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MARITIME

FORECAST TO 2050
Energy Transition Outlook 2017

SAFER, SMARTER, GREENER


dnv gl energy transition outlook – maritime

foreword

There are two areas that underpin the global economy as we know
it – energy and shipping. Energy, which determines how we power
the industries that create the goods and services of the modern
world, and shipping that allows us to move both the raw material
and the finished products to where we need them.

To obtain a clear and balanced view of the energy future for


both our customers and ourselves, we created the Energy
Transition Outlook (ETO), which models the energy transition
through to 2050. For our Maritime Energy Transition Outlook,
we take this model and project it onto the maritime industry of
today. Taking into account the uncertainties of looking into the
future, we ask: how will the expected shifts in energy production
and demand, change the maritime industry? And what might be
the impact on individual ship segments?

The Maritime ETO projects that heading to 2030, our industry will
continue with solid growth. Moving from 2030 to 2050, however,
our model suggests that demand for shipping is likely to increase
at a less rapid pace – with the growth primarily in non-energy
knut ørbeck-nilssen commodities, such as the container trade and non-coal bulk.
ceo of dnv gl – maritime Overall, shipping growth is likely to be focused in Asia and the
Indian Ocean regions, which continues recent trends.

One striking result of our


Maritime ETO is how we
can see the trends of today
become the paradigms
of tomorrow.

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foreword

One striking result of our Maritime ETO is how we can see the Because of the long lifespan of a maritime asset, this means that
trends of today become the paradigms of tomorrow. Shipping sooner rather than later, the industry will have to look to creating
will continue its drive for greater efficiency by reducing costs, vessels and a global fleet that are “carbon robust”.
improving utilization, lowering fuel consumption, increasing
vessel size, and deploying new technologies. The current wave A “carbon-robust” asset is one that can remain competitive under
of digitalization transforming the industry will also have a profound shifting energy, weather, demand, and regulatory scenarios.
impact – advancing design and operation, and creating new Well designed and operated, it will have a lower operating and
business models. lifecycle cost than other vessels on the market. As part of the
Maritime ETO, we have worked to define a framework that could
The fuel mix that we see beginning to shift today, will be help maritime stakeholders enhance the carbon robustness of
much more diverse in 2050. Oil will no longer be the overwhelming their vessels and fleet.
choice for trading vessels. Natural gas will step up to become the
second-most widely used fuel, with a third of the world’s fleet, The main ETO forecasts an energy landscape that, while familiar,
and new low-carbon alternatives will proliferate, supplying nearly has undergone significant changes. These changes will have
a quarter of the fleet. a deep impact on the shipping industry. And we hope that our
new Maritime ETO will offer stakeholders a set of interesting and
The continuing pressure to reduce emissions to air and the useful insights as they look ahead and make their plans for
growing drive toward decarbonization, shapes the fleet of 2050 the future of the industry.
in important ways, particularly in the choice of fuels.

knut ørbeck-nilssen
ceo of dnv gl – maritime

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dnv gl energy transition outlook – maritime

acknowledgements

This report has been prepared by DNV GL as a cross


disciplinary exercise between DNV GL’s Maritime
business area and a core research team in our central
R&D unit:

DNV GL – Maritime
Øyvind Endresen, Tore Longva, Alvar Mjelde,
Jakub Walenkiewicz, Gjermund Gravir, Trond Hodne,
Helge Hermundsgård, Terje Sverud, Catrine Vestereng,
Håkon Hustad

DNV GL – Group Technology and Research:


Sverre Alvik, Bent Erik Bakken, Christos Chryssakis,
Onur Özgün, Caroline Brun Ellefsen, Anne Louise
Koefoed

DNV GL – Business Assurance


Lars Erik Mangset

DNV GL – Maritime Communications


Simon Adams, Jeannette Schäfer.

4
contents

1 executive summary 6
2 introduction 14
3 past and present shipping 18
4 the energy transistion: 30
implications for maritime transport
5 the energy transistion: 50
implications for world fleet
6 key issues to monitor 64
7 the carbon-robust ship 72
8 references 78

5
1
EXECUTIVE
SUMMARY
dnv gl energy transition outlook – maritime

1. executive summary

The world energy system undergoes a major transition


towards 2050 and this will have significant implications
for shipping. Overall the demand for seaborne transport
will increase with 60% by 2050, with the pace of growth being
highest up to 2030, and with notable differences between
the various shipping segments.

This publication is one part of DNV GL’s new suite of Seaborne transport accounts today for almost 90% of
Energy Transition Outlook (ETO) reports covering 10 international trade, as measured by tonne-miles.
global regions. Here, we describe consequences of the
energy transition for the maritime industry, looking at The world fleet currently consumes about 250 million
goods to be transported within and between regions, tonnes of oil equivalent (Mtoe) of marine fuel. The
and the types of vessels needed. cargo-carrying fleet accounts for almost 90% of this.
Deep sea cargo-carrying ships dominate transport
We include transport of energy sources such as work and fuel consumption. Four-fifths (81%) of ship
crude oil, oil products, gas, and coal. We also traffic is located in the northern hemisphere.
provide forecasts for the following ship segments: More than 60% of the traffic is in the Indian and Pacific
containerized cargo, bulk, and other cargo. The Oceans, highlighting the importance of Asian trade.
outlook for offshore service ships is also discussed.
trade towards 2050
Trends and drivers factored into our long-term We forecast that trade measured as tonne-miles will
projections are outlined in the integrated approach to experience 2.2% annual growth over the period 2015–
forecasting illustrated below. As we look towards 2030 and 0.6% per year thereafter, driven mostly by
2050, we also elaborate on carbon risks from non-energy commodities, as illustrated in Figure 1.2.
a shipowner's perspective. Trade in individual energy commodities will decline as
their use declines: coal first, then crude oil, thereafter
past and present shipping oil products. Despite projected growth in oil imports
Over recent decades, the maritime industry has in some regions, global seaborne crude oil and oil
experienced steep growth in global demand for products, trade will reach peak volumes before 2030.
seaborne transport, with a corresponding increase in Natural gas – as liquefied natural gas (LNG) and liquid
the world fleet and its carbon dioxide (CO2) emissions. petroleum gas (LPG) – will experience sustained

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chapter 1 | executive summary

figure 1.1 energy transition outlook integrated forecasting

baseline studies transport demand world fleet


outlook towards 2050 outlook towards 2050

- Current world fleet - Transport demand - Supply of ships per


per commoditiy main segment
- Transport work carried out
- Demand per region - Energy mix and emissions
- Energy mix and emissions
- Change in trade patterns

growth, as gas takes over as the largest energy source. will lead eventually to less offshore-related shipping
Global gas consumption will decline after 2035, activity, though fast growth in offshore wind will partly
but growth in seaborne gas trade will be sustained mitigate the reduction.
as demand shifts to areas with less domestic gas and
many new sources of unconventional gas are not Geographically, seaborne trade growth will be
connectable by pipelines. strongest in the Asian regions. Our analysis provides
better regional insights for energy commodities than
Container growth is solid, closely following GDP for non-energy trade. We expect gas, non-coal bulk,
growth. The trade will experience the strongest growth and container trades to grow across most regions,
of all segments, as measured by tonne-miles; 3.2%/ with above-average growth rates in China, the Indian
yr on average to 2030, driven by strong demand for Subcontinent, South East Asia, and Sub-Saharan
consumer goods and continued containerization. It will Africa. Longer term, we see the level of oil exports
thereafter decline to average 2.1%/yr. Over the entire from the Middle East being maintained, but declining
forecasting period to 2050, annual growth will average in most other regions. Coal trade will reduce across
2.6% for container tonne-miles and 2.4% for global all regions after 2030.
GDP; so, the container trade multiplier (trade growth
relative to GDP growth) will average 1.1. world fleet towards 2050
The global cargo fleet will track the changes in trade
Bulk transport will continue to grow, but with notable volumes, as illustrated in Figure 1.3, but digitalization
cargo differences. Bulk commodities will see average and improved utilization mean that the fleet will grow
growth of 1.8%/yr in tonne-miles to 2030, and 0.6%/yr somewhat more slowly than trade. Measured by
thereafter, driven by strong increases in grain, deadweight tonnage (DWT), the crude oil fleet will
moderate rises in ore and other minor bulk, and a decline by approximately 20% by 2050, with the
decline in coal. We predict that declining offshore oil decline beginning after 2030. The product tankers
and gas activity, and decreasing initiation of new fields, fleet remains stable. The bulk segment »

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dnv gl energy transition outlook – maritime

figure 1.2 world seaborne trade: tonne-miles

Units: Trillion tonne-miles per year Cargo type

90
Other cargo
Container
80
Bulk
70 Natural gas
Oil products
60 Crude oil

50

40

30

20

10

1980 1990 2000 2010 2020 2030 2040 2050

Source: forecast - DNV GL; historical data - Clarkson Research, 2017

experiences a moderate growth of about 50%. emissions to decline by a quarter from 800 million
The greatest increase comes in the container and tonnes (Mt) today to near 600 Mt in 2050. The carbon
gas segments where fleet tonnage rises almost 150% efficiency per tonne-mile will improve by 51% between
to mid-century, responding to increased trade. 2015 and 2050. Still, carbon emissions elsewhere will
For other cargo vessels, we project a doubling decline faster; so, shipping’s share of overall energy-
of tonnage by 2050. related CO2 emissions grows from 2.6% to 3.5% over
the forecast period.
Looking at fleets’ fuel mix, oil use will decline: by
2050, only 47% of energy for shipping will be from key issues to monitor
oil-based fuels. The share of gas in the fuel mix will rise We model long-term trends towards 2050 and do not
to 32%. More than a fifth will be provided by carbon- factor in or attempt to predict short-term dynamics,
neutral energy sources, such as biofuel and electricity. such as rates, overcapacity, or short-term policy
Improved energy efficiency due to technical and changes. Developments over the next five years are
operational improvement (including speed reduction) important for understanding longer-term dynamics,
will see fuel use per tonne-mile reduce by 35–40% so the report describes some key issues to watch in
over the forecast period, with the largest reductions various shipping segments in the shorter term.
coming in the segments container, natural gas and
other cargo. Energy use for international shipping
will increase from 10.7 EJ in 2015 to 12.0 EJ in 2050,
while decarbonization of the fuel mix will help the CO2

10
chapter 1 | executive summary

We also discuss three potential game-changers major shifts in transport demand


that could affect our forecast: Additive manufacturing (3D printing), robotization,
and automation could enable relocation of production
decarbonization and back to developed countries, thereby shortening
environmental awareness global value chains and potentially reducing demand
Decarbonization will challenge the way ships are for seaborne transport. There is also rising interest in,
designed and operated. Several developments with and action to establish, circular economies to reduce
potentially great impact, but involving high uncertainty, consumption of virgin materials and waste generation,
could influence technology uptake and our future trends that can shift and reduce transport demand.
fleet projections. The need for Greenhouse gas (GHG) In addition, China’s OBOR (One Belt and One Road)
emissions reduction drives energy efficiency and the initiative, which aims to reshape intercontinental trade
development and use of alternative fuels. Fleet-growth through a new network of maritime and landside links
assumptions may be challenged by future regulations, between Africa, Asia, and Europe, is a potential game-
requiring significant investment to ensure compliance. changer for the shipping industry. It could work »

figure 1.3 fleet development 2015-2050 by segment

Units: Million DWT Segment

3 000 Non-cargo
Other cargo
Container
2 500 Bulk
Natural gas
Oil products
2 000 Crude oil

1 500

1 000

500

0
2015 2020 2025 2030 2035 2040 2045 2050

Source: DNV GL

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dnv gl energy transition outlook – maritime

in both directions: rail and road transport might


capture market share from shipping, but trade growth
could also favour the latter.

digitalization and innovation


Digitalization can change current business models
and how ships are operated, which may impact on their
energy use. Phasing in autonomous ships opens the
way for very low speeds without incurring high crew
costs, and greater use of batteries and alternative fuels.
The results are reduced energy demand, fuel use,
and emissions.

the carbon-robust ship


Based on our forecast of the most likely energy future,
the world fails to achieve the Paris Agreement’s target
of limiting average global warming to well below 2°C
above pre-industrial levels. Securing a 2°C future will
not be achieved without a steeper reduction in the use,
and hence transport, of fossil fuels. A low-carbon future
would also require more energy-efficient ship designs
and operations, and carbon-neutral fuels. Future
regulations and stakeholder expectations might imply
significant investments to upgrade and renew ships.

Companies need to prepare for and mitigate


carbon-related risk. Here, we introduce the concept
of ‘the carbon-robust ship’ and describe a three-
step approach to evaluate and improve the carbon
robustness of vessels and fleets. The approach
stress-tests how well a ship, fleet, and company will
perform under different energy transition scenarios. 

A low-carbon future
would also require more
energy-efficient ship
designs and operations,
and carbon-neutral fuels.

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chapter 1 | executive summary

13
2
INTRODUCTION
dnv gl energy transition outlook – maritime

2. introduction

A global transition towards greater use of renewable energy


and less use of fossil fuels is underway and will progress
towards mid-century. The consequent changes will impact
all players in the maritime sector.

Driven by our purpose of safeguarding life, property, to the maritime, oil and gas, and the power and
and the environment, DNV GL enables organizations renewable energy industries. We also provide
to advance the safety and sustainability of their certification services across many industries.
businesses. Around 70% of our business is energy-
related in one form or another. As a leading player in the industry, DNV GL routinely
publishes maritime outlooks such as Technology
We provide classification, technical assurance, Outlook 2025, Shipping 2020, and low carbon
software, and independent expert advisory services pathways studies. The company shares its analyses

Around 70% of our


business is energy-related
in one form or another.
16
chapter 2 | introduction

of supply and demand trends with stakeholders sectors such as buildings, manufacturing,
and customers. This latest publication provides an and transportation (air, maritime, rail and road).
independent forecast of the maritime energy future Some key predicted regional trends and analyses are
and examines how the transition will affect the industry. discussed, and more detailed analysis is available
from DNV GL. We can also tailor such content to the
This publication is one part of DNV GL’s new suite needs of individual organizations and companies.
of Energy Transition Outlook (ETO) reports.
Alongside a main outlook, the suite includes three We stress that our model presents the ‘most likely’
separate reports discussing implications for maritime, future, not a collection of scenarios. The coming
oil and gas, and power and renewables industries. decades to 2050 hold significant uncertainties:
In all cases, we provide predictions through to 2050 future energy policies; human behaviour and reaction
for the entire world energy system. to policies; the pace of technological progress;
and pricing trends for existing and new technologies.
Here, we describe consequences of the energy Comprehensive analysis of sensitivities related
transition outlook for the maritime industry, looking to our modelling is available in the main report
at goods to be transported, and the types of vessels (DNV GL, 2017a).
needed. We include transport of energy sources
such as crude oil, oil products, gas and coal. We also
provide forecasts for other bulk, containerized cargo,
and other cargo types.

All our outlooks are based on DNV GL’s independent


ETO model that tracks and forecasts regional energy
demand and supply, and energy transport, for 10
global regions. On the demand side, it analyses key

17
3
PAST AND
PRESENT
SHIPPING
3.1 historical developments 21
and shifts in shipping
3.2 characteristics of 23
the world fleet 25
3.3 traffic patterns for
the main ship types
3.4 traffic patterns by ship size 29
dnv gl energy transition outlook – maritime

3. past and present shipping

This section highlights some main developments and


changes for shipping in recent decades. It also outlines the
current global trading picture for shipping, based on global
AIS (Automatic Identification System) tracking, reflecting main
trading routes. The key question of how global trade and
the world fleet will develop towards 2050 is addressed
in sections 4 and 5 of this report.

There has been rapid growth in global demand The slowdown in growth in 2015–2016 is a good example
for seaborne transport over recent decades, with of China's impact on the market, as it was attributed
corresponding increases in the world fleet and CO2 mainly to weaker Chinese economic growth and reduced
emissions. China heavily influenced transport market raw material imports as the country transitioned from an
dynamics as its imports of dry bulk increased nearly industrial to a service-oriented economy.
sevenfold in volume over 2000–2015 (UNCTAD, 2016).

20
chapter 3 | past and present shipping

3.1 historical developments


and shifts in shipping

Seaborne transport accounts today for almost 90% of 1965, for example. The operational and technological
international trade as measured by tonne-miles, more characteristics of specialized vessels have improved
than tripling since 1980 (Table 3.1). Expansion of the logistics efficiency, with related reductions in energy use
world fleet has been slightly lower, reflecting improved and emissions. Switching fuels for existing engines can
fleet productivity. Trade in all main commodities typically be achieved more swiftly than implementing
increased between 1980 and 2015. The largest new main engines. Moving towards 2050, increased
relative growth was in containers, followed by LNG, uptake of alternative fuels and innovative propulsion
coal, and iron ore (Figure 3.1). In 2016, 70% of the total technologies is expected, as outlined in Section 5.
international seabourne trade, in terms of tonnes of
cargo loaded, was carried by dry cargo vessels, with Excluding fishing vessels, the merchant world fleet
oil and gas tankers making up the remaining 30% consists of about 87,000 ships of greater than 100 gross
(UNCTAD, 2017). tonnage (GT), of which cargo-carrying ships account for
roughly 60% by number1. The other 40% is employed in
Recessions in the 1980s and 2000s resulted in idle activities such as offshore service and supply, passenger
tonnage and lower productivity. Shorter-term business transport, and general services – towage or surveying,
cycles will inevitably have an impact on shipping in the for example. These ships are, on average, far smaller than
future as well, but have not been included in our model cargo-carriers. The future development of the world
based on longer-term trade dynamics until 2050. fleet is discussed in Section 5.

More efficient and specialized ships have penetrated


the market; the first deep sea cellular container ship in

table 3.1 world seaborne trade

1980 1990 2000 2010 2015

Cargo transported (million tonnes) 3 700 4 000 6 000 8 400 10 830


Trade in cargo (billion tonne-miles) 16 800 17 100 23 000 44 400 53 330
Cargo fleet size (million DWT) 670 630 790 1 280 1 750

DWT = deadweight tonnage


Source: UNCTAD, Clarkson Research

21
dnv gl energy transition outlook – maritime

Units: Billion tonnes/yr Units: Million DWT Cargo type

Moving towards 2050,


increased uptake
of alternative fuels and
innovative propulsion
technologies is expected.

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chapter 3 | past and present shipping

3.2 characteristics of
the world fleet

DNV GL’s detailed analysis of global ship traffic uses The other 15 % is used by fishing and domestic
ship movement data from the Automatic Identification shipping (Smith et al., 2014). A separate AIS analyses,
System (AIS), mandatory for ships of 300 GT and indicates that about 15% of marine fuel consumption
upwards engaged on international voyages, and for all for the world fleet occurs under port stays, anchorage,
cargo ships of 500 GT or more. Small vessels without an and when ships operate at very low speed, below
AIS are not included in this study. one knot (kn). There is wide variation between
different ship types.
Table 3.2 presents AIS-based calculations of key
performance characteristics for the world cargo fleet In Figure 3.2, ships’ fuel consumption is charted to
and vessel types in 2016. Bulk vessels dominate by the reflect global trading patterns and routes in 2016.
number of nautical miles (nm) sailed, while container The distribution of such consumption is presented
vessels are the largest fuel consumers. on a global grid of 0.1 by 0.1 degree latitude and
longitude. Our result shows that 81% of marine fuel
The AIS-based modelling of 2016 ship traffic indicates consumption is in the Northern hemisphere (Table 3.3).
that the world fleet consumes about 250 million tonnes International traffic dominates, though some national
of oil equivalent (Mtoe) of marine fuel; the cargo- traffic is included.
carrying fleet accounts for 89% of the total. These
numbers are based on ships with AIS-transponders Simpler worldwide traffic distributions are available
and cover national and international traffic. According for year 2000 (Endresen et al 2003; OECD 2010). While
to the third International Maritime Organization (IMO) nearly doubling the transport work from 2000 to 2016,
greenhouse gas (GHG) study, international traffic traffic patterns seem largely to persist, though some
accounts for some 85 % of total fuel consumption. changes emerge. The Indian and Pacific Ocean trades »

table 3.2 ais-based analysis of world cargo fleet in 2016

Variable Bulk vessels Oil tankers Container vessels Other cargo vessels* TOTAL

Number of vessels 11 844 6 532 5 383 19 824 43 583


Sailed distance (million nm) 529 211 372 726 1 838
Share of maritime fuel consumption 23% 16% 26% 24% 89%

Source: DNV GL
*Chemical/product tankers, gas tankers, general cargo vessels, RoRo and refrigerated cargo vessels – in descending order ranked by amount of fuel consumed

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dnv gl energy transition outlook – maritime

All vessel types

-6

Note: 10-6 % of the fuel consumption (per 0.1° by 0.1° grid cell)
Source: DNV GL

show traffic growth, while there is a significant relative


reduction in intercontinental traffic in the North Atlantic.
More than 60% of 2016 traffic is in Indian and Pacific
waters, highlighting the importance of Asian trade.
UNCTAD (2017) reports that Asia is the main importing
and exporting region, accounting for 61% of unloaded
cargo and 40% of loaded cargo in 2016. Developing
economies are key players in supply of raw materials,
but also growing sources of consumption import
demand. In 2016, developing economies accounted
for 6% of unloaded cargo and 59% of loaded (UNCTAD,
2017).

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chapter 3 | past and present shipping

3.3 traffic patterns


for the main ship types

The global distribution of main cargo ship types shows The dominant transport routes are seen in Figure 3.3,
large variation in traffic patterns, reflecting differences with the busiest ports in Asia, Europe, and the US.
in transport of oils, imports of raw materials for
manufacturing industries, and trade in manufactured These trends will not continue throughout the period
products (Table 3.3). to 2050 as coal trade declines sharply, gas trade erupts
in new locations, and oil trade grows initially before
Compared with container ships and oil tankers, entering long-term decline as discussed in Section 4
bulk vessels have around twice as much of their traffic of this report. New sea routes will emerge, with
in the Southern hemisphere. Nearly half (45%) of bulk changing trade patterns for deep sea and coastal
and container ship traffic is in the Pacific, but only 30% shipping. 
of oil tanker traffic.

table 3.3 share of total fuel consumption by ship type and hemisphere

World fleet Bulk vessels Oil tankers Container vessels

North South North South North South North South


Atlantic Sea 24% 6% 15% 11% 22% 6% 19% 4%
Indian Ocean 16% 8% 10% 16% 27% 7% 19% 5%
Mediterranean Sea 9% - 4% - 7% - 8% -
Pacific Ocean 32% 5% 36% 8% 28% 3% 41% 4%

Segment totals 81 % 19% 65 % 35% 84% 16% 87% 13%

Source: DNV GL

25
dnv gl energy transition outlook – maritime

All vessel types

Oil tankers

Source: DNV GL

26
chapter 3 | past and present shipping

Bulk vessels

Container vessels

27
dnv gl energy transition outlook – maritime

Short sea shipping: tankers < 25,000 GT

Deep sea shipping: tankers > 25,000 GT

Source: DNV GL

28
chapter 3 | past and present shipping

3.4 traffic patterns by ship size

The AIS-based modelling offers great potential for consumption. The short sea segment accounts
performing in-depth studies on ship type and size for 19% of fuel consumption and approximately 2%
categories. One example is for oil tankers, which of tonne-miles (total oil tanker). Half the fleet, measured
account for some 16% of total maritime fuel oil by vessel numbers, is consuming about 80% of the fuel
consumption (see Table 3.2). We have performed and delivering almost all tonne-miles.
detailed analysis of this segment, splitting results into
short sea and deep sea shipping, and differentiating Compared with the short sea segment, deep sea
between transport of crude oil and oil products. vessels have fewer options for reducing fuel and CO2
emissions (DNV GL, 2017b). When modelling future
It comes as no surprise that the larger ships, mainly fleet size and technology shifts in Section 5, results
above 25,000 GT, are deployed on long-haul routes are provided separately for short and deep sea.
(deep sea shipping), whereas the smaller ones operate
in intra-regional trade (short sea shipping). The ship
traffic by location and fuel used is shown in Figure 3.4.

Table 3.4 presents key performance characteristics Deep sea vessels have
for crude oil tankers and product tankers in 2016. The
deep-sea crude oil tankers dominate by transport
fewer options for reducing
work (91%), and account for 70% of total fuel oil fuel and CO2 emissions.

table 3.4 key data on oil tankers

Ship type and operational parameters Crude oil tankers Product tankers Total oil tankers

Short sea Deep sea Short sea Deep sea Short sea Deep sea
Percentage of vessels 2% 42% 48% 8% 50% 50%
Tonne-miles < 1% 91% 2% 7% 2% 98%
Fuel consumption 1% 70% 18% 11% 19% 81%

Source: DNV GL

29
4
THE ENERGY
TRANSITION:
IMPLICATIONS
FOR MARITIME
TRANSPORT

4.1 the eto model 33


4.2 trade towards 2050 38
dnv gl energy transition outlook – maritime

4. the energy transition:


implications for maritime
transport

Economic activity is the main driver of sea transport. Examples


include: transporting fossil fuels, raw materials for the manufacturing
industry, and manufactured products for final use. This section
provides an outlook for the maritime industry based on volumes to
be transported, and covers crude oil, oil products, gas, and bulk and
containerized cargo as well as an outlook for offshore service ships.

Our globally connected energy system model can


quantify the need for trade in commodities between
and within 10 regions, thus enabling trade forecasts
that reflect dynamics, such as growth in the fossil fuel
trade in the next decades, then its subsequent decline.
These dynamics are influenced by the energy transition
towards renewables, new production methods – such
as hydraulic fracturing – and changes in geographical
focus of fossil-fuel demand and supply. So far, our
literature survey has not found similar approaches
where shipping volume dynamics are included as an
integral part of the energy transition to 2050 (DNV GL,
2017a).

32
chapter 4 | implications for maritime transport

4.1 the eto model

Our ETO model, designed to forecast the energy


transition in 10 global regions (Figure 4.1), is a system
dynamics feedback model implemented with
The main drivers for the
Stella software and covering the energy system transition of the supply
from source to sink.»
is a decarbonization push.

figure 4.1 regions analyzed in the energy transition outlook

Region

North America (NAM)


Latin America (LAM)
Europe (EUR)
Sub-Saharan Africa (SSA)
Middle East
and North Africa (MEA)
North East Eurasia (NEE)
China (CHN)
Indian Subcontinent (IND)
South East Asia (SEA)
OECD Pacific (OPA)

33
dnv gl energy transition outlook – maritime

The main drivers of energy demand are increasing


GDP and improved energy efficiency restricting
demand growth (Figure 4.2). Key demand sectors
such as buildings, manufacturing, and transportation
(air, maritime, rail and road) are analyzed.

The main drivers for the transition of the supply


are a decarbonization push manifested as energy
policies favouring some energy carriers over others.
Technology learning curves and corresponding cost
developments are driving down costs of all energy
sources, while resource availability constraints might
drive up costs. Differences between these cost
developments help to determine the future energy
supply mix between and within fossil- and non-fossil
fuel categories. The outlook has a significant focus
on technology and quantifies uptake of new
energy technologies.

In the main ETO report (DNV GL, 2017a), we detail our


approach and resulting regional forecasts for energy
demand and supply. We forecast that global energy
demand stabilizes from 2030 at levels little higher than
now. Energy supply peaks around the same period,
and consumption of thermal fuels reduces, impacting
maritime transport of coal and oil.»

The outlook has a significant


focus on technology and
quantifies uptake of new
energy technologies.

34
chapter 4 | implications for maritime transport

figure 4.2 overview of the eto model

energy intensity gdp per capita population

demand

transport manufacturing buildings

road goods residential

aviation base materials commercial

maritime non-energy

rail

policy

exchange supply

trade volumes fuel extraction & refining

oil gas oil gas

bulk coal refineries

energy market power

power oil coal gas

coal gas nuclear renewables

Source: DNV GL

35
dnv gl energy transition outlook – maritime

seaborne trade
Fossil-fuel trade within and between regions is a Intra-regional trade is determined as a constant
major component of the forecast. Crude oil trade multiplier of regional gas demand.
is determined by regional differences between its
production and the respective demand for it. On Coal use is derived from sectors such as power,
the crude oil supply side, we model production manufacturing, buildings, and transport, with demand
capacity as a cost-driven global competition between for brown coal confined to its use for power. Each
regions and in three segments (offshore, onshore, region’s hard coal supply reflects its mining capacity,
and unconventional). Since crude transportation is which expands as demand increases and is limited by
typically less than 10 % of crude’s final cost, we use total its geologically available reserves. As in the case of
breakeven production cost to estimate the location natural gas, we assume a stable mix and shares of trade
and type of future oil production. The gap between partners for coal. Regions with domestic shortfalls
a region’s crude oil production and refinery input import coal from those which export.
determines the surplus for export or a deficit to be met
by imports, which is mainly transported on keel. The The model also tracks regional manufacturing
base assumption is that maritime crude trade flows of finished goods and the use of raw materials.
only one way, in or out of a region, with ballast moving It provides a baseline for non-energy commodity trade
in the opposite direction. The final seaborne crude oil on keel. Global minor bulk trade is correlated
trade also accounts for intra-regional trade, estimated with worldwide production of base materials such
as a fraction of regional oil demand. as metals, paper, steel, and wood, thus enabling us
to forecast global minor bulk trade. Iron ore trade is
We adopt a simpler approach for shipment of oil also driven by base material production, but uses a
products. Our oil products algorithm starts with inter- different trade multiplier than minor bulk. We have
regional trade, driven by total import needs of regions. no explicit agriculture sector, and thus assume that
This need is calculated from the difference between grain production dynamics will follow population
final oil products demand and refinery output. Intra- and GDP-per-capita growth of existing and potential
regional trade and additional demand due to biofuels grain-importing regions. Similarly, we define a
are accounted for using trade multipliers. relationship between container trade and the global
supply of manufactured goods. A similar relationship
To determine seaborne gas trade, we deduct the exists between manufactured goods, production and
current share of gas transported by pipelines. This other cargo trade, including shipping of dry cargo
reasoning is supported by historic data and trends in unaccounted for in other categories.
gas production. For gas in the form of LNG and LPG,
transportation cost, including piping, liquefaction, For most commodities, we estimate future distance of
and regasification, is a significant component of the cargo based on historic data and expected changes in
final consumer gas price to users. Consequently, we regional balances, and multiply the distance with the
model regional gas production differently from crude forecasted global trade volume to calculate tonne-
oil. Step one is to determine the fraction of gas demand miles. For natural gas and coal, we multiply each region
to be supplied from the region’s own sources. pair’s trade volume with a sailing distance estimated
This varies between regions due to geographic, by selecting two representative ports for each region
political, and economic differences, and over time. and taking a weighted average. Because this approach
Any shortfall in meeting demand from regional utilizes regional imports and exports, the effect of
production is allocated to exporting regions according new routes, such as North America emerging as a new
to their current shares as gas trading partners. exporter, is also reflected in tonne-miles. 

36
chapter 4 | implications for maritime transport

figure 4.3 model overview for the maritime sector

refineries

trade volumes tonne-miles


Oil products production

Crude oil Crude oil tankers

energy demand fuel extraction Oil products Oil products tankers

Oil demand Crude oil production Natural gas Gas carriers

Gas demand Natural gas production Coal Bulk carriers

Coal demand Coal production Non-coal bulk Container ships

Containers Other cargo vessels

Other cargo
manufacturing

Base materials

Manufactured goods

Source: DNV GL

37
dnv gl energy transition outlook – maritime

4.2 trade towards 2050

Our seaborne trade forecast for selected years is bulk, the combination of an increase in non-coal bulk
presented in Tables 4.1 and 4.2 and the bigger picture trade with eventual reductions in coal transportation
over the forecasting period 2015–2050 in Figures 4.4 implies sustained growth to 2050, when trade will be
and 4.5, along with a breakdown of cargo type. almost 40% higher than currently.

We forecast a 35% rise in seaborne trade to 2030 Variations in sailing distances explain the differences in
and an additional 12% growth thereafter. We project the relative scale of trade by cargo type seen in Tables
increased seaborne transportation for all trade 4.1 and 4.2. As a result, the growth in annual transport
segments except crude oil and oil products, which of goods in tonne-miles from 2015 to 2030 will be 38%,
peak around 2030 (Table 4.1). The largest relative slightly above the 35% projected growth in tonnes.
growth in transportation demand is seen for gas and Similarly, the tonne-miles growth from 2030 to 2050 will
container cargo, each increasing by 135-150%. For be 14%. 

table 4.1 world seaborne trade tonnage table 4.2 world seaborne trade tonne-miles

Cargo type Trade (million tonnes/yr) Cargo type Trade (billion tonne-miles/yr)
2015 2030 2040 2050 2015 2030 2040 2050

Crude Oil 1 870 2 250 1 990 1 540 Crude Oil 8 990 11 240 9 880 7 500
Oil Products 1 020 1 330 1 220 1 030 Oil Products 2 910 3 910 3 560 3 000
Natural Gas 330 640 700 770 Natural Gas 1 420 2 900 3 210 3 570
Bulk 4 820 6 080 6 330 6 640 Bulk 26 620 34 690 37 130 39 100
Container 1 660 2 660 3 390 4 040 Container 8 290 13 290 16 910 20 100
Other Cargo 1 120 1 650 1 940 2 260 Other Cargo 5 090 7 600 8 950 10 370

Total 10 830 14 600 15 570 16 290 Total 53 330 73 620 79 650 83 650

38
chapter 4 | implications for maritime transport

figure 4.4 world seaborne trade: tonnage

Units: Billion tonnes per year Cargo type

18 Other cargo
Container
16
Bulk
14 Natural gas
Oil products
12 Crude oil

10

1980 1990 2000 2010 2020 2030 2040 2050

Source: forecast - DNV GL; historical data - Clarkson Research, 2017

figure 4.5 world seaborne trade: tonne-miles

Units: Trillion tonne-miles per year Cargo type

90
Other cargo
Container
80
Bulk
70 Natural gas
Oil products
60 Crude oil

50

40

30

20

10

1980 1990 2000 2010 2020 2030 2040 2050

Source: forecast - DNV GL; historical data - Clarkson Research, 2017

39
dnv gl energy transition outlook – maritime

4.2.1 BULK

As we attempt to distinguish energy commodities Global seaborne coal trade is currently dominated
from all other cargoes, we analyse bulk trade as coal by hard coal imports to China, India, Japan, and
and non-coal. The latter includes grain, iron ore, Korea from Australia and Indonesia. We forecast
and minor bulk (Figure 4.6). Non-coal bulk is vastly current massive Chinese coal imports to decline
exceeding the coal trade, growing by 2.4%/yr to 2030 amid decarbonization of the country’s power and
and 1.0%/yr thereafter. We forecast growth in iron ore manufacturing sectors, which will allow indigenous
and minor bulk trade to slow down, especially after coal production to catch up with demand. The
2030, because of a reduction in world base material Indian Subcontinent will, by contrast, see sustained
output growth, which is itself driven by weaker GDP growth in coal consumption, but its production will
growth. Grain trade will also grow more slowly than also expand to enable self-sufficiency towards 2050.
recently, but growth will be sustained, reflecting GDP Decarbonization of power generation in Japan and
growth in developing regions. Korea will not gain enough momentum before 2030

figure 4.6 global seaborne bulk trade

Units: Billion tonne-miles per year

40 000

35 000

30 000

25 000

20 000

15 000

10 000

5 000

1980 1990 2000 2010 2020 2030 2040 2050

Source: forecast - DNV GL; historical data - Clarkson Research, 2017

40
chapter 4 | implications for maritime transport

figure 4.7 regional net crude oil imports

Units: Million tonnes per year Region

2 000 OPA
SEA
1 500 IND
CHN
1 000 NEE
MEA
500 SSA
EUR
LAM
0
NAM
0

-500

-1 000

-1 500

-2 000
1980 1990 2000 2010 2020 2030 2040 2050

Source: forecast - DNV GL; historical data — IEA, 2016

4.2.2 OIL

to bring down imports, which are their only source of With more than 90% of crude oil trade on keel,
coal. This will make intra-regional trade within OECD changing production and consumption patterns
Pacific the largest coal trade route in the world in impact seaborne trade directly. By 2030, as Europe
2030. and OECD Pacific reduce their oil consumption,
China will continue to be the largest importer of
After 2030, an accelerated widespread shift from coal crude, followed by the Indian Subcontinent. Exports
to alternatives will reduce its trade significantly. In will continue to come mainly from Middle East and
2050, the major importers will be the Middle East and North Africa, North East Eurasia, Latin America and
North Africa, which are almost completely dependent Sub-Saharan Africa (Figure 4.7). Later, North-American
on imports for coal, and some South East Asia exports become significant.
countries, such as the Philippines and Thailand, that
lack local coal resources. Middle East and North Africa With a fast-growing transport sector, oil use will
will meet coal demand through supplies from Latin increase towards 2030 in China, Latin America, and
America, North East Eurasia, South East Asia, and North East Eurasia. Thereafter, it will start to reduce,
Sub-Saharan Africa. Indonesia will remain the largest due in large part to electrification of the sector. This
national exporter of coal.  contrasts with the Indian Subcontinent, Middle East »

41
dnv gl energy transition outlook – maritime

and North Africa, Sub-Saharan Africa and South East declines and will drive exports from there, mainly to
Asia, where oil demand keeps increasing until 2040. Asian regions.
This delay in peak oil demand is caused partly by
slower electrification rates of vehicles in developing Currently, more than 85% of global seaborne crude
regions with less extensive power-grid infrastructure. oil trade is inter-regional, the remaining 15% being
Oil use for air transport will also grow, propelling within regions. Seaborne crude oil trade will plateau
the Indian Subcontinent into the top crude importer some 15% higher than now within the next decade,
position, leaving current leader China a close second. thereafter trending down after 2032 to reach around
By 2050, imports to these two regions will constitute 7.5 trillion tonne-miles in 2050 (as illustrated in
two-thirds of seaborne crude oil trade. West African Figure 4.8).
exports will vanish, as Sub-Saharan oil demand
increases to equal the region’s indigenous production Forecasting trade in oil products as a function of
level. regional refineries’ output and demand, we conclude it
will follow a similar pattern to crude oil trade, following
There will be interesting supply-side developments the levelling off and eventual decline of global oil
beyond 2040. Early signs of resource depletion demand. The seaborne oil products trade in terms of
in Middle East and North Africa will result in a 10% tonne-miles is around one third of the crude oil trade
reduction in the region’s oil exports from 2040–2050. in 2015, and the reduction will be a little less than for
The cost of shale oil in North America continuously crude oil, partly due to increased biofuel trade.

figure 4.8 global seaborne crude oil and oil products trade

Units: Billion tonne-miles per year

12 000

10 000

8 000
Crude oil

6 000

4 000

Oil products
2 000

1980 1990 2000 2010 2020 2030 2040 2050

Source: forecast - DNV GL; historical data - Clarkson Research, 2017

42
chapter 4 | implications for maritime transport

4.2.3 NATURAL GAS

Trade in natural gas (the sum of LNG and LPG), Driven by manufacturing sector growth, China’s rising
will continue to increase (Figure 4.9). need for natural gas sees it become the leading
gas importer by 2030. A manufacturing boom and
However, shifting demand and supply patterns will population growth drive Indian Subcontinent’s
change trade flows. This is illustrated in the map demand between 2030 and 2050. Regional
below (Figure 4.10), where the thickness of the lines production will not keep up with demand, making
represents trade volume in tonnes, although the paths Indian Subcontinent the largest gas importing region
do not represent detailed trade routes. The most in 2050. Sub-Saharan Africa becomes a net importer
salient feature is the stark increase in exports from of natural gas as its own cheap onshore and offshore
North America to China and Africa. resources are depleted after 2030.»

figure 4.9 global seaborne natural gas trade

Units: Billion tonne-miles per year

4 000

3 500

3 000

2 500

2 000

1 500

1 000

500

1980 1990 2000 2010 2020 2030 2040 2050

Source: forecast - DNV GL; historical data - Clarkson Research, 2017

43
dnv gl energy transition outlook – maritime

Most gas exports are currently through pipelines,


Russia to Europe being the prime example. This will
change, as inter-regional trade - particularly North
China’s rising need for
American exports - will grow towards 2050, when we natural gas sees it become
project the share of piped natural gas trade between
countries to decrease to less than 50%.
the leading gas importer
by 2030.
The position of Middle East and North Africa as the
largest exporter region will be rivalled by North
America as unconventional gas production there
expands. North America – together with smaller
contributions from Europe, Latin America, and Middle
East and North Africa – will supply Sub-Saharan
Africa’s new gas demand. Middle East and North
Africa will be the main source for meeting Indian
Subcontinent’s increased gas demand.

44
chapter 4 | implications for maritime transport

2015 Exporting Region

OPA
SEA
IND
CHN
NEE
MEA
SSA
EUR
LAM
NAM

2050

Source: DNV GL
Please note: while the thickness of the lines represents actual trade volume in tonnes, the connections shown do not represent particular trade routes.

45
dnv gl energy transition outlook – maritime

4.2.4 CONTAINERS

Container trade has grown strongly for decades, Container growth is projected for all regions, and
outpacing global seaborne trade because of an will be greatest in those with the largest growth in
ever-increasing containerization rate. As the share of manufactured output. We expect Indian Subcontinent
dry cargo being transported in containers overtakes to show the strongest growth, China to sustain
alternatives and reaches a natural limit, containerization substantial increases, and South East Asia and
growth will slow down. However, slower growth due Sub-Saharan Africa to outpace average growth,
to limits on increased containerization is offset by leading to a strong rise in Indian Ocean trade.
increasing trade in finished products. We forecast
container trade to increase by 3.2%/yr to 2030 and
2.1%/yr thereafter (Figure 4.11).

figure 4.11 global seaborne container trade

Units: Billion tonne-miles per year

20 000

15 000

10 000

5 000

1980 1990 2000 2010 2020 2030 2040 2050

Source: forecast - DNV GL; historical data - Clarkson Research, 2017

46
chapter 4 | implications for maritime transport

figure 4.12 global seaborne other cargo trade

Units: Billion tonne-miles per year

12 000

10 000

8 000

6 000

4 000

2 000

1980 1990 2000 2010 2020 2030 2040 2050

Source: forecast - DNV GL; historical data - Clarkson Research, 2017

4.2.5 OTHER CARGO

Other cargo is a category encompassing all types


not described above. It includes general cargo,
and chemicals carried on tankers and vessels. Parts of
Slower growth due
the other cargo segment will move to containers over to limits on increased
time. This is one main reason why the segment will see
annual growth rates decline towards 2050 (Figure 4.12):
containerization is offset
seaborne other cargo trade will increase 2.7%/yr by increasing trade in
on average until 2030, and 1.6%/yr thereafter. Our
analysis does not track geographical change in this
finished products.
trade, but we foresee a slow eastward shift in line with
growth of Asia’s share in the world economy.

47
dnv gl energy transition outlook – maritime

4.2.6 OFFSHORE SHIPPING

A significant amount of shipping activity relates to Offshore gas production will rise from the early 2020s
offshore activities. These are principally oil and gas to plateau around mid-decade before entering a
exploration, development, and production, although slow, sustained decline from the mid-2030s. Our
offshore wind, aquaculture, and other sectors also model focuses only on longer-term trends and
need shipping. developments. The shorter-term dynamics of year-on-
year changes are not reflected; so, some divergence
Our analysis forecasts offshore oil and offshore gas from actual data is to be expected.
production (DNV GL, 2017a; DNV GL, 2017e), providing
important input for predicting future activity levels of Changes in shipping activity are not directly
offshore shipping compared with a baseline year of proportionate to the scale of shifting patterns in either
2015 (Figure 4.13). offshore production or new offshore developments.
Factors such as distance to shore, geography, subsea
Figure 4.13 illustrates offshore oil and gas output over engineering activity, water depth, field complexity,
the forecast period and projects changes in production and the maturity of the field will also have an influence.
capacity – particularly related to capacity additions Still, we expect that offshore-shipping activity related
(new start-ups). Significant declines are forecast. to new oil and gas field developments will likely more

48
chapter 4 | implications for maritime transport

than halve over the forecast period. We also anticipate We predict that offshore wind energy generation
reduced shipping activity related to existing fields. will grow 200-fold over the forecast period (DNV GL,
Decommissioning of offshore oil and gas assets 2017f); more energy will come from offshore wind
will increase over the period, but not to an extent that than from offshore oil in 2050. Offshore wind requires
will compensate for reduced activity in new significant shipping activity for installation and
and existing fields. subsequent operations. We expect China to become
the largest region for offshore wind, followed by North
Drilling rig activity naturally scales with levels of America, OECD Pacific, and Europe. Our analysis does
exploration, new field developments, and oil and gas not include offshore aquaculture or other non-energy
production. It will follow a similar track to the forecast related activities.
reductions in offshore oil and gas shipping activity.
Geographically, such shipping activity will shift Summarized, much offshore oil and gas ship activity
towards the Middle East and South East Asia, areas will decline over the forecast period, while offshore
that will dominate offshore production wind requires significant new shipping activity. 
and new developments.

figure 4.13 offshore oil and gas activity relative to 2015

Units: Percentage of 2015 level

120%

100%

80% Natural gas production

60%

Natural gas capacity


additions
40%
Crude oil production

20%

Crude oil capacity


0% additions

2015 2020 2025 2030 2035 2040 2045 2050

Source: DNV GL

49
5
THE ENERGY
TRANSITION:
IMPLICATIONS
FOR WORLD
FLEET
5.1 technology and 53
fuel uptake
5.2 future fleet size 56
5.3 energy mix and co2 58
emissions
5.4 carbon efficiency and co2 62
emission development
dnv gl energy transition outlook – maritime

5. the energy transition:


implications for the world fleet

This section provides an outlook for the world fleet, discussing how
it may develop to meet transport demand in the light of expected
technology developments and upcoming regulations. We focus only
on long-term developments and the fleet needed to meet forecast
demand for transport; we have not modelled short-term cycles.

The projected transport demand in 2050 gas, and other cargo trades: demand for tankers
is 84 trillion tonne-miles, nearly 57% more than will level off and later decline.
in 2015. Strongest growth will be in the container,

52
chapter 5 | implications for world fleet

5.1 technology and


fuel uptake

In Low Carbon Shipping Towards 2050 (DNV GL,


2017c), DNV GL projected the uptake of a wide range
of energy-efficiency measures, alternative fuels,
Energy use and emission
and other emission-reduction technologies based levels will depend
on projected investment decisions and upcoming
regulations. Energy use and emission levels will
on the availability of the
depend on the availability of technological solutions technological solutions
applicable to each segment, their emission-reduction
potential, and uptake rates.
applicable to each
segment, their emission-
Modelled levels of uptake depend on the expected
payback time for each technology and fuel, the
reduction potential,
investment horizons of ship owners, and on regulation and uptake rates.
requiring specific technologies or specifying general
levels of energy efficiency and carbon intensity.

Fleet growth and scrapping rates determine the


possible penetration rate of new technologies and
fuels. Old vessels are scrapped first; new vessels are
added to match expected demand, taking into account
changes in speed, utilization, and ship size.

Possible technologies and solutions to reduce


energy use and CO2 emissions are grouped into three
main categories: alternative fuels; energy-efficiency
measures; and logistics and speed reduction.
Measures evaluated in this study, and their expected
individual impacts, are listed in Table 5.1. The
forecasted percentage changes are relative
to the performance of an ‘average ship’ built in 2015
but running on low-sulphur fuel, as this will be the
default from 2020 with the introduction of global
low-sulphur requirements.»

53
dnv gl energy transition outlook – maritime

table 5.1 technology and fuel options: impact on carbon and energy efficiency

Carbon efficiency (%) Energy efficiency (%) Energy efficiency (%)


(main engines) (auxilliary engines)

Fuel option Baseline: switch to low sulphur fuel - - -

HFO with scrubbers - -5 -5

LNG 20 - -
Biofuels (gas or liquid) 100 - -

Electricity 100 50 50

Energy efficiency Hull form - new buildings - 12-17 -

Hydrodynamics - retrofit - 13-20 -

Machinery improvements - 4-8 12-23


Waste heat recovery - 0-8 -
Battery hybridization - 3-15 -

Operational measures - 3-11 -

Cold ironing - - 30-70


Renewable energy (wind, solar) - 0-10 0-2

Air lubrication - 3-5 -

Logistics and speed Speed reduction (5%) - 10 -5


Vessel utilization - 3-20 -
Increase vessel sizes - 4-14 -

Alternative sea routes - 0-20 -

Sources: DNV GL (2017c), Smith et al (2014), and DNV GL (2017b)

54
chapter 5 | implications for world fleet

Including these measures and related reduction Although the carbon-neutrality of biofuels is debated,
factors in our investment decision model, DNV GL those used in the future will be different from today.
predicts the following trends over the period Third- and fourth-generation biofuels will likely be
2015–2050 (DNV GL, 2017c): closely examined to see if they can be approved for
use and labelled as carbon-neutral and sustainable
__ Fuel consumption per vessel will decline 18% on (see DNV GL 2017a, pp 141, for a more detailed
average due to energy-efficiency measures, mainly discussion on this topic).
hull-form and machinery improvements
__ Vessel speeds will decline by about 5% on average,
In line with established GHG-accounting procedures,
reducing fuel consumption by 10%
emissions from power stations are accounted for when
__ Electricity from batteries will power a third of ships, fuels are combusted for generation. Electricity use
mostly smaller vessels accounting for about a in shipping will thus give zero emissions in the
thirtieth of the total energy demand from shipping maritime sector.
__ LNG and LPG will account for 32% of total shipping
For LNG, we assume a 20% reduction of CO2 emissions,
energy use, and biofuel about 18%
though emissions of unburnt methane (‘methane slip’)
__ Vessel utilization will increase in all segments: may mean GHG emissions are cut by only about 10%.
about 25% for deep sea trades except bulk,
around 5% for deep sea bulk, and some 20% The global 0.5% sulphur limit from 2020 will shift fuel
for short sea ships use to low-sulphur fuels. In the shorter term, ships will
__ The average size of deep sea vessels will rise 40% still use heavy fuel (residual) oil and will be fitted with
scrubbers, but this solution will be phased out in the
for LNG tankers (due to more deep sea vessels),
longer term. Such exhaust-gas cleaning will result
30% for container and other cargo, and 10%
in a 5% fuel-consumption penalty for the affected
for bulkers
fleet, but will not impact on the forecasted energy
consumption in 2050.
This study assumes, in line with the Intergovernmental
Panel on Climate Change, that combustion of biofuels
and use of electricity is carbon-neutral. Any emissions
due to production are accounted for elsewhere in
our ETO analysis and are not double-counted in this
maritime outlook.

55
dnv gl energy transition outlook – maritime

5.2 future fleet size

The projected fleet size in deadweight tonnes will High demand growth for LNG tankers will see the
rise by almost half (48%) by 2050. The forecasted fleet size double by 2030 but then slip back for a total
development by segment is shown in Figure 5.1. We increase of 146% by 2050. The bulk segment will
predict that the crude oil fleet will decrease by nearly remain relatively stable with moderate long-term
a fifth (18%) come mid-century, peaking around growth of about 34% to 2030 and 50% to 2050. The
22% greater than today in 2030, before it is shrinking greatest increase after gas carriers will be in the
towards 2050. The product tanker fleet will by then be container segment where fleet size grows with GDP
about the same size as today. and rises 66% to 2030 and 143% to mid-century.

figure 5.1 fleet development 2015-2050 by segment

Units: Million DWT Segment

3 000 Non-cargo
Other cargo
Container
2 500 Bulk
Natural gas
Oil products
2 000 Crude oil

1 500

1 000

500

0
2015 2020 2025 2030 2035 2040 2045 2050

Source: DNV GL

56
chapter 5 | implications for world fleet

figure 5.2 impact of selected drivers on cargo fleet size by 2050

Units: Number of ships

65 000

63 800
64 000

63 000

62 000

61 000 2 900 60 600


-2 900
60 000

59 000

58 000
-3 200
57 000

56 000

Baseline fleet size Increased utilization Increased size Speed reduction Expected fleet size

Source: DNV GL

For other cargo vessels, we predict a doubling of the The effects of these drivers vary by shipping segment.
fleet by 2050. Figure 5.2 illustrates our predictions for their individual
and combined impacts on cargo fleet size by 2050,
The demand for non-cargo ship transportation and with the baseline being the expected fleet numbers in
services, including offshore, are not modelled directly, 2050 without any improvements or speed changes.
but are included for the purpose of estimating the The increased need for tonnage due to reduced speed is
fleet size and energy use. Average annual growth for negated by the increased utilization of the fleet. Increased
these demand parameters is assumed to be 2.0% vessel size will reduce the number of vessels, but does not
(DNV GL, 2017b) for non-cargo vessels, which results change the total deadweight of the fleet. 
in a forecasted doubling of the fleet by 2050.

The number of ships and total fleet size (deadweight)


will grow differently than demand (tonne-miles).
Speed reduction, vessel utilization, and vessel size
will impact directly on the relationship between
tonne-miles to be transported and the corresponding
deadweight tonnage. Lower speed requires higher
deadweight tonnage to handle the same transport
work, while better utilization and larger ships reduce
the deadweight tonnage needed.

57
dnv gl energy transition outlook – maritime

5.3 energy mix and co2 emissions

We forecast that by 2050, nearly half (47%) of shipping


energy will be supplied by oil-based distillates, 32%
by gas, and only 21% by sources with significantly-
reduced carbon footprints, such as electricity and
biofuels (Figure 5.3). Short sea shipping will use 37% of
the total energy, and in these segments electricity can
constitute a significant share (9%) of energy use.

Total energy use and energy efficiency vary


considerably between segments with their typical sizes
and speeds. Product tankers are generally smaller and
less energy efficient than crude oil carriers, but the
number of the former is higher and their total energy
use is about the same as for the carriers.

Greater energy efficiency coupled with speed


reduction will see energy use per tonne-mile shrink
by 35–40%, with the highest potential reduction being
in container, LNG tanker, and other cargo carriers
(Figure 5.4). For tank and bulk, current operating
patterns already include slow steaming; further
reductions will be harder to achieve.
Greater energy efficiency
The container and bulk segments will account for the coupled with speed
largest shares of total shipping energy use, 35% and
20% respectively. We predict that total energy use in
reduction will see energy
international shipping will increase from about 10.7 EJ use per tonne-mile shrink
in 2015 to 12.0 EJ in 2050. This equates to 256 Mtoe in
2015, while figures for 2050 are 276 Mtoe of Heavy Fuel
by 35–40%.
Oil (HFO)/Marine Gas Oil (MGO), LNG, and biofuels,
and an additional 110 terawatt houss (TWH of
electricity).

58
chapter 5 | implications for world fleet

figure 5.3 shipping energy mix 2050

Segment

Total fleet Deep sea Short sea HFO/MGO


LNG
Biofuel
3.8 EJ 5.6 EJ 2.5 EJ 3.8 EJ 1.4 EJ 1.7 EJ Electricity
32% 47% 32% 50% 32% 41%

2.2 EJ 1.4 EJ 0.8 EJ


0.4 EJ 0.4 EJ
18% 18% 18%
3% 9%

Source: DNV GL

59
dnv gl energy transition outlook – maritime

figure 5.4 fleet characteristics 2015–2050 by ship segment

Units: Million DWT

1 200

1 000

800
Fleet size

600

400

200

0
Crude oil Product tankers Natural gas Bulk vessels Container Other Non-cargo

Units: MJ/tonne-mile

0.5

0.4
Energy efficency

0.3

0.2

0.1

0
Crude oil Product tankers Natural gas Bulk vessels Container Other

Source: DNV GL

60
chapter 5 | implications for world fleet

Units: Billion tonne-miles/yr Years

40 000 2015
2050
35 000

30 000
Transport work

25 000

20 000

15 000

10 000

5 000

0
Crude oil Product tankers Natural gas Bulk vessels Container Other

Units: EJ/yr

3
Energy use

0
Crude oil Product tankers Natural gas Bulk vessels Container Other Non-cargo

61
dnv gl energy transition outlook – maritime

5.4 carbon efficiency and co2


emission development

Grouped into three categories – energy-efficiency


measures, alternative fuels, and logistics
improvements and speed reductions – the drivers in
CO2 emissions for
our model will progressively decarbonize shipping by international shipping will
2050. We forecast that average carbon efficiency (CO2
emitted per tonne-mile) on average will improve by
fall by a quarter from 800 Mt
51% by then (Figure 5.5). This assumes the availability to 594 Mt by 2050.
of 2.2 EJ or 51 Mtoe of biofuels, which is about 4% of
the total projected global modern biomass energy
available in 2050 (DNV GL, 2017a).

figure 5.5 shipping: average carbon efficency 2015-2050

Units: Gramme CO2 per tonne-mile

62
chapter 5 | implications for world fleet

figure 5.6 international shipping: emissions pathway 2015–2050

Units: Million tonnes CO2/yr Segment

1 500 Logistics and speed


Fuel
Energy efficiency
Baseline
1 000
Remaining

500

0
2015 2020 2025 2030 2035 2040 2045 2050

Source: DNV GL

Based on projections of demand for maritime transport


work, we forecast that CO2 emissions for international
shipping will fall by a quarter from 800 Mt to 594 Mt
(Figure 5.6) by 2050. Carbon-neutral fuels contribute
around 40% of the total CO2 reduction by mid-century.
The impact of lower speeds and other logistical
measures can be achieved to full effect early in
the period up to 2035, as these options can be
implemented without renewing the fleet. Beyond
2035, we will see the full impact of gradually improving
the energy efficiency of new ships and the shift to
alternative fuels.

63
dnv gl energy transition outlook – maritime
6
KEY ISSUES
TO MONITOR
6.1 the next five years 67
6.2 potential game-changers 69
towards 2050
dnv gl energy transition outlook – maritime

6. key issues to monitor

This section addresses some key issues by segment


to monitor over the next five years, and potential
game-changers that could shift our projections in
the long run towards 2050.

While the model forecasts the most likely development


of the energy transition based on our current
assumptions and data sets, the actual pathways and
The rapidly evolving digital
outcomes in 2050 will remain subject to change. economy, influences
There are naturally uncertainties to the projections
international trade.
presented here, and further details of the sensitivities
of our analysis are available in the main report (DNV GL,
2017a). Other studies have forecasted stronger growth
in transportation demand (e.g., Fang et al, 2013; OECD/
ITF (International Transport Forum) 2017; Sharmina et
al, 2017; OECD/ITF 2016; OECD 2014). This is partly
explained by their expectations of higher economic
growth, fossil fuel use, and trade multiples compared
with the levels factored into our ETO analysis. An
overview of short- and medium-term seaborn trade
forecasts has been provided by UNCTAD (2017, Table
1.11).

66
chapter 6 | key issues to monitor

6.1 the next five years

The main ETO report devotes a separate chapter to key It is important to monitor whether this pattern continues
issues that are important to monitor over the next five and spreads to more countries. Complicating the
years, and which will indicate where our projections picture for the seaborne grain trade in the future,
might diverge from actual outcomes. Some issues are the offsetting impacts of improving agricultural
are particularly important to maritime transport, productivity and global climate change. There is both a
and some are key for all maritime market segments. significant upside and downside potential for this trade,
The world fleet development is driven by many factors, particularly with respect to the developing countries.
such as newbuilding activity, scrapping, deliveries,
changes of newbuilding, and second-hand and scrap container
prices. In addition, one needs to pay attention to In the container segment, the seaborne trade versus
speed, congestion, and lay-ups, as well as port and GDP multiplier has been gradually falling in the recent
logistic capacity developments. All these elements years. However, in 2017 this indicator reverted up to the
will shape the future size and the productivity of the previous higher levels. If it falls below 1.0, it may indicate
fleet, and thus influence the capacity utilization that, that our forecast for container trade may be on the high
ultimately drives the earnings. All these factors should side. Increased regionalization will further increase
be closely monitored. Specific regional initiatives, such intra-regional trade, consequently reducing the
as the “One Belt and One Road” initiative in China importance of the major trunk lines between continents
and the expansion of the Northern Sea Route (NSR), and will naturally lead to shorter voyage distances.
could also factor into changing trade patterns Containerization of the trade continues to develop
and fleet requirements. into new areas. This will not only increase the container
trade, but it will also reduce the other cargo trades. For
Key issues to watch in the bulk, container, gas example, food importers in Asia are switching from
and oil tanker shipping segments over a five-year dry bulk cargo ships to container vessels, filling empty
horizon are discussed below. containers after unloading consumer goods in Western
countries2. The impacts of ship upsizing, the expansion
bulk of the Panama Canal, and the emergence of mega-
The share of globally produced coal that is traded on alliances could also lead to improved fleet capacity
keel is relatively low. As such, any predictions about utilization.
coal trade are consequently very sensitive to domestic
coal production levels, particularly in China and India. Rapidly evolving digital economy, influences the
If these regions reduce local production, demand international trade as well and thus should be closely
for seaborne coal trade will not decline as forecast. monitored. For example, trade in ICT (information
Non-coal bulk has been dominated by growth in and communications technology) goods has grown
China, where the trend in recent years indicates a dramatically over the last decade. In addition,
slower industrial production growth and a gradual shift worldwide shipments of 3D printers more than doubled
towards a more service-oriented economy. in 2016, and sales of robots are on their »

67
dnv gl energy transition outlook – maritime

highest level ever (United Nations and UNCTAD, oil tankers


2017). Also, products are increasingly purchased The geopolitical situation in the Middle East tops the
and delivered across borders, with some 380 million agenda for tanker owners; stability in Iran, Iraq, Saudi
consumers making purchases on overseas websites. Arabia, and neighbouring countries is considered
important. OPEC's (the Organization of Petroleum
gas Exporting Countries) evolving strategy regarding
Today, more international gas trade is piped than production limits, not to mention the degree to which
moved on keel. However, Europe especially, the this is implemented, might alter crude shipping in the
security of the supply of piped gas from Russia has coming years. Oil is a global commodity and average
been called into question, and many projects are transport distances are linked to changes in global
underway to reduce this uncertainty of supply through production patterns - for example, continued increases
imports of LNG. Attention should also be paid to in output of North American shale oil. Trade routes
the geopolitics of the Middle East and the shale gas could diverge from the trends we expect, thereby
revolution in North America. North America will soon extending or shortening actual trade distances.
become a major global LNG exporter, which will have China, with its increasing imports, could be used as
a substantial impact on the future global gas transport an example, as it constantly diversifies the sources
patterns and sailing distances. Developments in of oil supply. Moreover, over the next few years we
Australia will play a key role in providing LNG to assume a significant improvement in transportation
the Asian countries. In addition, new projects such fuel efficiency worldwide, and especially in North
as Yamal in Russia, Malaysia and Cameroon will America. In some countries where fuel efficiency is
also influence the future global trade of LNG. not regulatory driven, a low fuel price might delay the
We forecast that an increasing share of world gas expected improvement.
transport will be on keel. Finally, the booming FSRU
(Floating Storage and Regasification Unit) market
introduces new LNG importers, which again will
have an impact on the trade. In the short term, the
construction of gas terminals and new pipelines will
see our forecast either validated or refuted.

68
chapter 6 | key issues to monitor

6.2 potential game-changers


towards 2050

Key drivers that could trigger game-changing shifts successful, and is supported by governments and
in energy use, emissions, transport, and technology related international bodies, decarbonization of the
development in shipping include the following: sector will progress further and faster than projected.
That said, IMO requirements will, in any case, not take
decarbonization and effect before 2023, and its GHG strategy may not have
environmental awareness a significant impact before the end of the next decade.
Future energy emissions are forecast to be far higher,
and to contribute to stabilization at 2.5°C more than New regional or local regulatory requirements, targets
pre-industrial levels, the least ambitious target and policies on GHG emissions and/or fuel types could
in the Paris Agreement (DNV GL, 2017a). change the competitiveness of energy-efficiency
technologies and alternative fuels. The impact of
The energy shifts needed to achieve the 2°C, and more decarbonization and how shipping can handle
ambitious 1.5ºC targets, are key uncertainties when associated the risks and opportunities are discussed in
predicting future energy use and energy trade on keel. Section 7.
Only extraordinary steps, combining governmental,
private sector, and societal efforts can avoid As pressure on land use increases, the marine
overshooting the global-warming limits. The impetus environment will assume more importance in achieving
of the Paris Agreement and implementation of national the UN’s Sustainable Development Goals. Shipping
and international policies could drive technology has a critical role to play in facilitating the development
development of emission-reduction solutions and of of offshore wind, tidal, and wave energy, the harvesting
carbon capture and storage technologies (CCS). The of food and raw materials from the oceans, and in
impact on maritime trade can work in both directions: providing sustainable transport solutions for cities
failure to follow up on the Paris Agreement, or wide and other populated coastal areas (DNV GL, 2017d).
scale adoption of CCS, could sustain higher trade in Transport of fresh water may emerge in the long term,
fossil-based energy than those projected. Conversely, and we can expect a higher demand for construction
if fossil-based fuels are phased out entirely, trade in oil materials in order to adapt to a changing and less
and coal will decline significantly and could even be hospitable climate (OECD, 2017).
replaced by other energy carriers such as biomass/
biofuels, and hydrogen. major shifts in transport demand
Energy is not the only category of trade subject to
The shipping energy use and emissions, forecasts uncertainty. There is, for example, vast potential to
described in Section 5 suggest that the sector’s improve the level of recycling of industry input factors.
emissions will decline by a quarter by 2050. A There is rising interest in, and action to, establish ment
forthcoming IMO GHG strategy will address emission of circular economies, which reduce consumption of
reductions from international shipping3 ; it is not virgin materials and the generation of waste, trends
part of the Paris Agreement. If the strategy is entirely that might shift transport demand. »

69
dnv gl energy transition outlook – maritime

We assume increasing use of renewable electricity in Trade liberalization over the past decades has
manufacturing, and greater reuse of materials. It will generally benefitted international trade and maritime
take a significant improvement in heavy industry’s transport. Recent years have brought renewed focus
processes to enable such shifts. If this does not happen, and debate on trade liberalization. Protectionist
trade in energy, finished goods, and raw materials trade policies would pose a potential downside risk
will be affected. to maritime transport. Our base assumption is that
prevailing trade regulations and relevant governance
Grain currently accounts for only about 10% of total institutions will continue unchanged so that, at least in
bulk trade. Based on a scenario in which the global the medium term, the risk to trade will be less than from
population reaches 9.2 billion in 2050 – similar to the energy transition and manufacturing’s decreasing
our own assumption – the Food and Agriculture share in advanced economies.
Organization (FAO) of the United Nations expects food
imports in the developing world to double by then digitalization and innovation
(FAO, 2017). If so, our assumption of a mildly growing Digitalization can reduce the cost of shipping while
bulk grain fraction is too conservative, and bulk trade improving safety. It is set to enable reduced downtime,
would be higher. predictive maintenance, performance forecasting,
real-time risk management, and energy efficiency.
Significant trade volumes between big actors – such Operators will generate cost savings through
as China and India on one side, and Russia and Central advanced data analytics, process digitalization, robotic
Asia countries on the other – may flow via other modes, process automation, and connecting and sensing
such as rail and pipelines, as an alternative to seaborne technology (DNV GL, 2014).
transportation. Large infrastructure-development
projects, such as China’s OBOR (One Belt and One We assume that digitalization will boost shipping
Road) initiative and the Japan-Asian Development efficiency and improve related energy use, increase
Bank partnership, will stimulate growth and demand utilization of the current fleet by improving logistics
for seaborne transport (UNCTAD, 2016). For example, and planning, boost port development, and enhance
the OBOR initiative involves construction of a trade voyage performance through better weather routing
network involving 60 countries, with around 900 and autopilot. Indirectly, digitalization can enable
projects either under negotiation or under way new business models and better ship operation, with
(UNCTAD, 2016; 2017). On the other hand, OBOR also a positive impact on energy use. Autonomous ships
predicates a significant increase in land-based trade, can sail at very low speeds without incurring high crew
which would negatively affect seaborne. costs, allowing greater use of batteries and other fuel
types (DNV GL, 2014).
Additive manufacturing, or 3D printing, could gain
significant momentum. It is expected to have some Innovative ship concepts may also emerge to create
impact on trade in manufactured goods, but less so for a leap forward in performance. Examples include
raw materials, as these still have to be transported from ballast-free ships, and low- and zero-emission hybrid
the original sources. The increased use of robots could ships, incorporating various advances such as novel
enable relocation of production back to developed hull forms above and below the water, innovative light
countries, shortening global value chains, and materials, alternative powering, including from shore,
potentially reducing demand for seaborne transport and energy-storage modules. 
(OECD, 2016b).

70
chapter 6 | key issues to monitor

71
dnv gl energy transition outlook – maritime
7
THE CARBON-
ROBUST SHIP
dnv gl energy transition outlook – maritime

7. the carbon-robust ship

In this section we assess the impact of a low carbon future


on the maritime industry, primarily in terms of ship structures
and vessel and fleet operations. The "carbon-robust ship" is
a framework to evaluate and improve competitiveness and
profitability in a market, climate and regulatory environment.

With the forecast, energy future, the world fails to The maritime industry is confronted with the need
achieve the Paris Agreement’s target of limiting to adapt to a future in which carbon efficiency will
average global warming to well below 2°C above become a more important source of competitive
pre-industrial levels. Securing a 2°C future will not advantage, but where the scale, pace, and policy
be achieved without a steeper reduction in the use, drivers of decarbonization are uncertain. Even if the
and hence transport, of fossil fuels. A low-carbon world does get on track for a well below 2°C future,
future would also require more energy-efficient ship the exact impact on the global shipping sector is
designs and operations, and carbon-neutral fuels. unknown; intenally, the industry will be subject to
Future regulations and stakeholder expectations might emission reduction requirements, and external
require significant investments to upgrade and renew expectations will be that the sector contributes to
ships. global decarbonization.

74
chapter 7 | the carbon-robust ship

Companies need first to understand how climate An approach to evaluating the carbon robustness of
change trends will impact commercial risk. In vessels and fleets is outlined in Figure 7.1. It builds on a
considering this, we introduce the term ‘the carbon- three-step approach, identifying risk and opportunity
robust ship’. It refers to a ship or fleet that can maintain drivers, scenario-stresses testing, and assessment of
both short- and long-term profitability, given any carbon robustness. A key component to evaluating the
decarbonization scenario. Amidst an uncertain energy carbon robustness, is to stress-test how well a ship, fleet,
transition, a vessel launched today may well experience and company perform under different energy transition
abrupt market and regulatory changes in its lifetime. scenarios.»
A ship that can withstand not only stormy weather, but
also noticeable market and regulatory changes will
become indispensable.

A vessel launched today may


well experience abrupt market
and regulatory changes.

75
dnv gl energy transition outlook – maritime

step 1: risk and opportunity drivers __ Technology: Technology will assist efforts to
Start by identifying risk and opportunity drivers directly limit global warming to well below 2°C. There
impacting business performance measures such will be a continued focus on achieving cost
as profitability. Drivers depend on segments, ship savings through energy-efficiency technologies.
types, relevant technologies in the fleet, regulatory Policymakers may introduce or vary incentives
developments, stakeholders, and weather conditions. for technologies that promote decarbonization
and may penalize less environmentally-friendly
Identification can be structured around key performance. Either way, the business benefits of
uncertainties associated with climate change and cleaner shipping will be strengthened. It will be
decarbonization. Among these, physical climate risk important to be able to create flexible ships with
refers to structural changes in the climate system low retrofit costs, or to develop vessels whose
leading to alterations in natural operating conditions energy costs will be competitive in both the short-
for shipping. Extreme weather may impede vessel and long-terms.
operations by challenging the structural integrity of __ Markets: Curbing climate emissions to the degree
the ship. More chronic climate change may eventually
necessary to limit global warming to well below
change trade patterns due, for example, to shifts in
2°C will require changes in global trade volumes
production patterns related to agricultural production,
and patterns. Fossil-fuel trade could experience
while also creating new commodity trade demands.
a much more dramatic fall than we forecast.
Demand for trade in new or expanding energy
Non-physical climate-change risk and opportunity
carriers, such as biofuels and hydrogen, could
factors are associated with uncertainty arising from
emerge and escalate. Short sea shipping and new
society’s transition to a ‘well below 2°C’ world. If the
vessel operations tied to renewable energy and
transition happens, these inter-linked risk factors
new ocean industry-related ‘blue growth’ might
will impose dramatic changes for the commercial
further drive innovative thinking on how the
operating conditions for shipping. For the maritime
maritime industry can play a supporting role
industry, the impact of change could come through:
towards a more sustainable future.
__ Regulation: Achieving the Paris Agreement will __ Stakeholders: We are already seeing stakeholders
require tighter GHG policies. This will likely entail in the maritime industry are heightening their focus
global/regional regulation of ship CO2 emissions on climate concerns. Finance sector requirements
and of other industry sectors – which may affect on climate risk assessment and disclosure
patterns of trade demand for shipping – and the may become common in a few years.
introduction of pricing of ship CO2 emissions. More If so, carbon performance and climate-risk
energy-efficient ships will be less exposed to CO2 exposure will be required information.
cost levels and thus more carbon robust.

76
chapter 7 | the carbon-robust ship

step 2: scenario stress-testing These factors are:


This involves testing the impact of several scenarios
on performance indicators to assess how a ship or fleet __ Carbon flexibility: the ability of a ship/fleet
will respond to challenges. The forecast presented to withstand different future carbon prices
in this report is our view of the most likely development __ Fuel flexibility: the ability of a ship/fleet to switch
of the energy transition, but other possibilities are
between fuel types throughout its lifetime
discussed in Section 6. For example, it is plausible that
to enable use of the most advantageous fuel
political action, in line with the Paris Agreement, will
result in a high carbon price. If a ship is energy efficient, __ Retrofit flexibility: the ability of a ship to adopt
or uses carbon-neutral fuels, its exposure to carbon a ‘wait and see’ strategy; additional space on
pricing will be mitigated. The operating costs of well the ship may be designed to allow for cost-effective
designed and operated ships will be lower than those retrofitting when or if needed
of more energy- and carbon-intensive vessels. __ Speed flexibility: the ability of a ship to sail
at an optimal speed under different market
step 3: carbon robustness
demand and fuel price scenarios
The final step is to calculate the carbon robustness
of a ship or company fleet, and develop mitigating __ Cargo flexibility: the ability of a ship to transport
strategies. It involves assessing various factors different cargo types to adapt to changes
that impact on the ability to handle potential in market demand 
decarbonization and climate-change scenarios.

77
dnv gl energy transition outlook – maritime

references

1 The world merchant fleet - Statistics from Equasis’, 8 DNV GL, (2017e). Oil & Gas, Forecast to 2050.
http://www.emsa.europa.eu/equasis-statistics/ Energy Transition Outlook 2017
items.html?cid=95&id=472
9 DNV GL, (2017f). Renewables, power and
2 Food importers shift from dry bulk cargo ships to energy use, Forecast to 2050 Energy Transition
containers Outlook 2017
https://www.reuters.com/article/agri-container/
food-importers-shift-from-dry-bulk-cargo-ships-to- 10 DNV GL (2014), The Future of Shipping, 2014
containers-idUSL5N0LF3MZ20140214
11 Endresen, Ø., Sørgård E., Sundet J. K. ,
3 Low carbon shipping and air pollution control Dalsøren S. B., Isaksen I. S. A., Berglen T. F.,
http://www.imo.org/en/MediaCentre/HotTopics/ and Gravir G., Emission from international sea
GHG/Pages/default.aspx transportation and environmental impact,
Journal of Geophysical Research, 108 (D17), 4560,
4 DNV GL, (2017a). Energy Transition Outlook 2017: doi:10.1029/2002JD002898, 2003
A global and regional forecast of the energy
transition to 2050 12 Fang, I. et al (2013), Global Marine Trends
2030. Lloyd’s Register, QinetiQ and University
5 DNV GL (2017b). Navigating a low-carbon future, of Strathclyde. http://www.futurenautics.
DNV GL report 2017-0205 for the Norwegian com/wp-content/uploads/2013/10/
Shipowners’ Association GlobalMarineTrends2030Report.pdf

6 DNV GL (2017c), Low Carbon Shipping 13 FAO (2017). Food and Agriculture Organization of
Towards 2050 the United Nations. How to Feed the World in 2050.
Executive summary. Rome. Accessed Nov 14, 2017.
7 DNV GL (2017d), Sustainable Development Goals: http://www.fao.org/fileadmin/templates/wsfs/
Exploring Maritime Opportunities, Report for the docs/expert_paper/How_to_Feed_the_World_
Norwegian Shipowners’ Association. in_2050.pdf
https://www.rederi.no/globalassets/dokumenter-
en/all/fagomrader/smi/dnv-gl-sdg-maritime-
report.pdf

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14 OECD/ITF (International Transport Forum) (2017), 19 UNCTAD (2017), Review of Maritime Transport, UN,
ITF Transport Outlook 2017, ISBN 978-92-82-108 New York, ISBN 978-92-1-112922-9
00-0
20 UNCTAD (2016), Review of Maritime Transport, UN,
15 OECD/ITF (International Transport Forum) (2016), New York, ISBN 978-92-1-112904-5
Capacity to grow, Transport Infrastructure Needs
for Future Trade Growth, https://www.itf-oecd.org/ 21 United Nations and UNCTAD (2017), Information
Economy report 2017, Digitalization, Trade
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Getting The Policies Right – Environment, 978- 92-1-112920-5. http://unctad.org/en/
Working Paper No. 121 PublicationsLibrary/ier2017_en.pdf

17 OECD (2014), International Freight and Related 22 Sharmina et al (2017). Global energy scenarios and
CO2 emissions by 2050: A new modelling Tool, their implications for future shipped trade. Marine
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dp201421.pdf
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Environment, ISBN 978-92-64-07919-9 UK, June 2014

FOOTNOTES
1
 ‘The world merchant fleet - Statistics from Equasis’, http://www.emsa.europa.eu/equasis-statistics/items.
html?cid=95&id=472

2
 https://www.reuters.com/article/agri-container/food-importers-shift-from-dry-bulk-cargo-ships-to-containers-
idUSL5N0LF3MZ20140214

 http://www.imo.org/en/MediaCentre/HotTopics/GHG/Pages/default.aspx
3

79
dnv gl energy transition outlook – maritime

energy transition outlook


Our main publication deals with our model-based
forecast of the world’s energy system through to 2050.
It gives our independent view of what we consider ‘a
most likely future’, or a central case, for the coming
energy transition. The report covers:

__ Our main assumptions, on population,


productivity, technology, costs and the role
of governments
__ The model behind our forecast results
ENERGY OIL AND GAS
__ Our findings on global energy supply, demand
RENEWAB
TRANSITION FORECAST TO 2050 AND ENER
OUTLOOK andTransition
Energy eachOutlook
of the energy carriers — and a sensitivity
2017 FORECAST
2017 analysis Energy Transition Outlook 201

A global and regional forecast __ Energy forecasts for each of our 10 world regions
of the energy transition to 2050

__ Issues to watch in the next 5 years


SAFER, SMARTER, GREENER SAFER, SMARTER, GREENER SAFER, SMARTER, GREENER

__ The climate implications of our outlook

__ Highlights from our supplementary reports.

oil and gas forecast to 2050


Oil and gas will be crucial components of the world’s
energy future. While renewable energy will increase
its share of the energy mix, oil and gas will account for
44% of world energy supply in 2050, compared to
53% today.

In our oil and gas report, we have translated the energy


requirements of key demand sectors into the trends we
expect to see across the value chain. We discuss how
the oil and gas energy system will meet this demand
OIL AND GAS from existing and new production
RENEWABLES, POWER capacity. We also
FORECAST TO 2050 consider
AND ENERGY USE pipelines, and the
implications for LNG and
Energy Transition Outlook 2017 FORECAST
roles digitalization andTO 2050
emerging technologies will play
across the value chain.
Energy Transition Outlook 2017

SAFER, SMARTER, GREENER SAFER, SMARTER, GREENER

80
renewables, power and energy use
forecast to 2050
This report presents implications of our energy
forecast for key stakeholders including electricity
generation, including renewables; electricity
transmission and distribution; and energy use.
The report covers: 

__ Key conclusions from our model

__ Key technologies and systems, focusing on


results from the model and on the expected key
RENEWABLES, POWER developments. The technologies and systems
AND ENERGY USE considered include: onshore and offshore wind; solar;
FORECAST TO 2050
hydropower; biomass; nuclear; coal; transmission
Energy Transition Outlook 2017
grids and system operation; distribution grids;
off-grid and micro-grids; electrification of energy
use; buildings and their energy efficiency; energy
SAFER, SMARTER, GREENER efficiency in manufacturing industry; and storage.
__ Takeaways for specific types of stakeholders

__ Important issues to monitor over the next five years

maritime forecast to 2050


In our Maritime report, we describe the consequences
of the energy transition for the maritime industry.
We examine the goods to be transported within and
between regions, and the types of vessels needed.

The report examines the transport of energy sources


such as crude oil, oil products, gas and coal. We also
provide forecasts for the following ship segments:
containerized cargo; bulk; and other cargo. The
outlook for offshore service ships is also discussed.
MARITIME
FORECAST TO 2050
Energy Transition Outlook 2017

SAFER, SMARTER, GREENER

81
SAFER, SMARTER, GREENER

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