Challenges in smart green shipping

Smart green shipping: Powering up Caroline Pradier and Emily Morrison December 2020

Shipping can have a destructive impact on the environment, from pollution, to emissions and waste. However data, communication and automation technologies have the potential to revolutionise the industry and help the shift to a new era of smart green shipping.

• The data, communication and automation technologies that will revolutionise shipping – ShipTech – is worth $100 billion today according to Inmarsat.

• The sector is set to grow to be worth $278 billion by 2030.1

Our vision By running a challenge prize we hope to help transform a polluting, legacy industry into a clean, tech and data-driven sector. We would like to see a challenge prize supporting innovative SMEs to break into an industry that is currently dominated by big players. The prize would help showcase their innovations and also raise their profile. We want to see advanced data science and artificial intelligence (AI) at the heart of the innovations.

We would also hope to work in partnership with a UK port or ports and use it as a testing and demonstration facility. This would be a good way to recreate a link with the public by showcasing the clear benefit through reduced carbon emissions and improved air quality.

Smart green shipping: Powering up

The challenges and their context The maritime industry is part of a slowly modernising global logistics system. The industry operates around 50,000 ships that serve the entire global economy. It is the ultimate legacy infrastructure which, with no obvious substitute, is almost impossible to move away from.

At the same time, the UK has agreed to halve greenhouse gas emissions from the shipping industry by 2050 compared with 2008 levels, in accordance with the IMO GHG Strategy.2 This policy will have a transformative effect on the shipping industry worldwide.

A data-powered revolution is sweeping the sector – making shipping smarter and greener: better serving today’s complex supply chains while meeting climate change targets. It could help make supply chains more resilient too, a key concern exposed by the coronavirus pandemic.

This is a clear growth area – ShipTech is already worth $100bn today and is forecast by Inmarsat to grow almost threefold by 2030.3, 4 Meanwhile, SMEs’ role in this market is growing fast, but from a low base of just 4 per cent of the technology market, and there is a clear opportunity for British firms to capture a share of this.

Britain has already taken steps in this industry, through the DfT’s Maritime 2050 strategy and its commitment to innovation in the sector. Funding has subsequently followed, with the creation of the Maritime Autonomy Regulation Lab (MARLab) and a Clean Maritime Innovation funding call.5

The role of innovation A challenge prize on smart green shipping could provide a UK port as a testbed – and invite the UK’s innovative SMEs to test out solutions for more efficient handling and routing of freight – rewarding the innovation that is most effective at cutting costs and carbon emissions.

The port of Rotterdam has already experimented with a smart port system, with sensors providing information on available docks, flows of goods and local weather. However, this has not tested new fundamental technologies.

Challenge prizes are potentially a valuable tool for supporting these breakthrough innovations, offering financial incentives for teams to develop technologies and services that meet specific goals.

In technology focussed sectors like shipping, our research shows that challenge prizes have effects far beyond the incentive alone. We have found that they: • Help galvanise action around a shared vision: by setting strategic objectives for the UK maritime sector they could help focus attention on particular gaps or opportunities.

• Help give credibility and visibility to teams working on them: by signalling government support and independent validation, they could help attract publicity and investment to teams taking part.

• Help demonstrate the benefits of technologies developed: by building in demonstrations into the judging of the prize, as well as showing the use of the technologies in certain testbeds (such as UK ports), prizes could help demonstrate and drive adoption of the innovations created.

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Smart green shipping: Powering up

Opportunities for challenge prizes One of the UK’s key strengths is in small hardware and communications companies that could play an important role in how data is collected and analysed in the maritime industry.

For example, new combinations of internet-of-things and satellite-led low-power wide-area networks (LPWAN) systems offer monitoring and tracking solutions that could meet the needs of the industry on and off-shore. RFID tagging is also being used to track consumer goods as they move through the supply chain. There are also efforts to use distributed ledgers for tracing, logistics management and trade finance.6 Although the challenge prize could focus on a number of different aspects of smart green shipping, some examples of challenge prizes in this area could include:

• Create and pilot a new technology that would enable a doubling of throughput at the testbed port over a period of 24 hours.

• Create and pilot a new technology that would enable completely autonomous loading and unloading of containers.

• Create and pilot a new technology that would enable significant environmental improvements from shore side powering.

• Create and pilot a new system that utilises digital twinning technology to improve the environmental impact of the testbed port.

Endnotes 1. Inmarsat. ‘Landmark Inmarsat Study Identifies Critical Role for Maritime Startups – News.’ Accessed July 3, 2020. https://www.inmarsat.com/news/landmark-study-identifies-critical-role-for-maritime-startups 2. Department for Transport. Clean Maritime Plan. https://assets.publishing.service.gov.uk/government/uploads/ system/uploads/attachment_data/file/815664/clean-maritime-plan.pdf 3. Inmarsat. ‘Landmark Inmarsat Study Identifies Critical Role for Maritime Startups – News.’ Accessed July 3, 2020. https://www.inmarsat.com/news/landmark-study-identifies-critical-role-for-maritime-startups 4. Chubb, Nick, and Leonardo Zangrado. ‘Trade 2.0: How Startups Are Driving the next Generation of Maritime Trade.’ Inmarsat Research Programme. PUBLIC, September 2019. https://www.public.io/wp-content/ uploads/2019/09/Trade-2.0-PUBLIC.pdf 5. ‘Department for Transport Launches the £1m Clean Maritime Innovation Call.’ KTN, July 30, 2019. https://ktnuk. co.uk/news/department-for-transport-launches-the-1m-clean-maritime-innovation-call 6. UCL Centre for Blockchain Technologies. ‘Distributed Ledger Technology in the Supply Chain.’ Accessed December 4, 2020. http://blockchain.cs.ucl.ac.uk/wp-content/uploads/2019/08/DLT-in-the-Supply-Chain_UCLCBT.pdf

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Smart green shipping: Powering up

Further information Nesta Challenges Nesta Challenges exists to design and run challenge prizes that help solve pressing problems that lack solutions. We shine a spotlight where it matters and incentivise people to solve these issues. We are independent supporters of change to help communities thrive and inspire the best placed, most diverse groups of people around the world to take action.

We support the boldest and bravest ideas to become real, and seed long term change to advance society and build a better future for everyone. We are part of the innovation foundation, Nesta. A full list of our current challenge prizes is available on our website at www.challenges.org

To discuss the content of this challenge brief, contact: Caroline Pradier, Assistant Programme Manager, Nesta Challenges caroline.pradier@nesta.org.uk Emily Morrison, Researcher, Nesta Challenges emily.morrison@nesta.org.uk

58 Victoria Embankment London EC4Y 0DS +44 (0)20 7438 2500 challenges@nesta.org.uk @NestaChallenges www.challenges.org Nesta is a registered charity in England and Wales with company number 7706036 and charity number 1144091.

Registered as a charity in Scotland number SCO42833. Registered office: 58 Victoria Embankment, London, EC4Y 0DS.

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