways for us to incentivize cruise lines to get on board. We’ll give them a five to ten year lease extension. Maybe we’ll give them a better rate on their lease. And so there are mechanisms within a landlord-tenant relationship that you can pull when you’re negotiating for a co-investment in these things. A couple of other things that I’m seeing in the industry is off-take agreements. And I’m sure we will talk about this a little more later. But off-take agreements are becoming really popular, especially when there’s a speculation or uncertainty around the demand for a certain fuel. And so the idea that you can book or claim a future production of certain fuels so that there’s no question around whether or not you will be able to monetize it later is really, really helpful. And then lastly, in the aviation industry, we’re seeing a lot of what’s called booking claim. And so this idea that if you think about a lot of corporate… like Microsoft’s and Amazon’s who have made very aggressive climate reduction, greenhouse gas emission commitments, most of their greenhouse, their scope three is actually from travel, right? But they don’t control the airlines, obviously, right? So they’ve resorted to actually a book and claim where they basically purchase the carbon credits of production of these fuels that aren’t being produced locally. You could have a production facility in Europe that Microsoft purchases those carbon credits ahead of time, all right? So that’s why it’s called, you book it and then you claim it. And they claim those offsets for their emissions reduction goals. And so those are a couple mechanisms that I’m seeing in industry that are helping kind of finance this transition to clean energy.

Gordon Wilmsmeier:
Well, thank you. Before I continue with a question to you about Port Authority, Katharine, please, audience, don’t be shy. If you have a question, raise your hand and then we will involve you in our conversation. Dominik, there is, Dominik last. Yes, there’s a man behind you. So Katharine, but, so Sam talked about some initiatives.

Namrata Nadkarni:
The intention is that he’ll write it on a piece of paper and send it to us rather than.

Gordon Wilmsmeier:
No, no, he can ask. Oh, okay. But I’ll ask, I’ll ask Katharine first. So Port Authorities are quite important in this whole business. So what other recommendations would you have in the role for Port Authorities? Sam talked about some of the initiatives you can, are there other initiatives where you can say, hey, there’s a real different role of Port Authorities, also considering that we have a lot of time, local Port Authorities, global shipping lines, or we have national Port Authorities, but in small countries, but global shipping lines to deal with. So it’s not always easy in the power relationships as well, but you want to drive the transition. So how can we get the Port Authorities taking a proactive role in this process?

Katharine Palmer:
So the way, how I would say, I’ll caveat this with, I’ve never worked in Ports or Port Authorities, so this is. It’s from the outside.

Namrata Nadkarni:
There’s still time, Katharine.

Gordon Wilmsmeier:
But then, just what do you expect from them? What do you expect from them?

Katharine Palmer:
You may have a very different position to how I would say this, but I think, you know, I think every port is different. Every port has its uniqueness, particularly in its governance structure. And I think that is, you know, that’s an opportunity in the sense that, you know, so it’s not something to be seen as a negative, but I think we have to value those differences between each port. Some of them that are state-owned, you know, are very different to those that are privately owned. And maybe it’s the private ones might be able to move a little bit quicker than the state-owned ones or vice versa in some circumstances. And then it might be owned by one party, but then operated by another party. Then you’ve got to consider all the different customers that use the port and those. So I think, you know, the role of the authority is right at the center, and we always refer to ports as hubs, and they’re at this center, they’re at this nexus point where they can really pull together all these different stakeholders that have got an interest within the port. And I think that’s something that it’s value that, you know, just no one else can do. And that’s the role of the port authority has this real ability by sitting at the nexus point. And it’s not only, you know, how ports can then connect to the local community, the environment, you know, not only their own users, whether they’re transport or whether it’s industrial users. But I think, so I think I’d really see that as a strength of the port authorities and something that even if, you know, there’s no plan, there’s no, you know, it’s just to help problem solve. It’s helped to come up with a shared vision and shared goal and a shared plans and proposals. And I think that’s something that all port authorities have the ability to do, irrespective of, you know, their uniqueness and individuality.

Gordon Wilmsmeier:
I mean, I see Sam smiling and he wants to… You’re really happy with that role, aren’t you?

Sam Cho:
Yeah. I’m laughing because the term port authority implies we have authority. And my lawyers are always telling me what we can’t do as a port authority. Your points are all correct. And I think that our greatest strength is the fact that without us, you can’t do anything, right? We don’t really actually have a lot of regulatory authority. We’re not a regulatory agency. It’s really tough for us on the enforcement side. But I do think when it comes to collaboration, we are that natural convener. We are the hub. And the reality is that if you don’t work with us, you can’t work with us, right? That’s our leverage, ultimately.

Namrata Nadkarni:
I was going to add really quickly, you brought up a point earlier where you were trying to bake reporting into your lease agreements, right? We have tools. And the intention is not to say, port authority, as you said, you are the authority. You’re in charge of this. It’s to use every single instrument available to you, whether it’s regulatory, whether it’s financial ESG reporting, whether it’s just getting buy-in from voters for local government. You use every single tool to leverage each other to achieve aims. And as you said, Katharine, you’re completely right. Every port is different. Some are controlled by governments. Some are landlord ports. But the model, fundamentally, to say, you have to do this, and it’s not us being the bad guys. Look, here’s a rule. Here’s a regulation. Here’s a principle without which you don’t get green finance. That’s part of the solution. And those things exist. We just don’t use them very well to push against each other, because we feel like we’re competing. But it’s actually a way to level the playing field, which is great. And it’s what we’re always talking about in maritime is leveling the playing field. We should be using it. I know you’re waiting. Sorry.

Gordon Wilmsmeier:
Please also give your name and where you’re coming from.

Audience:
My name is Kana Mutombo. I’m from the American Bureau of Shipping. I’m based in Houston. My question is addressed to Dominik from the World Bank. By the way, it was very an excellent presentation.

Namrata Nadkarni:
Dominik can talk to you later.

Audience:
I attended the Port of the Future conference in Houston last month, and there were a lot of ports represented there. And what came out to me was that there’s been more and more talk recently that the future of decarbonization is actually nuclear. So what is the World Bank view on that?

Dominik Englert:
And there are two, I want to make it super brief. There are two pieces of it. There’s my personal opinion, and there’s the World Bank opinion. The World Bank opinion is an opinion that doesn’t exist yet that is currently being debated. But that is a request that I’m happily gonna forward to RJ Banga, our president. And he’s gonna put some pressure on the energy director kind of to solve that issue. It is funny, it was just two weeks ago we had Energy Learning Week at the World Bank. Nuclear was on the agenda. And you had, I would say, from what I heard, 50% of the people in favor, 50% of the people being very skeptical. If they had invited me, then it would have been 51% skeptical. Because I don’t think that it is, there’s a, let’s say, there’s a reason why nuclear hasn’t kind of brought all the benefits that we thought. We still kind of, we still haven’t solved the waste problem. We still haven’t solved the safety problem. And even if we solve them somehow, just when you look at the pure economics, and I said kind of, this is Dominik Englert’s opinion, that there’s pure economics, solar and wind is so much cheaper, and it’s expected to become even cheaper in the future, with floating solar, with offshore wind and all that stuff, that I don’t see any reason why we should go into an energy. source where we still haven’t solved the fundamental problems yet. However, this is very much digressing from the panel.

Namrata Nadkarni:
I actually want to really quickly give you a little bit of information that I think is relevant. Sorry, I just dived in. Basically, I think we like to look at shipping as a single whole. We know it isn’t. We know there’s lots of regional divisions. We know there’s different types of vessels. We know that some vessels are going to take to solar much better than others. We know some are going to take to methanol or whatever, depending on availability. We know that there are already nuclear-powered ships at sea. We know that other people are exploring them. Core Power is a really good example of a company that’s pushing their molten salt reactor. There are different solutions for different things. I think the point is not to say, how can we move to a single fuel future? That’s gone. Unless something really changes from all the data that everyone here is talking about, we are looking at a multi-fuel future. That’s not a case of saying, is nuclear viable? It’s under what conditions is nuclear viable, in which routes, on which ships? There are some where it would make sense. In the same way that a battery-powered ship, which most people are like, it’s not worth it, is viable for certain ferries that call it reasonable ports. I think looking at shipping as a single monolith is false.

Sam Cho:
I agree. I think the single biggest point that you touched about is that my understanding of small modular reactors is it’s very expensive, it’s cost-prohibitive. To have a nuclear reactor, it’s different to have a nuclear reactor to power a city versus a container ship. Just look at it from a cost standpoint. Unless it dramatically falls, I don’t see it being economical.

Dominik Englert:
Plus on top of this, sorry, Gordon, 30 seconds. On top of this, yes, there are nuclear-powered ships out there. We are basically talking about Navy ships and a couple of icebreakers, so very, very limited. There’s a reason why only the Navy or most of the Navy has it, and only the most powerful navies have it, because they can keep them safe and they can afford it.

Namrata Nadkarni:
We will talk over coffee, I’m not gonna take your time. It’s gonna be a radioactive conversation I’m down. We’ll talk over rum

Gordon Wilmsmeier:
All right, so that’s gonna be interesting Remember this conversation is gonna take place next to sustainable development goals But I think the the question of the energy source that we are going to use for the future is so interesting I mean Dominik mentioned again, and you should also in your presentation You will have new countries coming in and now Sam. What is your take on will we see a new geography of bunkering? Will the role of the port of Seattle in the new bunkering world change? Will we see a bunkering hub in Namibia or in Colombia? What is your feel on that? Yeah, so I do think this changes the fiscal landscape of ports, right?

Sam Cho:
I think no matter what fuel source we’re talking about here Whether it’s methanol hydrogen ammonia, the density is not the same which will mean two things either ships will get bigger Right, or they will have to refill more often Right. So I do think this does change the landscape of and the function, you know, whether or not You know ships are making more calls to different ports. You know, you didn’t mention carry less cargo. You’re like not an option. No Not my choice not my decision But I also think that you know When I look at the footprint of the ports like Seattle or Long Beach or LA or the major ports in the United States We’re very land constrained, right? Can we build can we even build a bunkering facility in Seattle is a huge question for us But what I do think is that you don’t necessarily need bunkering exactly at the terminals, right? It’s a very important point here in fact if you go to Port of Busan Port of Busan actually barges their fuel from the port of Busan and And refuel ships on the water side And I do think that that is a model for many ports that might be constrained geographically Where they collaborate with ports in their region, you know for us it might be the port of Everett Which is further north and they might have the bunkering and we might barge it down to Seattle and Tacoma to fill the cargo cargo vessels, right? And so I think that is important that when we talk about bunkering, when we talk about distribution of fuels, it’s not necessarily gonna be directly on the terminal. We’re gonna have to create an ecosystem within the region in order to make it work. And you might see multiple ports within a line of shipping routes with bunkering as well, given the nature of these fuels not being as dense as the traditional bunker fuel.

Gordon Wilmsmeier:
I think that’s interesting because you can tell maybe not it’s our rule, it’s some other port we need to get strategic involvement with. Katharine, how much is that a worry for you? You talked about the progress of having new vessels coming out, we see the new builds that are coming into the market. And how far do you think we will see new locations being part of the bunkering network or new countries coming part actually of this new energy maritime ecosystem?

Katharine Palmer:
So, I mean, we’ve got existing ports with existing bunkering operations. And for some ports, like the port of Singapore, it’s not gonna want to lose the fact that they have the number one bunkering port. But they might not have the land to be able to produce the fuels. But that’s like, as Sam said, you look to be able to import that from another location, and then you can still provide the bunkering facilities and the bunkering service. So I think that’s not going to, those top bunkering locations are still gonna want to be able to remain in the market for providing that service. And then obviously, like we said, we’re seeing that where the fuels are going to be produced are going to have to be transported to the existing bunkering ports. So, I mean, it’s no different to really what happens now. Not all bunkering locations are where there is an oil refinery that has heavy fuel oil as a waste product that they can just put into the marine market. So it gets shipped around as a product to the locations that it’s needed. So I think that is something that already happens and will continue to happen.

Gordon Wilmsmeier:
Okay, because I saw there is always this new opportunity or a different opportunity for emerging economies to play a different role in this, right? And I think a lot of countries are looking to move up the value chain within this sector. And I think that there is this ambition, okay, I’m producing renewable energy. I also want to create some more added value within my country, and maybe be participating in that.

Katharine Palmer:
I was going to say exactly, that’s exactly the case. If for the countries that have got the opportunity to be able to produce. green hydrogen or its derivatives of, then it can literally just export it all to somewhere else. Or if they do want to start producing, having a bunkering service, then that is also a possibility as well. But I think it also depends on whether they, they’ve got enough ships calling in to be able to do that or it just becomes an export thing. But everyone is gonna have their own. So there are opportunities, but that would be on a case-by-case basis.

Gordon Wilmsmeier:
Yeah, and I think it’s gonna be interesting. I’m coming to you, Murata. No worries, I’ll let you talk. No, no, it’s all good. Because you are part of the Alternative Fuel Action Working Group.

Namrata Nadkarni:
Well, for the Climate Action Program. It’s called WHPI-CAP.

Gordon Wilmsmeier:
Yeah, so are you-

Namrata Nadkarni:
It’s a great name.

Gordon Wilmsmeier:
It’s a great name. But how far are you supporting different locations being part of the bunkering network? What’s your take on that? Or are you gonna support the old traditional Singapore’s, Rotterdam’s?

Namrata Nadkarni:
Oh, I think that’s a false dichotomy. I don’t think that’s fair. And I think, you know, the point that we made about fuels not being as energy dense, there are, of course, opportunities. But we can’t just look at bunkering when we’re looking at the future fuel landscapes. There’s port of call as well, because you’re going to have ships with ammonia calling in your port. If you’re a tiny port, there are a whole bunch of safety protocols you’re gonna really have to think of to make sure that your staff and your marine environment is safe, because you don’t really want a bunch of ammonia in the water poisoning your fish and having your local fishing community really upset with you. So the intention is you need all the stakeholders to be working together. There are opportunities for smaller ports. And what we’ve done is we’ve put together the port readiness level for marine fuels. So I’m the chair of the working group. There are 13 or 14 ports in the program. And we’re about eight ports in my group. And what we’ve done is we’ve taken the NASA’s technology readiness levels, where you kind of go from just coming up with a concept all the way through to making sure your tech is actually market ready. really viable and we’ve applied it to ports looking at bunkering and we’ve applied it to ports looking at ports of call and we’ve got like a hope to do it for ships that will be carrying marine fuels as cargo which exactly comes to your point Katharine of kind of bringing it in so that it can then be distributed from a hub which distributes to local ports. So you go through nine levels, you don’t have to be level nine, it depends on what your port actually wants but you would go from doing kind of research through to development all the way through to deployment and this is a tool by the way that is available now. We are testing it right now, we need ports to be working with us so if you want to test this please Google it, we’re working, it’s basically an IAPH and World Port Climate Action Programme joint initiative so if you look at the IAPH website you can test it and in October at the World Ports Conference we’re going to be launching the digital version of this tool. It is a self-assessment tool but there is a lot of help available for it and basically what we want is everybody to talk to everybody so it’s not a port talking to themselves, it works for all models of ports whether you’re a landlord port or not and you talk to bunker suppliers, you talk to the shipping lines, you talk to your local government, you talk to your first responders who are going to be tasked with dealing with that, all of them in one thing and you go through the steps to make sure you have this resilience and you get there. So I think it’s a really, I mean obviously I’m a comms person as we keep saying, it’s a very important conversation if we don’t talk to each other, how on earth is somebody who’s ordering a ship now going to know where their ship can call by 2030, right? Otherwise we keep talking about stranded assets, we’re building it in by saying oh it’s a competitive advantage we won’t share information, it’s ridiculous. We need to talk to each other, don’t share your absolute financial details but talk about your plans.

Gordon Wilmsmeier:
Okay, I mean that’s a good point, I mean we had a very lively conversation, I would really invite Dominik to kind of give a short summary, maybe what we talked about. Do you dare to do that?

Dominik Englert:
to have a reactive, radio-reactive summary. And I think it’s the challenge is relatively big. The ever, the opportunity is in relative terms even bigger. And whether we see it as a challenge or as an opportunity depends on us. On you, on you, and you, and you, and you, and you. You’ve heard my opinion about nuclear. You don’t know my opinion about hydrogen, ammonia, methanol, biofuels, or whatever. I leave this up to you. Convince me, show to me, show to me, even if you want to persuade me that nuclear is the right option, you’re totally fine. Kind of go for it. And I’m more than happy to come back in 2026, whether it’s Saudi Arabia or so, where the next one is, and confess here live on stage that I’ve been wrong because you’ve developed the technology and the fuel that has put shipping on a 1.5 aligned decarbonization pathway. Totally fine, I confess here, and I’m gonna say kind of you’re the master. No, long story short, I’m super, super grateful that we’ve put together this panel because it took us quite some time at the World Bank to convince senior management that there is so much potential in ports to look at them now, to work with them now, to invest in them now, moving forward, a sector that we have, and I openly admit this here, slightly neglected for a couple of years. I would say we are back now. We think that overall decarbonization around the world has put ports and ships back on the agenda, not only of the World Bank, of many, many other players. And I think that’s a very good example of what we can do, and I think that the balance depends on us now, what we make out of this opportunity. It also depends on us, I see Ruhl in one of the last rows, I see Idea in one of the first rows. Maybe also Arsenio is hiding somewhere else in the room. He isn’t, unfortunately, but let’s not let them down. I’m also thinking about the World Bank and the World Bank as a policy framework. Stringent policy measures, I’m thinking in particular of a stringent green fuel standard and an ambitious economic measure, carbon pricing, emissions pricing at the IMO. When they provide us with an ambitious policy framework, it is up to us. It is up to us to make it happen. And I think that’s a very good example of what we can do, and I see Katharine as a winner of the hearts, Gordon from the academia side, and you, Namrata, kind of telling the story right. Not only telling the right story, but telling the story right. It’s up to us what we make out of it. I invite everybody really kind of to join forces and to sort our ship out together. I’m going to say a small thing for them, because, yeah, I know that you’ve probably hoped for a big grant and so on, yeah, the World Bank has decided to put all money in shipping decarbonisation from now on, so there’s no money left for panellists any more. The long-term investments. The long-term investments, but I’ve got a short-term pleasure instead. At the World Bank, we care about sustainability, and we also…

Namrata Nadkarni:
I’m just going to really quickly add a thing that I forgot to say. I’m also here as a representative of Wistia International, which encourages more gender diversity in our sector. If you’re a woman in the room, please join if you’re a man in the room, please also join because we want allies

Dominik Englert:
Fantastic excellent and Regardless of whether you are a woman or man or anything in between or beyond Tomorrow at 430. We have another exciting session in this room about policy at the IMO if you want to learn what is gonna what is needed in order to help these guys here live on stage and I’ll send you his current who is currently joining us Be here at 530 Again, be at all the other sessions in between and give another round of applause. And as I said We we want to we want to invest responsibly at the World Bank We also want to consume responsibly at the World Bank Usually I would have given a big bottle of rum to each of you now I didn’t want to get you into trouble on your flight I didn’t want to get you into trouble at any night when you may have emptied this with colleagues or friends so therefore I’ve gone for the I would say the soft version you get them you get a Big package of rum cake at least here from from the island Please enjoy and thank you so much for having been with us. Have a lovely evening. Thank you You You