Osman Düzgün

Project title: Exploring the Concept of a Book & Claim Based Carbon Insetting System for the Maritime Shipping Industry - A Case Study for the Port of Rotterdam

Problem Statement
The maritime industry is responsible for nearly 3% of the annual global greenhouse gas emissions; simultaneously the industry is projected to continue to grow its emissions footprint in the coming decades while the world faces an increasingly urgent global climate crisis. The maritime shipping industry is crucial to the global distribution of goods, as 90% of all goods are shipped by sea. Alternative fuels can help the maritime shipping industry to lower its emissions. Alternative fuels are defined to be fuels that are derived from sources other than petroleum, resulting in a lower environmental impact compared to conventional fuels. Examples of alternative fuels are biofuels, hydrogen, methanol and ammonia. Unfortunately, the adoption of such alternative fuels is going slower than many had hoped. Carbon insetting is a potential tool to help increase the adoption of alternative fuels in the maritime shipping industry. Carbon insetting is the practice in which parties pay for projects that represent an effective CO2 emission reduction within the industry that is being inset (e.g., airplanes using sustainable aviation fuel). Effectively allowing shippers to reduce/inset the emissions that result from the transportation and distribution of their goods. Setting up a system for shippers (parties with a transportation desire for their goods) to enable them to choose carbon insetting could potentially be a way to accelerate the decarbonization of the maritime shipping industry by creating a second demand stream for alternative fuels; for use in carbon insetting projects financed by shippers instead of only demand by carriers. Unfortunately, carbon insetting is not that easy for shippers to achieve. Container vessels of carriers come in various sizes, with large vessels having a carrying capacity of more than 15.000+ containers. Meaning that each vessel will have containers from potentially thousands of different shippers. It is difficult to determine which shippers want their goods to be transported more sustainably and how much alternative fuel needs to be brought onboard to fulfil their demands. Especially when
considering that bundling of demand for alternative fuels would be more efficient, bunkering large volumes of alternative fuels is going to be significantly cheaper than bunkering a small volume. E.g., bunkering alternative fuel for 5 out of the 15.0000 containers onboard a vessel for a single shipper would be both economically- and technologically infeasible. Simultaneously, alternative fuels might not even be available between the ports a particular shipper wants their goods to be shipped between. Thus, the demand for the sustainable transportation of goods is fragmented. There needs to be a way to bundle the demand for sustainable transportation for shippers, not just for the volume of alternative fuels but also for the geographic spread of the demand for this service. This would make carbon insetting more accessible to even small shippers due to the lower price entry barrier.

Knowledge Gap
This is where the book & claim chain of custody concept could be a potential solution. Using book & claim the CO2 certificates for carbon insetting could be generated in the most efficient location for bunkering alternative fuels, where a large volume of alternative fuels are then bunkered onboard a different ship. These CO2 certificates represent the CO2e emission reduction achieved by the bunkering of alternative fuels onboard the ship in the carbon insetting initiative. These generated CO2 certificates can then be traded internationally through a platform that is supported by the book & claim chain of custody concept. Effectively bundling the demand for volume and demand for carbon-neutral shipping, enabling interested shippers to choose for carbon insetting without any change in the logistics of their goods. There is very little literature available on using the book & claim chain of custody concept for carbon insetting, especially for how such a system/initiative needs to look like for the maritime industry in order for it to work. What characteristics, requirements and system properties does such a system need to have to work effectively?
Research Questions
Main question
How can a carbon insetting initiative based on the book & claim chain of custody concept enhance the position of the port of Rotterdam for the bunkering of alternative fuels?
Sub-questions
1. What is the added value of a book & claim based carbon insetting initiative for the Port of Rotterdam?
2. What can such a book & claim based carbon insetting initiative look like?
3. What role can the Port of Rotterdam take in a book & claim carbon insetting initiative in the port of Rotterdam?
Research Methodology
A case study for the Port of Rotterdam. Using information gathered from a literature review and a (semi-structured) workshop for a selection of Port of Rotterdam employees to gather their professional opinion on how such a carbon insetting initiative should be approached.