In the next decade, seaborne trade demand is predicted to grow by 26%, from 62.5 Gt-nm (2019) to 78.7 Gt-nm (2030). This steady growth will coincide with a decade of significant steps towards decarbonization and investment in digitalization.Making decarbonization count
All maritime stakeholders will be challenged to significantly reduce GHG emissions, forcing strategic choices, many of which will need to be made well before 2030, on low- to zero-carbon fuels and technologies to meet the IMO goals for 2050. By 2030, digitalization will have impacted all activities in the industry – but not equally. Waterborne cargo transport will be increasingly integrated into digital supply chains; whereas for other waterborne segments, like offshore services and cruise, the challenge (and opportunity) is to master the digital complexity of assets. Technologies that stand out as game changers are:
- fuels and associated technologies to reduce carbon emissions;
- additive manufacturing;
- digitized shipping;
- and safety of cyber-physical systems.
With the IMO having set out an ambitious target for shipping emissions in 2050, the industry is struggling to identify the right combination of measures to deliver the required emission reduction.
The IMO’s strategy to reduce GHG emissions by 50% by 2050 (compared to 2008) presents a massive challenge to a world fleet that will expand significantly by 2050. Given the longevity of vessels, drastic emission reduction measures must already be made on a ship-by-ship basis in the coming decade. How can this be achieved?
A twin-track approach is needed: minimizing the energy required by ships, and reducing the carbon emissions linked to the energy used. Achieving this requires measures related to regulation, commercial contracts, logistics and technology. Our focus here is on technology, accepting that the other measures are enablers of technology.
Technologies for minimizing the energy required range from those that reduce drag, such as air lubrication, to energy-efficiency measures such as battery hybrid power systems.
Uptake has been hampered by high costs and long paybacks, as well as a lack of standards for verifying the effects of such measures. Initiatives to ensure their rapid deployment are clearly urgent. However, our projections1 show that even if all cost-effective operational measures and technologies are deployed for all ships, there is still a significant gap to close to reach the IMO emission targets. This gap must be closed by using energy carriers with a low or zero emission footprint.
Utilizing clean electricity from shore by storing the energy in batteries for pure electric operation has been tested and implemented in short-sea applications. However, due to the low energy density of current battery technologies, this solution is only viable for ships operating over small distances, allowing for frequent charging of the batteries, and a large growth in the adoption of fully battery-electric ships for applicable trades in the coming decade.
Developments in battery technologies promise to expand the range of such applications, but it is not expected that these developments will make battery power a viable solution by 2030 for the propulsion of large, deep-sea ships, that account for the majority of emissions.
The limitations of fully-electric solutions are driving the search for alternative zero-emission technologies like hydrogen, ammonia, synthetic fuels and biofuel. However, uptake is currently hampered by limited availability and infrastructure, low energy density, safety issues and, most importantly, by high capital and operational costs.
Biofuels apart, we therefore see a very limited uptake of these fuels before 2030. However, zero-emission fuels will have to become to become a significant part of the fuel mix after 2030 if the IMO’s target is to be met. We therefore expect substantial investment in alternative fuel technologies, and changes in regulations to reduce barriers to implementation, in the next decade.
Meanwhile, there is an urgent need to implement fuels with a reduced GHG footprint, such as LNG and LPG, as these represent a cost-effective alternative today over the lifetime of the ship, provided methane emissions are minimized. Combining these fuels with energyefficiency measures may lead to GHG reductions in excess of 30% by 2030.
A strategy is needed for considering how a switch to carbon neutral fuels can be made as cost effectively as possible. Pathways, like those illustrated here, should ideally involve energy storage and conversion systems that can flexibly accommodate both fossilbased and renewable fuels, or that require a minimal degree of retrofitting.
Additive manufacturing promises tailor-made products on demand, but locating production closer to consumers may reduce demand for shipping.
Robotic assembly combined with additive manufacturing (3D printing) will usher in step-changes in efficiency and performance for many manufacturing industries in the long term. In a shorter time frame, the global market for 3D printing and services is expected to grow from USD 15 billion in 2019 to almost USD 50 billion by 20252.
By one estimate, 85% of spare part suppliers will have incorporated 3D printing3. In the maritime industry, additive manufacturing is also expected to first aim at ship-system spare parts. The contours of a spare-parton-demand business model are already evident, with libraries of digital designs and ‘3D printing centres’ in major ports – promising reduced storage needs, quick replacement of parts, and less downtime of ships. The traditional spare part supply chain will be completely remodelled.
Towards 2030, we expect that non-safety-critical ship spare parts will be additively manufactured in larger volumes and that 3D-printing centres will become standard. For safety-critical parts, often metal-based, progress depends on advances in quality assurance and testing, currently the subject of ongoing joint industry projects.
Already in 2019, the first metal parts for the maritime industry have been printed and development is quickly moving towards more complex parts and repair. The first manufacturers have become certified. In parallel, shipboard additive manufacturing is starting to attract attention. While this carries benefits, especially for operations in remote locations, it needs to be matched by new rules and assurance regimes.
Additive manufacturing introduces new risks: defective, non-original spare parts may increase risk of downtime and impact warranties, while freelance copying of product designs may discourage original suppliers from investing in new product development. However, there are new opportunities in both new quality-assurance routines and in IPR protection through digital rights management to limit the number of copies made. New methods are also being explored to uniquely label a part by embedding a QR-code, invisible from the outside but detectable with a suitable scanner4. This could permanently link the physical product to its digital identity, and it would be very hard to manipulate.
Additive manufacturing – as well as robotic assembly – brings products closer to the source of need. The many advantages associated with this include making supply chains more robust against extreme weather impacts, and reducing the GHG emissions involved in transport ing parts over often long distances. 3D printing also wastes less material as it involves building up products layer by layer, rather than the traditional manufacturing method of removing material from, say, a block of metal.
Although current additive manufacturing volumes are small (estimated at 0.1% of global manufacturing nominal contribution to GDP of USD 13.77 trillion in 2019), demand for waterborne transport of (semi-) manufactured parts might be reduced in the longer term and could impact container shipping volumes. A recent preliminary study5 estimates that this could result in a 10% reduction in shipping volumes by 2040, with a range of impact between 5% and 20% by 2045.
As we advance towards 2030, lower-cost sensors and connectivity will enable more than improved handling of ship performance and monitoring onshore. Augmentation of data from other sources enables ships to become integrated and synchronized parts of the entire logistics chain.
The most prominent digital transformation trend in the maritime industry is the establishment by fleet owners of their own onshore control and operation centres. There are different justifications for this, but cost reduction is the most evident.
We can envisage a diversification of responsibilities, with ship monitoring and even operation from onshore centres, enabled by high-speed communication networks. These could be manned and operated by owners, management companies and system suppliers – thus challenging existing business models.
At the same time, cargo owners are demanding more data on cargo condition, location and carbon footprint in order to optimize the management of their own operations and selection of chartered tonnage. In response, start-ups (for example Flexport and Xeneta) are offering easy-to-access cargo platforms, enabling comparison of transport services and prices. The resultant disruption to traditional logistics service providers, freight forwarders and integrated container liner shipping companies is expected to continue.
Onshore control and operation centres will need access to data from different sources ranging from sensor data to free text files. Many different players, including some new to the industry, can provide collection, transfer and analysis of such data. Towards 2030, we expect cost considerations to lead to fewer providers and significant standardization efforts.
Cost and safety ambitions will also lead to an expansion of autonomous operations, currently in their infancy, towards 2030 and beyond. The ultimate phase of this development, likely only after 2030, is fully autonomous ships. The first such projects are driven by cargo owners, looking for a technology that can deliver a service as part of their operations or logistics chains. The question is: Who will have the responsibility for manufacturing and operating these technologies? An autonomous system should ideally be able to operate itself, and new operational and ownership models and regulations supporting this trend are likely to emerge before 2030.
On a more distant horizon, a future business model might be servitization, where the system vendor in its most extreme case will have the responsibility for owning, monitoring, maintaining and operating the ship.
How can the maritime industry prepare for the emerging risk to life, property and the environment coming from increasingly complex, software-controlled ships?
While complexity in traditional mechanical systems is naturally limited by physical constraints and the laws of nature, complexity in integrated, software-driven systems – which do not follow any laws of nature or even well-established engineering principles – easily exceeds human comprehension.
Recent fatal accidents involving aircraft and self-driving cars have been caused by faults in such complex software systems. Analysis consistently shows a combination of human, technical and organizational failures behind such catastrophic accidents. In reality, a rapidly increasing number of ship functions are already being elevated to higher levels of autonomy, including decision support and highly automated machinery systems, leading to a dilution of responsibilities, systems that are not well understood, and associated new risks in the interfaces between man and machine.
A key challenge is that, for a typical ship, responsibility for the integrated software systems is distributed across a host of system vendors and sub-suppliers, without a strong system integrator as typically seen in other industries such as automotive and aerospace. Without a holistic systems perspective, it is invariably difficult to manage the design, construction, operation and maintenance of a software-controlled ship. There are no shortcuts available to solve this. For the maritime industry to significantly reduce software risk, new ways of working with systems and software are needed.
A new car is said to execute 100 million lines of software code6 across its digital elements from various suppliers. This indicates the magnitude of the challenge at hand also in the maritime industry, where digital risks arise from sensor systems, onboard communication networks, control systems including various algorithms, and humanmachine interaction. The biggest challenge, however, is managing the emergent properties in complex systems, which cannot be deduced from analysing the system parts in isolation, but only appear at a system level. Safety is one such emergent property.
How then, to assess these complex systems? Traditional risk analysis methods commonly used today were never designed for this, and therefore fail to provide trustworthy results. More recent methods, based on systems like STPA7, are more suitable, but not yet in common use. One key takeaway is the fact that emergent system properties cannot be deduced; they must be observed, either in actual operation of the real system or in an appropriate system simulation. For all practical purposes, this means that simulation at a system level is key to safety assurance of complex systems.
In other industries, simulator-based testing techniques are systematically used for this purpose. The use of HIL testing for safety- and operational critical control systems is now at the core of the Open Simulation Platform8 initiative. Control system software can be deployed in a simulated environment with test scenarios including defined events such as simulated failures. This approach can be used both in the building phase for virtual system integration and commissioning, and in the operational phase for checking software updates prior to on-board deployment.
Risk-based approaches to ship design, operation and regulation were at the forefront of the development a decade ago. In that period, the first ship-type specific formal safety assessments were made and submitted to IMO, documenting for the first time the risk level which in all cases was considered to be tolerable if made ALARP (as low as reasonably possible). Notably, system complexity did not feature in those assessments.
Since that time, few advances have been made, leaving the maritime industry without a formal method and without a toolset to rationally include system complexity into the overall risk picture.
Concerted industry action is now needed to manage the emerging digital risks. We need:
- a new and deep understanding of system safety to recognize the changed risk picture, mainly resulting from software and associated increased system complexity
- deep insight into how human, organizational and technical risk contribute to overall risk
- to communicate the new risk picture and associated preventive measures to regulators.
Following these three steps collaboratively will ensure that maritime’s risk-management toolbox will be re-equipped for the digital age.
- DNV GL (2019) Maritime forecast. Energy Transition Outlook to 2050.
- Wagner, I (2019) Additive Manufacturing and 3D Printing - Statistics & Facts. Statisa Report.
- PWC (2017) The future of spare parts is 3D: A look at the challenges and opportunities of 3D printing. Report by Geissbauer. R, Wunderlin, J & Dr. Jorge Lehr, J.
- Chen et al. (2019) ‘Embedding Tracking Codes in Additive Manufactured Parts for Product Authentication.’ Advanced Engineering Materials 21, 1800495.
- Pers. Comm. Professor Goh Puay Guan, University of Singapore (20.11.2019), see also Seatrade – Maritime News ‘Impact of 3D printing on shipping volumes visible from 2030: Singapore research’ 9 October 2019.
- Rystad Energy (2018) ‘Risk assessment and impact on technology decisions’ OG21.
- https://www.h21.green/ and http://www.koreaherald.com/view.php?ud=20191010000806
- DNV GL (2019) Hydrogen as an energy carrier. Position Paper.