decarbonisation targets — Decarbonisation targets in shipping must focus on energy efficiency rather than becoming fixated on alternative fuels that currently lack the necessary infrastructure, warned George Pateras at the recent 9th Capital Link Cyprus Shipping Forum.
Pateras, an executive at Contships and former president of the Hellenic Chamber of Shipping, expressed concern that the industry’s efforts to decarbonise may drift away from both technical and economic realities. He highlighted that emissions have already been significantly cut over the past two decades, even before the International Maritime Organisation’s (IMO) ambitious goal of achieving ‘Net Zero’ by 2050.
“Shipping has already significantly reduced emissions over the last 20 years without ‘Net Zero’,” Pateras stated. He elaborated that the term ‘Net Zero’ should not be misconstrued as zero emissions, but rather as a benchmark for taxation aimed at those exceeding established limits.
The discussion around environmental taxation, he argued, is becoming a convenient policy tool for the IMO and the EU. “The IMO and the EU need money, and what better way to collect it than through environmental taxes on transport, without losing votes?” he said.
Pateras provided context for the current emission levels, noting that the CO2 concentration in the atmosphere is at 440 ppm, with anthropogenic emissions contributing only 16 per cent of that. Shipping, he pointed out, is responsible for a mere 3.8 per cent of these emissions, translating to less than 3 ppm. “We spend billions to save 3 ppm, parts per million, while the rest of the world continues to burn, smoke and produce cement,” he commented.
He also raised alarms about the emergence of regional emissions regimes in Europe and Africa, which he believes could lead to fragmentation and uncertainty within the industry. “Of course they worry me. It’s hard to get three people to agree on something outside their comfort zone; imagine the IMO or the EU!”
Pateras expressed astonishment at how confident non-experts appear in discussions about green laws, which he views as largely political tools lacking substantial cost or effectiveness analyses. “I’m amazed at how confident non-experts are, while scientists and engineers have serious doubts,” he said.
On the topic of alternative fuels, he acknowledged that major shipping companies have begun to order vessels capable of running on methanol or LNG. However, he pointed out that very few of these vessels are actually operational on those fuels; most are merely marked as “ready.”
For Pateras, improving energy efficiency is currently the only feasible route for the industry, with a future shift possibly towards nuclear power. He cautioned that the infrastructure required for alternative fuels carries significant environmental burdens, stating, “The infrastructure for alternative fuels requires huge carbon emissions to build bunkering stations, which often outweigh any savings it promises.”
Shifting focus to the feeder segment, where Contships operates within the 1,000–2,000 TEU capacity range, Pateras remarked on the under-investment in this area. “We are the largest private feeder operator in the 1,000–2,000 TEU capacity segment,” he affirmed, noting that orders in this category represent only 7 per cent of the existing fleet, while other sizes boast numbers as high as 50 per cent.
He emphasised the need to replace older, fuel-intensive feeders, stating, “Most feeders are old and fuel-intensive. So yes, they need to be replaced.” However, he remained cautious about whether investments in newer vessels would yield significant returns, acknowledging the unpredictability of market conditions. “Whether they will pay off depends on the purchase price and the charter market; without a crystal ball, I cannot predict,” he said.
Despite the uncertainties, Pateras remains optimistic about the fundamentals of the feeder market. He believes that demand will continue to be strong, particularly as larger mother vessels enter the market and as small feeders serve vital supply chain links to growing ports with less developed infrastructure. “Their market is not going to weaken,” he concluded.
