Developing nations’ port decarbonisation challenges

A comprehensive study conducted by Maritime & Transport Business Solutions examined the current state of port adaptation and decarbonisation infrastructure, featuring case studies from Brazil, India, Indonesia, Kenya and the Solomon Islands.

The study indicates a substantial investment need for ports in developing nations, estimated between US$55 billion and US$83 billion. It reveals that these ports typically prioritise adaptation investments over mitigation efforts.

This trend is particularly evident in smaller, vulnerable ports, such as those in Indonesia and the Solomon Islands. The report highlights the challenge that adaptive measures, like storm barriers, often lack an economic business case, focusing instead on averting future losses.

“Tackling climate change in the maritime industry means adopting both adaptation and mitigation measures in ports,” said IAPH managing director Patrick Verhoeven. “Adaptation is focused on keeping the ports trading and making sure they are protected against the onslaught of extreme weather disruptions.

Mitigation entails investing in infrastructure improvements to reach net-zero GHG emissions as soon as possible. Only through a combination of both actions can ports build resilience and secure their future.”

Key conclusions from the report include:

• Securing funding for port infrastructure remains a significant hurdle. Most viable projects require a dual focus on delivering socio-economic benefits to the region while presenting a solid business case to attract investment.
• Developing nations have an opportunity to harness renewable energy sources such as solar and wind. Notably, green hydrogen produced from these renewable sources is positioned as a key alternative to fossil fuels, enabling countries to produce, use, and potentially export clean energy to high-demand markets.
• The maritime sector must quickly establish a consensus on regulatory frameworks and greenhouse gas mitigation measures to avoid risk aversion from investors in emerging technologies that may not achieve widespread adoption.
• Funds generated through market-based measures must be allocated based on various factors, including the level of dissemination (country, port, project), the vulnerability to climate change, the region’s dependence on maritime transport, and the economic benefits associated with different cargo types. Additionally, considerations regarding food security, adaptation needs, cost-effectiveness and overall socio-economic impacts are crucial.

As the IMO Working Group on Reduction of GHG Emissions from Ships (ISWG-GHG 17) convenes this week to discuss mid- and long-term measures, IAPH says it remains neutral regarding specific strategies.

However, it advocates for a carbon-pricing mechanism to incentivise investment in essential port infrastructure. Such measures are vital for enabling the commercial viability of low- and zero-carbon fuels and ensuring a just and equitable transition to sustainable practices in the maritime sector, it says.

“The risk of a market-based measure increasing transport costs, which places added pressure on countries with lower efficiency infrastructure and less connectivity to the global trade network, could be offset by the potential revenues allocated to them for port-related adaptation and mitigation measures to kick start the energy transition,” said Verhoeven.