Stagnation in R&D investment creating unacceptable risk for industry zero emissions future - ICS
The International Chamber of Shipping (ICS) has warned that without decisive government signals declining levels of Maritime research and development could jeopardise industry’s ability to decarbonise.
According to the International Energy Agency (IEA), Maritime’s research and development (R&D) spending between 2007-2019 remained stagnant, lagging far behind that of other sectors. Responding to strong political signalling from governments around the world investment on R&D in the automotive sector has increased from 67 billion USD in 2009 to a staggering 130 billion USD in 2019, compared to 1.6 billion USD in maritime. The total amount of Corporate R&D investment for maritime actually decreased, from 2.7 billion USD in 2017 to 1.6 billion USD in 2019 according to the IEA.
Ahead of a key meeting of IMO member states in London this week, ICS, which represents 80% of the world’s merchant fleet, has highlighted that growing uncertainty is leading to a reduction in confidence about R&D investment. The lack of clarity, in part due to the increasing levels of political risk and resulting investment risk, is leading to limited R&D investment for ‘green’ fuels for ships, and the accompanying technologies they need to be safely used. There is also growing concern about the safety and toxic emission associated with the use of some proposed alternative fuels. Without government support for rapid research and development, this will add unacceptable levels of risk to investments made in shipping by both the public and private sector.
As technology development is traditionally uncertain and takes time, ICS is co-sponsoring, along with 10 governments and industry partners, a 5 billion USD R&D fund for shipping – the IMRF, which provides certainty through guaranteed 10-year funding to support the ‘de-risking of investments’ for advancing technology readiness levels.
ICS is calling for a clear political signal now so that investment can be brought forward to create the technologies needed to decarbonise the industry. The evidence is clear from other sectors that this is what is needed. Like other industrial sectors we also need governments to send a clear political signal that they are serious about the development of a global market-based measure to create the business models that will incentivise the adoption of these new fuels and technologies.
ICS along with other shipping bodies have already called on world leaders to bring forward discussions on global market-based measures.
