Maritime book & claim system: a new tool in the decarbonisation of shipping

The Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping (MMCZCS), RMI, Danish Shipping, and Maersk Oil Trading have released two publications outlining their new Maritime Book & Claim system. The system, which will undergo a pilot later this year, is a promising step towards unlocking the potential of green shipping.

Responding to industry demand

There is growing momentum behind Book & Claim systems as a tool to facilitate efficient and flexible decarbonisation. Indeed, IRENA recently described Book & Claim as “a solution to the logistical challenge of scaling [the] nascent market” for hydrogen and its derivatives. Similarly, a recent study into an Australian – East Asian green maritime corridor concluded that Book & Claim is a viable method for procuring ammonia fuel.

The MMCZCS scheme seeks to accelerate this decarbonisation process. It will establish a registry in which ships can ‘book’ the emissions associated with a particular voyage, which consumers can then ‘claim’. This empowers cargo owners to offer a green premium for low- or zero-emissions shipping, even if such shipping is unavailable for their particular journey. Likewise, a zero-emissions ship can confidently take on cargo at any location without an associated green premium, in the knowledge that they can obtain that premium at a later date.

Pernille Dahlgaard, Chief Officer of Business, Regulatory and Analytics at the Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping, believes the system will play a significant role in driving wholesale decarbonisation of the shipping industry.

This system will allow shipowners and operators to access a broader market of cargo owners willing to pay a green premium, monetize their green services, and recover investments in decarbonization technologies. As a result, it will trigger more investments in green shipping and accelerate decarbonization across the industry.

From New Maritime Book & Claim System Strengthens Business Case for Green Shipping, (MMCZCS, Apr 2023)

Implementation Challenges

Book & Claim systems, as efficient and effective as they may be, are challenging to implement. The UK Government has gone as far as stating that such systems introduce a risk of “greenwashing”, given that their effective operation relies entirely on credible, transparent record-keeping. To mitigate that risk, the MMCZCS system has introduced various countermeasures to promote robustness.

The system is “based entirely on primary data…collected from the ship during the actual voyage”, which means that participants in the scheme will have to adopt extensive onboard data collection and real-time reporting practices.

Furthermore, the system relies entirely on “swaps” as opposed to “transfers”. A participant seeking to lower the emissions intensity of their shipping must first claim tokens for their conventionally-fuelled journey, and then identify a counterparty with an equal quantity of tokens generated with the use of a low-carbon fuel.

In some alternative schemes (such as the RSB’s Book & Claim system for sustainable aviation fuel), participants are able to purchase sustainable tokens directly. While a transfer-based system can reduce the burden of participation, there are several benefits to using “swaps”. Firstly, as the MMCZCS emphasizes, swaps help ensure that all emissions within the system are “traceable and [remain] on someone’s account”, which can contribute to building trust in the scheme. Secondly, it incentivises data collection in conventionally-fueled ships, so that cargo owners can participate in the book & claim system. By promoting data collection in the industry at large, the system can support evidence-based decarbonisation, in addition to downstream efforts at life cycle accounting.

Finally, the system is underpinned by a complex net of auditing and verification requirements. The extent of this compliance burden will be determined in the ongoing development of the scheme.

Ultimately, the MMCZCS Book & Claim system is a promising contribution to the global certification landscape, and will hopefully accelerate the uptake of low- and zero-carbon fuels in the shipping sector. You can read more about the system here. MMCZCS is also encouraging industry feedback on their various publications (form here), and is asking potential pilot program participants to contact the Center ([email protected]). The pilot program is expected to be up-and-running later this year.