Slush, the world's leading startup event, took place once again in Helsinki last week, and as a contemporaneous side event, the Breaking Waves conference served to introduce the way forward towards the digital future of shipping and maritime logistics. Amid the melting pot of ideas, innovations, and new business concepts which comprised the event, SEA20 made a lasting impression upon the participants.
With its potentially catalytic effect upon the world’s major cities’ use of renewables, environmentally friendly solutions, automation and smart data, SEA20 established itself as a noteworthy assembly, as well as an opportunity for real change to occur in the marine and energy industries.
Discussion around the organization and the issues it seeks to address found its way to the lips of many of the decision makers present, awakening interest and fueling discussion.
A carbon-neutral Europe
Keynote speaker Alexander Stubb, former Finnish Prime Minister and current Vice President of the European Investment Bank (EIB), went as far as to mention SEA20-enabler Wärtsilä in his address. When speaking to SEA20 representatives, he was very clear about the necessity of the marine and energy industries to adapt to the coming changes:
“I myself have spoken, by-and-large, of having a carbon-neutral Europe by 2045,” he stated. “The Commission speaks of 2050. I think it’s doable and I think it’s usually the case, with these types of disruptive changes, that once the ball starts rolling they actually happen quite fast. So you have to prepare for it.”
When asked about free trade as a driver for development in the marine industry, particularly in response to Dr Liam Fox’s (UK Secretary of State for International Trade) ‘UK Ports for International Trade’ campaign, Stubb observed that Brexit poses challenges to the rapid change desired:
“It is a little bit ironic that a British minister is proposing this, while at the same time, they are leaving the biggest free-trading block of the world. And, of course, free trade will be much more difficult for the United Kingdom in the future than what it is right now inside the European Union. And I say this as a former trade minister, it’s just completely impossible to start to do bi-lateral trade agreements when you have the biggest entity doing it for you.”
And in terms of climate change mitigation, Stubb takes a firm view of Europe as a potential technological saviour:
“I always look at things from a European perspective,” he said. “We emit about 9-10% of CO2 emissions worldwide, so we are not going to be the problem. But we can be the solution in terms of providing technological development that leads us towards a more energy efficient, cleaner, climate-friendly future. And I think that is what Europe should work on. Of course, because throughout history we have been the big polluters and in the future we are not. But we can try to save the world by providing the technology.”
Technology bridging the gaps
The key role that cities have to play in industrial transformation was also acknowledged. Jens Meier, CEO of the Port of Hamburg – whose city is a founding member of SEA20 – discussed the value of cross-stakeholder collaboration in this regard:
“Many people do not understand that when you are able to avoid traffic jams, you are able to reduce the carbon footprint,” he said. “Harmonizing operations benefits everyone. When stakeholders partner up, everyone can benefit... The main thing is that we are all heading in the right direction and we increase momentum in the right direction.”
Harmonizing the global shipping industry, of course, is a highly complex operation, taking in a variety of actors across the value chain. To create a truly ‘smart’ ecosystem, a great deal of collaboration must take place, which in port operations may require transparency and data-sharing among competitors. Does Meier see trust issues as a challenge here?
“If you have trucking companies like Mercedes, Volvo and Man, for example, and you want to implement ‘clever’ transportation on a normal motorway, you’re looking to implement platooning,” he explained. “For that to work, these different truck producers must find a way to communicate with each other, otherwise they cannot platoon in an automatic-drive mode. Without connectivity, they cannot play together.”
“The same goes for us,” he continued. “We might have three big alliances on the shipping side. When a company suddenly jumps from one alliance to another, then the containers they are carrying may suddenly find themselves in the wrong container terminal. Therefore, I think that all the ports should keep an eye on transparency and share all this data in a way. This does not necessarily mean that they all need to use the same system. I think that ports need one communication platform to which all the different systems can plug into – a way to aggregate and share data from multiple platforms.”
More questions than answers
In conversation with a SEA20 representative, Dr Martin Stopford, President of Clarkson Research, enumerated the challenges facing the marine industry, poised on the brink of tremendous change which will also demand significant investment:
"A lot of ships are what you call custom-built. Unlike planes, which are built to particular models. The ships are generally built to the customer’s order. They are similar but not the same and the equipment is not the same. That means you are dealing with a highly-varied physical structure of the business. Put those together and, well, nobody likes change either!”
He envisions the immediate future of the industry as a process of clarification and standardization, as the mass of newly available technologies becomes gradually absorbed into our fleets:
“My philosophy is that you need to look at the ship and redesigning the in-board systems,” he explained, “in the same way that car manufacturers have done, so that you get more streamlined, integrated units that work better, are more reliable, have a higher degree of automation.”
He then turned to the operating model: “Then you need to look at the ways fleets of ships operate – trying to run a fleet of ships like a transport factory. This is, in fact, a very new concept, because you are trying to maximise the return on a whole fleet of assets and using digital technology to make them flexible, interchangeable, and to give you strong information about the performance of every ship in the fleet in many areas.”
Finally, Dr Stopford sees decarbonisation of shipping as an absolute necessity by the end of the century: “We don’t have any naval architectural marine engineering on the scale to make a significant impact but we can reduce the carbon footprint very substantially by being more careful about what we carry by sea. So, we should probably not carry so much cargo in the future by sea, relatively speaking. We may carry more, but not as much as we would have done. Secondly, we move slower. Slow steaming can save a lot of carbon. And then we should look at a new power source. And hydrogen is probably the only good bet within the next 20 years.”
With stakeholders across the spectrum expressing their interest in SEA20 and the aims of its member cities, it is manifestly clear that the time for such discussions is now. The innovation embodied by Slush and the start-up community will evidently play a key role in the development of the marine industries and the urban landscape.