Secretary for Transport & Logistics Lam Sai-hung

Climate change has become an inescapable issue that governments around the world must address and the Transport & Logistics Bureau is also sparing no effort in this regard. The maritime industry accounts for about 3% of global greenhouse gas emissions and as mentioned in the Action Plan on Maritime & Port Development Strategy, our Government will proceed in accordance with the emission reduction target set by the International Maritime Organization (IMO), which is to achieve carbon neutrality in the maritime industry by around 2050. Recently, we have introduced two new initiatives to help reduce carbon emissions, taking a crucial step forward in the development of green maritime and green port in Hong Kong.

World’s first CII-related Green Incentive Scheme

The Marine Department launched the Green Incentive Scheme on June 28 this year, the first of its kind in the world that is Carbon Intensity Indicator (CII)-related, to encourage the green transformation of the maritime industry. All Hong Kong-registered ships of 5,000 gross tonnage or above in possession of a valid ”Statement of Compliance - Fuel Oil Consumption Reporting & Operational Carbon Intensity Rating” showing that the ship has attained rating A or B in the CII formulated by the IMO are eligible for the green incentive. Each qualified Hong Kong-registered ship is eligible to receive $20,000 per corresponding year from 2024 to 2026. The Government has earmarked $65 million in the 2024-25 Budget to implement this initiative. The IMO issued a circular letter to all member states on June 27 of the newly implemented Green Incentive Scheme of the Hong Kong Special Administrative Region Government.

IMO Secretary-General Arsenio Dominguez recently complimented Hong Kong for taking a very proactive approach and being the pioneering administration in supporting the IMO’s green shipping policy on the CII during his video speech at a luncheon hosted by the Hong Kong Shipowners Association held earlier this week. Mr Dominguez said that the IMO is calling on its member states to take action and measures to promote the reduction of carbon emissions. He welcomed Hong Kong to share the outcome of relevant experience with the organisation. He also expressed confidence in Hong Kong’s green shipping strategy and was delighted to see that Hong Kong has laid out a clear roadmap to enhance its efficiency and status as a global shipping hub.

Green Marine Fuel Bunkering

In addition, the Shipping Legislation (Use of Fuels & Miscellaneous Amendments) Bill 2024 was introduced into the Legislative Council for first reading last Wednesday. The major goal of the bill is to allow ships to use new fuels other than conventional petroleum fuels in Hong Kong waters, and facilitate the using and bunkering of increasingly prevalent environmentally friendly fuels with less or zero carbon emissions, such as liquefied natural gas (LNG), methanol, ammonia and hydrogen. In fact, there are currently about 500 LNG vessels in operation worldwide, more than 30 methanol-powered vessels in service, as well as over 200 LNG vessels and 130 methanol vessels on order worldwide. We expect the demand for green fuels in the maritime industry will continue to increase and the promotion of the bunkering of green marine fuels for vessels in Hong Kong will help us capitalise on the global trend of emissions reduction in the maritime industry, and maintain the competitiveness of our port.

The bill signifies the initial step of Hong Kong’s efforts to promote the use of green marine fuels. To further expand the utilisation of green fuels across Hong Kong, and to enable vessels to bunker green fuels in the city, it is imperative to establish the necessary supporting infrastructure and regulatory framework. The Hong Kong SAR Government has thus commenced a feasibility study for providing green methanol bunkering for both local and ocean-going vessels, and will promulgate an action plan for the construction of bunkering facilities and development of supply chains by this year, with a view to equipping Hong Kong to leverage the emerging development opportunities presented by green marine fuels, and establish the city as the preferred green marine fuel bunkering centre in the region.

Conclusion

Green shipping represents a burgeoning global trend within the maritime industry. We remain committed to collaborating closely with the industry to foster the advancement of green shipping and green ports in Hong Kong. As we strive to reduce emissions, our goal is to bolster the port’s competitiveness, thereby achieving both environmental sustainability and economic prosperity. This initiative not only aids in solidifying but also enhancing Hong Kong’s standing as an international maritime centre.

Secretary for Transport & Logistics Lam Sai-hung wrote this article and posted it on his blog on July 20.