There is no doubt that the maritime shipping industry, a silent giant accounting for 2-3% of global carbon dioxide emissions, has long operated under the radar when it comes to climate ambitions. However, a significant wave of change began in April 2018, when the International Maritime Organization (IMO) adopted the groundbreaking IMO Resolution MEPC.304(72), famously known as the Initial IMO Strategy.
This groundbreaking resolution set an ambitious goal to reduce greenhouse gas (GHG) emissions by "at least" 50% from 2008 levels by 2050. So, for logistics, it can be a strong call to further increase this reduction, aiming for a full 100% reduction if achievable. This bold move reflects the spirit of the 2015 UN Paris Agreement and signals a radical shift in the maritime sector, which is now firmly committed to building a greener future.
But as with any monumental shift in net-zero greenhouse gas emissions with renewable energy technologies, questions of marginal cost inevitably arise. This very dilemma echoed in my mind during a visit to Transport & Logistics in Ghent, Belgium, in September 2024, where we were present. Amidst the bustling industrial developments and engaging conversations with leading European transportation companies, a presentation by Philippe Degraef, Director of Febetra.be, from Brussels, truly resonated. His presentation, "Gaan we ons blauw betalen aan de vergroening?" showed the often-overlooked "hidden costs of emissions reductions" of large-scale green energy transitions in transportation, by using electric vehicles to reduce emissions. We give you another way to learn more about this subject and understand better the static costs of a new energy efficiency system in your business.
It all raised a critical question that hangs in the air on sustainable development, are these hidden costs still higher than the familiar burden of fuel consumption, and if they can really save money? Let's delve into the complex financial landscape of carbon emissions reductions.
Why the shift to zero-carbon shipping is increasing costs?
The pursuit of lower emissions in maritime transport, while crucial for environmental sustainability, introduces a complex web of costs. No secret reverberates throughout the global trade system. With the Initial IMO Strategy charting the course, the International Maritime Organization (IMO), as well as the Marine Environment Protection Committee, is actively developing legally binding measures to curb greenhouse gas GHG emissions from ships.
These measures encompass enhanced technical and operational energy efficiency for ships. We all understand that the implementation of low- and zero-emission fuels is now a national action plan in many EU countries and far beyond. Market-based mechanisms like carbon pricing all contribute to a fundamental shift in the processes of emissions from international shipping.
These reducing GHG emissions from ships primarily impact two key components of maritime transport marginal cost, such as voyage costs, capital costs, and carbon pricing. Understanding these cost drivers is paramount for comprehending the ripple effect on global trade. Let's take a closer look.
Capital costs
It's about ship design and technical adjustments. Over the mid to long term, significant capital investments will be required for the design and technical specifications of ships. This includes modifications for improved energy efficiency. Moreover, retrofitting for new fuel types or constructing entirely new vessels that meet stricter emission standards is necessary.
Voyage costs
In the short term, we're talking here about increased fuel expenditures. So, the just and equitable transition to alternative, more environmentally friendly marine fuels or the implementation of carbon pricing mechanisms can directly elevate fuel expenditures for each voyage. This is very analogous to a direct increase in the price of conventional fuel.
Carbon pricing
The carbon price burden is further down the road. The long-term burden of paying carbon prices. So, whether through direct taxes, emissions trading schemes, or other market-based measures, it will also fall under capital costs. Because it all represents an ongoing financial commitment tied to a ship's operational life.
Rising maritime transport costs and future energy options for shipping
The potential ramifications of these increased maritime transport costs are multifaceted and could lead to several negative factors.
We recognize that maritime transport faces reduced competitiveness. Higher shipping costs might diminish the competitiveness of sea freight compared to other modes of transport (e.g., rail, road, air), potentially leading to a shift in cargo away from shipping.
Increased import prices mostly boil down to higher shipping costs. And in the long term, it would translate into increased prices for imported goods. This, nominally, could encourage local production or necessitate the search for alternative sourcing options. So, we may say from some point that cost may have a positive impact, but not least.
As the international maritime industry and shipping industry grapple with rising costs and the imperative to decarbonize, identifying viable alternatives to conventional fossil marine fuels has become critical. Emerging fuel production technologies offer diverse pathways to reduce global greenhouse gas emissions, improve energy efficiency, and meet international climate targets.
Several studies have identified the leading contenders in this race towards a zero-emission future:
Battery electrification. For shorter voyages and specific vessel types, direct electrification through batteries offers a promising pathway to net-zero emissions shipping.
Biomass-derived fuels. These zero-emission fuels, sourced from sustainable biomass, could play a partial role, though their large-scale availability to meet the IMO's ambitious targets remains a challenge.
Synthetic fuels. This category, including alternative fuels derived from electricity and renewable feedstocks, like ammonia green fuels and hydrogen-based fuels, or fossil marine fuels coupled with Carbon Capture and Sequestration (CCS), appears to be among the most competitive options currently.
In summary, while the energy transition to alternative zero-emission fuels presents cost, scalability, and infrastructure challenges, it also offers an opportunity to reshape emissions from international shipping toward a more sustainable and competitive future. By adopting innovative energy efficiency solutions, the maritime shipping sector can offset rising transport costs, maintain international shipping trade competitiveness, and contribute significantly to the world’s decarbonization goals.
Technology-driven approaches to sustainable transportation
The global imperative to mitigate climate change and global warming necessitates a targeted approach to decarbonization, with the transportation and shipping sector emerging as a critical focus. In 2021, transportation stood as the most fossil fuel-dependent end-use sector, contributing a substantial 37% of total carbon dioxide (CO2) emissions. This challenge is compounded by the sector's rapid growth, with emissions increasing at an annual average rate of nearly 1.7% from 1990 to 2021, outstripping all other end-use sectors.
Within the transportation landscape, distinct sub-sectors contribute varying degrees to overall emissions. Data from 2024 reveals road vehicles as the predominant source, responsible for a significant 74% of global transportation CO2 emissions. Following closely, global shipping accounted for 11% and aviation 10% of the sector's total CO2 emissions. In contrast, rail and pipeline transport were considerably less carbon-intensive, contributing 1% and 4% respectively.
Below, we outline three technology-driven approaches to lower emissions-related costs, from fully custom platforms to hybrid and existing solutions.
1. Fully custom solutions
A fully custom software solution provides a tailored platform developed to address emissions at every stage of transport and logistics operations. Adexin creates end-to-end systems that help carriers and logistics firms track, model, and achieve emissions reduction targets across road, rail, sea, and air networks. These bespoke platforms integrate real-time data, predictive analytics, and CO₂ calculators to identify the most efficient and least carbon-intensive routes. They also evolve over time, ensuring compliance with regulations and keeping operations ahead of maritime industry and global shipping industry standards. While this approach delivers full alignment with sustainability goals, a competitive edge through precise emissions insights, and long-term cost savings, it requires a higher upfront investment and a longer implementation period compared to off-the-shelf tools.
Our portfolio cases facilitate the adoption of sustainable practices across all transportation sub-sectors and the maritime sector, including the recent EcoTransIT-based CO₂ calculator. Building on this commitment, we partnered with Green Worldwide Shipping. This solution enables precise CO₂ estimations for complex, multimodal transport routes across sea, air, rail, and road. The project’s goal was to modernize an outdated calculator by redesigning its UX/UI to be intuitive, visually engaging, and efficient, even for multi-leg journeys.
Key features include smart location suggestions, streamlined input flows, and responsive route building. Users can now calculate emissions in under two minutes, while the scalable architecture supports future growth and reduces technical overhead and support requests. Ultimately, the tool helps reduce emissions-related costs by avoiding inefficient routes, optimizing multimodal choices, improving planning accuracy, and lowering compliance and reporting penalties.
2. Hybrid solutions
Hybrid solutions combine custom emissions-tracking features with existing logistics platforms. By extending current transport management or ERP systems, companies can add CO₂ estimation tools, multimodal optimization features, and compliance dashboards without replacing their core systems. This approach delivers faster time to value by introducing only the features needed, such as smart location suggestions, enhanced reporting, or responsive route planning.
Hybrid solutions are generally more cost-effective than fully custom builds and can scale as regulations or business needs change. However, they require careful integration to prevent data silos and may still take longer to roll out than ready-made solutions alone.
3. Existing solutions
Using existing solutions offers a fast and straightforward entry point into emissions management. Companies can adopt pre-built (carbon dioxide) CO₂ calculators or route optimization software to gain immediate insights into their emissions data. Established vendors provide ongoing support, regular updates, and compliance improvements, making these tools reliable and widely tested.
This approach allows for quick implementation and lower upfront costs but comes with limited customization options and may lack advanced analytics or multimodal capabilities compared to custom or hybrid solutions.
Transforming transportation operations for a greener future
As regulatory pressure mounts and sustainability becomes a core business priority, transportation providers face a choice like continue with outdated processes or embrace smart, technology-driven solutions. Every day of delay increases costs, operational inefficiencies, and exposure to compliance risks. The path you take today will determine both your environmental impact and your financial performance tomorrow.
In today’s rapidly changing regulatory and economic landscape, postponing action on global shipping emissions reduction and transportation optimization carries real financial risks:
Relying on outdated tools like Excel spreadsheets can cause costly delays and expose your company to mounting penalties as regulations tighten.
Uncoordinated routes, schedules, and vehicle utilization often mean spending 1.5 to 2 times more than necessary on transportation, directly affecting your bottom line.
Implementing ill-fitting software isn’t just a wasted investment, it can create a fragmented system that fails to deliver meaningful, long-term improvements.
Contrast this with a technology-driven, integrated approach:
Dispatchers and drivers receive real-time status updates on a single, intuitive platform, eliminating communication gaps and guesswork.
Managers are instantly alerted when issues arise, enabling proactive problem-solving before small problems escalate.
Executives gain access to comprehensive performance dashboards, giving them the insights needed to make data-driven decisions that drive strategic growth.
Investing in the right technologies today isn’t just about compliance, it’s about creating a resilient, future-ready transportation operation. Companies that implement integrated maritime emissions and fleet-management solutions gain measurable cost savings, operational efficiency, and the agility to thrive in a low-carbon economy. Waiting may seem easier, but in reality, the cost of inaction is far higher than the investment in smart, scalable solutions.
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Contact usFinal takeaway
The maritime and transport shipping sectors are at a pivotal crossroads. Rising regulatory pressure, evolving energy efficiency technologies, and the urgent need for carbon reduction make it clear that maintaining the status quo is no longer an option. Embracing smart, technology-driven solutions, from fully custom platforms to hybrid and ready-made tools, enables companies to reduce greenhouse gas emissions, optimize operations, and safeguard long-term competitiveness.
The journey to carbon maritime emissions reduction targets and optimized logistics starts with a conversation. We're ready to help you navigate this complex landscape and deliver custom transportation solutions that fit your business. Let’s discuss your logistics processes, draft a technical approach, and build a timeline tailored to your needs, so your operations are greener, more efficient, and future-ready.