Why a Circular Transition?

During its lifetime a ship will be designed, built, operated, and eventually dismantled – a textbook example of the linear economy.

A ship is designed with particular consideration of projected market needs. Compared to other transport sectors, the design of a ship is determined by the first (ship-)owner rather than the builder (shipyard). Standardised models are available at times, but mostly ship-owners take a rather customized approach, resulting in a large variety of ship types, sizes and configurations. This means that most ships are designed and built as one-offs, leaving little room for modular innovation in the design process and for efficient re-use of materials in the later stages of a ship’s life. This is partly due to the specific power and operational requirements of maritime vessels, but also due to the general challenges around innovation in the maritime sector. Meanwhile, when it comes to effective end-of-life management, ship-breaking globally is a dirty and dangerous industry, mainly occurring on the beaches of South Asia.

Little attention is currently paid to circular principles

During its lifetime a ship will be designed, built, operated, and eventually dismantled – a textbook example of the linear economy.

Considering the novelty of circular thinking applied to the maritime context, it is perhaps not surprising that little attention is paid to circular economy principles in both the building and operating phases of a ship’s lifecycle. For shipping, the transition to circular life cycles entails reimagining the entire value chain, from a ship’s design to the re-use of its parts and its end-of-life management. An overview of what such a transition may look like is shown in the diagram below:[1]

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Necessary focus on modularity and standardization in ship-design

In the design phase, we believe the central focus should be on modularity and standardization. Modularity will help accelerate innovation as adoption of new technologies is no longer delayed by the design and construction of a new vessel. Instead, a module can be replaced and the vessel can be returned back into operations. Standardization will enable ship-design modules to be re-used across application cases and can save costs during the transition that is required across vessel types and bunkering facilities. Adopting circular economy principles requires a systemic shift in thinking. Instead of optimising individual parts of a system, the system must be acknowledged in its entirety.

In practice, this means considering the implications of a decision for all stakeholders and activities within the system, and finding solutions to problems as early as the design phase. An overview of the relevant stakeholders in each phase of a ship’s lifecycle is presented in the image below: [2]

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In later lifecycle stages: focus on steel and re-use of raw materials

Steel is usually the primary material from which ships are made, and provides an excellent foundation for connecting the shipping industry to the principle of circularity. Considering that steel often makes up between 75-85% of a vessel, it is not only the primary material but also the primary driver of price for a vessel sold for recycling. However, it is the other materials, including a tiny (but harmful!) percentage of hazardous materials that makes dismantling a challenge. This small percentage of a ship’s composition leaves a huge environmental footprint if not properly managed.

We believe this challenge also offers a huge opportunity, offering a valuable source of raw materials that can be recovered from vessels at the end of their economic life. For instance, ‘urban mining’[3] is a great opportunity in a world of growing resources shortages,[4] where we should no longer depend on resources that are unsustainably mined from the ground. Instead, the world’s floating tonnages form a valuable resource that can and should be the base of our future fleet. Momentum around this opportunity is increasingly building through regulatory developments as well. The IMO Hong Kong Convention and EU Ship Recycling Regulation require the development and upkeep of inventories for hazardous materials on-board ships for the entirety of the ships’ life. This ensures traceability and accountability across the lifecycle, but recent regulations are even more explicitly circular.  The EU’s Circular Economy Action plan and the new Green Deal proposals are pushing for circularity and re-use in all industries, including shipping. In fact, one of the key considerations of the recent Communication on a Sustainable Blue Economy in the EU emphasized the need to “work to mitigate the impacts on oceans and coasts to build a resilient economy model based on innovation, a circular economy and a respectful attitude to the ocean.”

These regulatory pushes indicated that a sustainable shipping industry needs to consider its impacts on oceans, as well as on the communities and people who depend on it. Together with partners, THRUST is building a venture based in precisely these principles, looking beyond the goal of zero-emission, to an entirely zero-footprint sector!

[1] Sustainable Shipping Initiative, ‘Exploring shipping’s transition to a circular industry’, diagram by 2BHonest, pg 9.

[2] Sustainable Shipping Initiative, ‘Exploring shipping’s transition to a circular industry’, diagram by 2BHonest, pg 9.

[3] Fraunhofer ISI Report, ‘The promise and limits of Urban Mining’

[4] The Diplomat, ‘The Potential of Urban Mining’

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