DNV’s Knut Ørbeck-Nilssen: Decarbonization Efforts Need to Speed Up

The push towards decarbonization is slowing down rather than speeding up. With ambitious global goals looming ever larger on the horizon, what can we do to re-invigorate collective efforts? And profit from that push? Ahead of next year’s Nor-Shipping, Knut Ørbeck-Nilssen, CEO Maritime DNV, says efficiency, timing and people are critical to “getting this show on the road.”

Given the subject matter today, Knut Ørbeck-Nilssen seems remarkably optimistic.

“I’m a glass half full kind of guy,” he says. “But I’m also a realist, and that means I’m aware of the scale of what lies ahead and the need for pragmatic decision making.”

What lies ahead is decarbonization, and the scale is the IMO goals of a 20% emissions reduction by 2030, a 70% cut by 2040, and full-scale decarbonization by or around 2050. Goals that, on today’s trajectory, Ørbeck-Nilssen says we have “very little” chance of making.

There’s a need, he stresses, for the industry to “get its foot on the accelerator.” However, he’s also keen to paint a picture that isn’t exclusively colored green: “The fact of the matter is it makes as much commercial as environmental sense. There’s competitive advantage waiting for those owners and operators prepared to think differently and adopt innovation here.”

Green fuel challenge

Starting in the slow lane, the DNV chief nods to low scrapping volumes as a key indicator of glacial fleet renewal. This is unsurprising, he opines, in the context of high charter rates, continued uncertainty over long-term solutions (and the scale of investment required in those) and the lack of adequate progress in green fuel supply.

Here he points to DNV’s recent Maritime Forecast to 2050 which details that for shipping to meet its 2030 target the industry will need to secure between 7 and 48 Mtoe of carbon-neutral fuels. However, total global production of these energy sources is only expected to reach between 44 and 63 Mtoe by that juncture.

“The cross-sector demand will be huge,” Ørbeck-Nilssen states, “from other transport modes, manufacturing, domestic supply, further industrial consumers, and more. Shipping has to stand in line here, so what can we do?”

Small steps, huge gains

Ørbeck-Nilssen is a long-time exponent of a “don’t let perfect be the enemy of good” philosophy, actively supporting the adoption of “less emitting” fuels, such as LNG, instead of waiting for shipping’s next silver bullet. He’s pleased by the growth of dual-fuel solutions on the orderbook for the years to come, but today wants to shift focus to what can be done “right now, today” to start making the gains – both green and ‘greenback’ – all stakeholders want to see.

“Reducing energy losses, in other words greater efficiency, is the most straightforward way for the global fleet to cut fuel consumption, emissions, and, by extension, energy costs,” he says.

Here he refers back to the Maritime Forecast report, which highlighted that operational and technical energy efficiency measures could cut fuel consumption by between 4 and 16% by 2030.

“Which, in itself, is a very large step on the way to that first IMO goal,” Ørbeck-Nilssen stresses.

Just to put those percentage figures into context, 16%, on the scale of the world fleet, is the equivalent of operating the 55,000 smallest ships, or the 2,500 largest vessels, with completely carbon-neutral fuel. In other words, a giant slice of 120 MtCO2 out of the current emissions pie. Or, from a bottom-line perspective, almost a fifth of current fuel costs.

It’s time, he suggests, to “harvest the low hanging fruit.”

Carrots not sticks

There’s plenty of technology, Ørbeck-Nilssen states, that’s ripe with opportunity.

Wind assisted propulsion, for example, hangs heavy on the bough, with proven solutions able to deliver immediate gains from a readily available, free and inexhaustible energy source requiring zero infrastructure or supply development. Air lubrication on hulls also delivers powerful energy efficiencies, as does waste heat recovery systems, battery hybridization and greater utilization of shore power.

And digitalization is, of course, enduringly high on the agenda, with speed, route and performance optimization, as well as ‘just in time arrivals’ capable of unlocking significant benefits.

However, rather than listing everything he prefers to stress the “menu” of choices, noting: “Clearly, not everything will be suitable for every vessel or business, so it’s up to the owners to gauge what solutions are the best fit for their individual assets, operations and strategies. Getting that combination right can pay huge dividends.”

As proof of this, retrofitting new bulbous bows on container ships enters the conversation, with these alone capable of delivering efficiencies of up to 10-15%.

“You can choose to look at that as an environmental issue,” he says, “but shipping is a business, and that should provide a strong business case for any owner.”

It is, he suggests, sometimes smarter to frame discussions around the carrot of commercial gain, rather than the stick of penalties, or guilt for that matter.

“Payback time on these solutions is often very short,” he adds, “and from there on in it’s pure savings, and competitive advantage.”

Corridors of opportunity

In terms of impact, Ørbeck-Nilssen says onboard carbon capture (OCC) may not get the column space, or interest levels, it deserves, as, in his words, it’s “arguably the most effective single way to decarbonize shipping.”

However, as with the aforementioned green fuels, it’s not as straightforward as the smorgasbord of available efficiency measures.

“There’s an infrastructure requirement that needs to be satisfied,” he comments. “The technology for onboard capture is already maturing, but we need to have the reception facilities, and other handling infrastructure, in place. This could be vital taking the pressure off of green fuel supply, so this should be a prioritized area of focus.”

He’s sees ‘carbon capture corridors’ as a means of facilitating greater development, with agreements between key hubs to create the required infrastructure, thus opening up major green routes and showcasing potential to the rest of the industry.

“We have to invest in these first steps for the sake of wider future progress,” he stresses, “and for that we need stronger headline collaborations.”
Nor-Shipping partnership

With multiple pathways of opportunity ahead of us, continuing uncertainty (both energy-wise and geopolitically) and the pressing need for collaboration, Ørbeck-Nilssen says we need to turn to the industry’s greatest asset – it’s people.

This, he says, is one of the key reasons DNV continues to play such a prominent role in Nor-Shipping, where it is one of the two main partners (along with DNB) for the 2025 program.

“Firstly, I have to say Nor-Shipping has a knack of staying relevant,” he states, “and I think that is kind of summed up by the theme of the 2025 show (#future-proof). That sits perfectly with what I’ve been discussing today – the solutions that can help our industry navigate the future with confidence.

“But I think one of its prime strengths is its capacity to bring such a broad range of international stakeholders together in the same place, to discuss the issues that really matter. When facing the challenges we do today, knowledge sharing, partnerships and accessing innovation are absolutely critical to progress. I mean, shipping moves the world forwards – look at our spirit of discovery and innovation – and platforms like Nor-Shipping are essential for enabling that.”

Finishing on the future-proof focus, Ørbeck-Nilssen also stresses the need to attract the right new people to the industry to make good on the potential he so clearly identifies.

“Recruiting talent from the next generation is perhaps one of the most important challenges ahead,” he says. “Young people will be essential to finding solutions, both on vessels and on shore, that will, I hope, allow us to accelerate towards those all-important goals.”

And, given the competition from other industries, does he believe this is possible?

“Absolutely,” he says, “this is a fascinating career, with huge opportunities. And, of course, I’m a glass half-full kind of guy.”