Dubai's Agility and Maersk lead way to cut greenhouse gas emissions

Agility, the Dubai-based global logistics provider, has signed an agreement with Maersk Line, the world’s largest container ship operator, to cut CO2 emissions by 15 per cent per container transported on Agility shipments by 2020.

The agreement is part of Maersk’s Carbon Pact Challenge, an initiative under which the ocean carrier and its customers work together to drive down emissions and reduce the environmental impact of shipping.

As part of their agreement, Agility and Maersk will look for ways to cut emissions by shipping cargo on more fuel efficient ships, optimising shipping networks and routes, they said, and other steps to reduce CO2 emissions such as working on how to integrate CO2 emission indicators into the regular business information flow and procurement of ocean shipping.

“Responsible companies are looking for innovative, commercially viable ways to reduce the impact of their business on the environment,” said Cas Pouderoyen, the Agility senior vice president for Global Ocean Freight. “In Maersk, we have one of the most creative and committed partners in the shipping industry. Our Carbon Pact partnership with them will benefit Agility customers and the planet.”

The International Maritime Organisation says ocean shipping accounts for 10 per cent of global CO2 emissions for transport. Road vehicles (73 per cent) and air transport (12 per cent) are the top sources of the greenhouse gas.

In a bid to address the aviation industry’s emissions, leading airlines are supporting a United Nations proposal to limit pollution from international flights – even though the measure may eventually cost companies US$24 billion annually.

Trade groups representing United Continental, Boeing and other industry leaders are pushing nations to join the agreement, which would require companies to offset their emissions growth by funding environmental initiatives. The accord, being brokered in Montreal during 11 days of talks beginning on Tuesday, would be the first global climate pact targeting a single industry.

The industry was largely omitted from the Paris accord on climate change last year because delegates feared divvying up responsibility for global airline routes could derail the broader deal. With aviation emissions forecast to triple by 2050, airlines believe that regional or global regulation is inevitable. If their pollution must be controlled, airlines would prefer a single international standard, saying it would be far cheaper and easier than following a patchwork of local programmes.

“We recognise that as an industry, we have an impact on climate change,” said Michael Gill, the executive director of the Air Transport Action Group, which represents airlines, engine makers, airports and pilots. “The industry is willing to pay its share. We just want to pay our share in the most economic way possible.”

To be clear, the 15-year agreement would not force airlines to cut their pollution. Instead, companies would compensate for any emissions growth after the accord begins in 2020 by buying credits that back renewable energy development, forest preservation or other environmental endeavors. Airlines estimates the annual industrywide cost may be as much as $23.9bn by 2035, or 1.8 per cent of projected revenue.

If the UN-sponsored deal fails, companies run the risk of facing even costlier regulation if Europe or others push ahead with regional plans.

The bid for a global emissions deal rose to the top of the aviation agenda in 2012, after the European Union said it would require airlines to buy carbon permits for all flights in and out of Europe. That triggered outcry from China, Egypt, Brazil and other nations that argued the measure was beyond the EU’s authority. Europe agreed to suspend its effort and allow nations to negotiate an international deal.

Officials plan to finalise the agreement during the talks that begin this week, hosted by the UN’s International Civil Aviation Organisation. More than 2,000 delegates are expected to attend, making it the organisation’s largest assembly ever. Success is far from certain.

The current proposal calls for Delta Air Lines, Deutsche Lufthansa and other industry leaders to initially subsidise the growth of smaller carriers.

Over time, all airlines would be responsible for offsetting their own emissions growth. The United States has pushed for that transition to happen as soon as possible. Brazil and other developing nations have argued for it to happen slowly.

European Union Transport Commissioner Violeta Bulc said the 28-nation block would strive to ensure credits are certified by the United Nations.

“This will be the first-ever global carbon-reduction deal for a single industry,” Ms Bulc said. “I hope that we can encourage other sectors to follow. It is a critical time for action.”

Follow The National’s Business section on Twitter

Share This Post