Haakon Lindstad Marintek, Trondheim - Norway

Gdansk 29.April - 2008

Shipping and Carbon Footprint, methodolgy to for developing a fair and

descent system

2

Development of World Energy Consumption 1990 to 2004

Source: Lindstad, World Energy Outlook

141.7561.5462811.2048.732Total final consumption, energy demand

13588522243.3822.959Residential/ Agricultural/ Losses

29361279382.1341.549Transport

2378371182.5102.134Industry

15429374523.0562.090Electricity generation &heat plants

Change in %20041990Change

in %20041990

The European UnionThe WorldEnergy consumption in million ton oil equivalent units (Mtoe)

Source: Lindstad, World Energy Outlook

141.7561.5462811.2048.732Total final consumption, energy demand

13588522243.3822.959Residential/ Agricultural/ Losses

29361279382.1341.549Transport

2378371182.5102.134Industry

15429374523.0562.090Electricity generation &heat plants

Change in %20041990Change

in %20041990

The European UnionThe WorldEnergy consumption in million ton oil equivalent units (Mtoe)

3

In March 2007 The Europen leaders meet. They agreed that the energy consumption in 2020 shall be reduced by 20 % compared to 1990. “Today companies are held responsible for the environmental impact of the activities within their own part of the value chain. For the future however, the Commission reveals that manufacturers will be held responsible for the green audit of the whole life cycle of the product, from raw material to consumer good” (from ‘cradle to grave’).

ManufacturerEnvironmental KPI’s for manufacturer

DistributionRaw material processing

Regionalwarehouse

Food Mart

InventoryComponent transport

Factory

Recycling

Food Mart

Food Mart

Food Mart

3PL service

ManufacturerSupplier end Customer end

ManufacturerEnvironmental KPI’s for manufacturer

DistributionRaw material processing

Regionalwarehouse

Food Mart

InventoryComponent transport

Factory

Recycling

Food Mart

Food Mart

Food Mart

3PL service

ManufacturerSupplier end Customer end

AS-IS:

TO-BE:

The New Enviromental picture of Europe

4

Key European Transport Figures 2004 (EU 25)

Inland Waterways

Short Sea Shipping

2004 2004 2004 2004Billion tonn km 1 684 379 129 1 484Million Vehicle km 169 052 2 046 320 382Million Tonn transported 15 202 828 465 1 093Yearly nr of voyages/journeys in millions 1520,20 4,48 1,15 0,28Average travel distance in km per voyage 111 457 277 1 358Average amount in Ton per voyage 10 185 403 3 887Fuel Consumption in gram per tonn km 50 26 22 12Mtoe - Callculated Million ton oil equivalents 83,36 9,66 2,78 17,81Average Carbon Footprint in gram CO2 per tonn km 156 81 68 38Teoretical Best case (100 % utilization) Carbon Footprint in gram CO2 per km 51 26 20 14

Road Rail

Source: Lindstad, European transport policy for 2010 : time to decide

5

Example of ‘complete’ mapping;StakeholdersRoleSPIOperational KPI sDiagnostic KPI s

Role

SPI

Operational KPIs

Diagnostic KPIs

Regulator

Environmental Sustainability

Energy Efficiency

SOx NOx Incident-Related Spills

Ballast Handling

Emitted mass (CO2)

Transport Work (t/m)

Sulphur in Bunker

NOx-Factor Cleansing-Effect

Stakeholders

Port State Flag State Port/Channel Authorities

Multi-National Governmental Organisations

Non-complete mapping due to visual reasons

The role will also have interest in other SPIs but only one SPI is shown due to visual reasons

Other roles (hence other stakeholders) will also have interest in the SPI but only one role is shown due to visual reason

PMVOC

Cargo Incidents

The Enviromental Performance area and some of the relevant KPI’s

6

HOW TO MAKE A MODEL OF THE SEA TRANSPORT MARKET AND THE REAL ENERGY CONSUMPTION

Summary of vessel databaseNumber of vessels in size group

Average dwt Average sailing

distance

Vessel speed

Cargo voyages

Repositioning

voyages

Total engine size

[kW]

Annual bunker

consumtion per vessel

[tonn]

Total cargo transported

(million tonn)

Billion tonn miles

Total bunker consumption

per vessel size group

[tonn]

Bunker consump-

tion in gram per tonn-nm

Total CO2 emission [tonn]

Dry bulk Capesize 120'-> 762 171.643 7500 13 5,5 4,5 15.326 16.231 626 4.696 12.367.697 2,63 39.044.820 Post-Panamax 85'-120' 114 93.826 6500 13 6,5 5 12.005 12.636 60 390 1.440.504 3,69 4.547.672 Dry Bulk Panamax 60'-85' 1417 72.072 5500 12 7,5 4,5 9.784 9.914 660 3.630 14.048.397 3,87 44.350.790 Dry Bulk Handymax 35'-60' 1876 45.904 5000 12 8,5 5 8.179 8.465 631 3.157 15.879.538 5,03 50.131.701 Dry Bulk Handysize 15'-35' 1895 26.077 3000 12 13 7 6.652 6.246 523 1.570 11.835.999 7,54 37.366.250 Coastal 5-15' 453 9.364 2500 12 17 8 3.500 3.378 59 147 1.530.260 10,39 4.831.031 Small Bulk vessels 0-5' 849 1.587 1000 12 40 20 1.006 923 43 43 783.955 18,11 2.474.947 Total Dry Bulk 7366 2603 13.634 57.886.351 4,25 182.747.211

Reefer fleetReefer vessel 10'-15000 dwt 201 11.677 3000 19 18 14 11.000 10.396 32 96 2.089.556 21,88 6.596.727 Reefer vessel 5'-10000 dwt 374 7.163 2000 17 24 18 6.390 5.959 38 75 2.228.739 29,56 7.036.128 Reefer vessel 0- 5000 dwt 620 1.966 1000 12 45 25 1.808 1.942 35 35 1.204.141 34,25 3.801.473 Total Reefer 1.217 5422 108 221 5.814.909 26,33 18.357.668

Container fleetContainer 8500 TEU, 90' -> 182 105.968 11.000 24 11 0 66.956 64.409 119 1.310 11.722.348 8,95 37.007.452 Container 6500 TEU, 70'-90' 160 80.256 11.000 24 11 0 60.394 58.096 79 867 9.295.331 10,72 29.345.359 Container 4000 TEU, 40'-70' 1.023 55.285 7.000 24 15 0 37.003 31.325 473 3.308 32.045.497 9,69 101.167.633 Container 2300 TEU, 25'-40' 750 33.281 2.500 22 33 0 19.964 14.711 468 1.169 11.033.097 9,43 34.831.489 Container 1400 TEU, 15'-25' 809 20.484 1.000 18 50 0 12.596 7.243 425 425 5.859.185 13,80 18.497.447 Container 700 TEU, 5'-15' 1.115 9.940 800 17 50 0 6.671 3.426 312 250 3.819.650 15,29 12.058.634 Total Container 4.205 23.875 1902 7.343 74.018.614 10,08 233.676.764

Dry Bulk fleet

7

Summary per vessel segment Number of vessels in size group

Average dwt

Total DWT in millions per

Vessel segment

Total cargo transported

(million tonn)

Billion tonn miles

Total bunker consump-tion in million tons

Bunker consump-tion in gram per

tonn-nm

Estimated Carbon Footprint in gram Co2 per tonn km based upon real

operational patterns

Theoretical Carbon

Footprint in gram Co2 per

tonn km

Estimated capacity utilization

Total CO2 emission

[tonn]

Dry Cargo 15'++ 1.166 24.925 29.062.990 365 1.096 7.721.801 7,05 12,26 7,52 61 % 24.377.725Dry Cargo 5'-10' 2.564 6.950 17.820.520 465 465 5.806.614 12,48 21,71 13,02 60 % 18.331.480Dry Cargo 1'-5' 7.606 2.543 19.341.764 685 342 5.947.603 17,38 30,22 18,13 60 % 18.776.582Dry Cargo 500-1' 2.423 713 1.727.568 55 27 880.626 32,31 56,19 33,71 60 % 2.780.136Dry bulk Capesize 120'-> 762 171.643 130.792.067 626 4.696 12.367.697 2,63 4,58 2,27 50 % 39.044.820Post-Panamax 85'-120' 114 93.826 10.696.206 60 390 1.440.504 3,69 6,42 3,27 51 % 4.547.672Dry Bulk Panamax 60'-85' 1.417 72.072 102.126.370 660 3.630 14.048.397 3,87 6,73 3,79 56 % 44.350.790Dry Bulk Handymax 35'-60' 1.876 45.904 86.115.320 631 3.157 15.879.538 5,03 8,75 4,96 57 % 50.131.701Dry Bulk Handysize 15'-35' 1.895 26.077 49.416.405 523 1.570 11.835.999 7,54 13,11 7,24 55 % 37.366.250Coastal 5-15' 453 9.364 4.242.005 59 147 1.530.260 10,39 18,07 10,44 58 % 4.831.031Reefer vessel 10'-15000 dwt 201 11.677 2.347.135 36 107 2.062.515 19,25 33,49 17,17 51 % 6.511.360Reefer vessel 0- 5000 dwt 620 1.966 1.219.007 42 42 1.203.536 28,84 50,15 26,79 53 % 3.799.562Container 8500 TEU, 90' -> 182 105.968 10.291.418 119 1.310 11.722.348 8,95 15,56 10,89 70 % 37.007.452Container 4000 TEU, 40'-70' 1.023 55.285 33.124.988 473 3.308 32.045.497 9,69 16,85 11,79 70 % 101.167.633Container 2300 TEU, 25'-40' 750 33.281 20.365.060 468 1.169 11.033.097 9,43 16,41 11,49 70 % 34.831.489Container 700 TEU, 5'-15' 1.115 9.940 8.018.397 312 250 3.819.650 15,29 26,60 18,62 70 % 12.058.634Container 200 TEU, 0-5' 166 3.102 502.617 27 13 243.507 18,22 31,69 22,18 70 % 768.751Crude oil tanker 200-+ 510 294.132 150.007.123 574 5.165 12.518.007 2,42 4,22 2,00 48 % 39.519.349Crude oil tanker 120-199,9' 362 151.510 54.846.652 299 1.795 5.819.447 3,24 5,64 2,68 48 % 18.371.994Crude oil tanker 75-119,9' 658 102.822 67.656.817 619 1.238 4.534.920 3,66 6,37 3,03 48 % 14.316.743Crude oil tanker 50-74,9' 190 66.620 12.657.800 162 162 764.252 4,73 8,22 3,90 48 % 2.412.744Product, chemical 40'-++ 489 47.686 23.318.475 269 1.347 3.699.974 2,75 4,78 3,05 64 % 11.680.818Product, chemical 25'-40' 449 34.563 15.518.565 172 690 3.349.753 4,86 8,45 5,41 64 % 10.575.170Product, chemical 15'-25' 333 19.107 6.362.680 127 317 1.370.135 4,32 7,52 4,81 64 % 4.325.517Product, chemical 5'-15' 970 9.098 8.824.742 247 247 1.604.004 6,48 11,28 6,85 61 % 5.063.842Product, chemical 0-5' 1.385 1.992 2.758.311 127 64 706.378 11,11 19,33 11,16 58 % 2.230.035RoRo 15'-25000 336 18.482 6.210.053 132 198 2.542.364 12,87 22,38 15,67 70 % 8.026.242RoRo 5'-15000 671 9.833 6.597.688 205 164 2.821.506 17,19 29,90 20,93 70 % 8.907.495RoRo 0'-5000 1.286 1.317 1.693.485 149 74 1.955.753 26,33 45,80 32,06 70 % 6.174.311RoPax 5' - 10' 228 6.639 1.513.584 167 73 5.470.369 49,78 84,67 42,33 50 % 17.231.663 RoPax 0 - 5' 2.475 845 2.092.069 230 92 13.139.613 95,19 161,91 80,96 50 % 41.389.780 LNG 60'+ 212 75.441 15.993.528 87 696 4.929.860 7,08 12,32 5,85 48 % 15.563.569LPG 45'++ 113 52.874 5.974.802 48 242 1.590.280 6,58 11,45 5,44 48 % 5.020.514LPG 5'-15' 195 7.960 1.552.143 31 31 499.153 16,12 28,03 13,31 48 % 1.575.825LPG 0'-5' 645 2.114 1.363.369 31 31 815.474 26,62 46,29 21,99 48 % 2.574.450TOTAL CARGO 41.486 334.189 969.132.949 9.916 36.355 232.322.440 5,90 10,26 733.308.982

8

Main Figures per vessel group

Summary per vessel segment

Number of

vessels in size group

Average dwt

Total DWT in millions per

Vessel segment

Total cargo transported

(million tonn)

Billion tonn miles

Total bunker consump-tion

in million tons

Bunker consump-tion in gram per

tonn-nm

Estimated Carbon

Footprint in gram Co2 per tonn km based

upon real operational

patterns

Estimate

Total CO2 emission

[tonn]

General Cargo FleetTotal General Cargo 16.601 4.612 76.568.255 1.729 2.225 23.843.175 10,71 18,63 75.272.904

Total Dry Bulk 7.366 52.231 384.735.783 2.603 13.634 57.886.351 4,25 7,38 182.747.211Reefer fleetTotal Reefer 1.217 5.422 6.598.420 129 260 5.791.565 22,28 38,75 18.283.970Container fleetTotal Container 4.205 23.875 100.395.981 1.902 7.343 74.018.614 10,08 17,53 233.676.764Oil tanker fleetTotal Crude oil 2.055 143.061 293.989.385 1.854 8.379 23.786.064 2,84 4,94 75.092.604Product, chemical fleetTotal product & Chemical 3.626 15.660 56.782.773 943 2.664 10.730.245 4,03 7,00 33.875.382RoRo fleetTotal RoRo (excluding Ropax) 2.360 7.089 16.731.136 507 548 8.285.106 15,11 26,28 26.156.080RoPax fleetTotal RoPax 2.728 1.984 3.943.400 180 18.994.281 70,47 105,70 59.831.985LNG fleetTotal LNG 248 68.854 17.075.828 97 730 5.234.933 7,17 12,47 16.526.683LPG fleetTotal LPG 1.080 11.400 12.311.988 152 390 3.752.106 9,61 16,71 11.845.399

TOTAL CARGO 41.486 334.189 969.132.949 9.916 36.355 232.322.440 5,90 10,26 733.308.982

Dry Bulk fleet

9

The Cargo Short Sea Fleet

Summary per vessel segment

Number of vessels in size group

Average dwt

Total DWT in millions per

Vessel segment

Total cargo

transported

(million tonn)

Billion tonn miles Total bunker

consump-tion in million tons

Bunker consump-tion in gram per

tonn-nm

Estimated Carbon

Footprint in gram Co2 per tonn km based

upon real operational

patterns

Theoretical Carbon

Footprint in gram Co2 per

tonn kmEstimated capacity utilization

Total CO2 emission

[tonn]

General Cargo FleetDry Cargo 10'-15' 658 12416 8.169.663 145 289 2.962.710 10,24 17,82 10,69 60 % 9.353.277Dry Cargo 5'-10' 2564 6950 17.820.520 465 465 5.806.614 12,48 21,71 13,02 60 % 18.331.480Dry Cargo 1'-5' 7606 2543 19.341.764 685 342 5.947.603 17,38 30,22 18,13 60 % 18.776.582

Coastal 5-15' 453 9364 4.242.005 59 147 1.530.260 10,39 18,07 10,44 58 % 4.831.031Small Bulk vessels 0-5' 849 1587 1.347.410 43 43 783.955 18,11 31,49 17,84 57 % 2.474.947Container fleetContainer 700 TEU, 5'-15' 1115 9940 8.018.397 312 250 3.819.650 15,29 26,60 18,62 70 % 12.058.634Container 200 TEU, 0-5' 166 3102 502.617 27 13 243.507 18,22 31,69 22,18 70 % 768.751Product, chemical fleetProduct, chemical 5'-15' 970 9098 8.824.742 247 247 1.604.004 6,48 11,28 6,85 61 % 5.063.842Product, chemical 0-5' 1385 1992 2.758.311 127 64 706.378 11,11 19,33 11,16 58 % 2.230.035RoRo fleetRoRo 5'-15000 671 9833 6.597.688 205 164 2.821.506 17,19 29,90 20,93 70 % 8.907.495RoRo 0'-5000 1286 1317 1.693.485 149 74 1.955.753 26,33 45,80 32,06 70 % 6.174.311RoPax fleetRoPax 10' - 15' 20 11.787 235.731 26 10 326.329 20,97 35,67 17,84 50 % 1.027.937 RoPax 5' - 10' 228 6.639 1.513.584 167 73 5.470.369 49,78 84,67 42,33 50 % 17.231.663 RoPax 0 - 5' 2.475 845 2.092.069 230 92 13.139.613 95,19 161,91 80,96 50 % 41.389.780

Total sellected segments 20.446 83.157.986 2.886 2.275 47.118.251 20,71 148.619.765

Total fleet 41.486 334.189 969.132.949 9.916 36.355 232.322.440 5,90 10,26 733.308.982

Out of total 49 % 9 % 29 % 20 % 20 %

Dry Bulk fleet

10

The trend during the last 30 years in shipping is that nearly all the focus has been on developing efficient vessels from 30 000 dwt upwards to 300 000 dwt, while the SSS feet has been more or less neglected. This can be illustrated by the order books for new building versus the active fleet

Dry bulk, container vessels, oil tankers and chemical tankers

0

500

1.000

1.500

2.000

2.500

3.000

0 40.000 80.000 120.000 160.000 200.000 240.000 280.000

dwt

#

Active fleet New orders

11

Logistics and Distribution scenarios

Scenario 1 Full Growth

Scenario 2 Full Growth to 2014 then Growth to 2020

Scenario 3 Full Growth to 2014 then near zero Growth post 2014

Scenario 4 Full Growth to 2014 then no/negative Growth

Col

laps

ing

Econ

omic

con

fiden

ce

post

20

14

Trad

e/Tr

ansp

ort

requ

irem

ent

2008

20

14

2020

Trad

e/Tr

ansp

ort

requ

irem

ent

2008

20

14

2020

Trad

e/Tr

ansp

ort

requ

irem

ent

2008

20

14

2020

Trad

e/Tr

ansp

ort

requ

irem

ent

2008

20

14

2020

Dramatic increase in need for attention to environmental performance required, this could be the result of a large

increase in oil price. Change phased in from 2014

12

What can be done?

Saling vessels New vessels

2010-2020

Future vessels

Post 2020

13

SST.2008.2.1.4 Continental Shipping -Sustainable Shipping The main idea in this proposal will be to focus on Improvements for vessels in the

range 0 – 25 000 dwt since these vessels are the ones which is used in Short sea Shipping. The trend during the last 30 years in shipping is that nearly all the focus has been on developing efficient vessels from 30 000 dwt upwards to 300 000 dwt (the deep sea fleet), while the SSS fleet has more or less been neglected. Due to this the following comparison can be made:

Energy efficiency Deep/sea versus short sea fleet: 1 / 10 + (carbon footprint 3g/tonnkm versus + 50g/tonn km (best versus worst)

Steel weight Deep sea/versus short sea: 1 / 10 + (Best in deep sea fleet payload/ steel weight 10 +/ 1, Short sea 1 / 2 +)

Short sea versus trucking: The trucks have improved their position both regarding Payload/ own weight and regarding CO2 emissions. So unless SSS improves trucks will be far ahead a few years into the future

14