Avoiding Emissions in Shipping with the Book and Claim Chain of Custody

Emissions avoidance instead of compensation 

As of now, the industry is shifting towards more alternative propulsions and there are a couple of propulsion types being tested at the moment. Albeit the variety of options, most of them are not fully fledged yet. To lead the shipping industry toward decarbonization and to meet our own sustainability goals, we rely on gradually replacing conventional Marine Fuel Oil with biofuel, specifically fatty acid methyl ester (FAME) derived from waste and residues compliant with the Renewable Energy Directive (RED II). However, the effective use of biodiesel depends on availability, as not all routes and ships are equipped to handle alternative fuels yet. 

To address this limitation, we've decided to employ the book and claim chain of custody, a system that allows all customers to avoid shipping emissions globally, regardless of the actual route or vessel used. This approach supports the decoupling of emissions avoidance claims from the physical consumption of biodiesel, offering flexibility and scalability. The book and claim approach is the baseline for our first sustainable solution Ship Green.  

What is the book and claim chain of custody? 

The book and claim chain of custody is not a novelty invented by the shipping industry. It is a widely used mechanism that separates the claim of environmental benefits such as emissions avoidance from the physical flow of the good or service.

A common example is in the electricity sector, where providers produce "green electricity", for example from wind and solar PV, that is fed into a shared grid. While all customers receive the same mix of electricity, the rights to claim the purchase of green electricity are sold separately as so-called renewable energy certificates. 

Similarly, our book and claim chain of custody ensures the emissions avoided by using biodiesel on our specific owned and operated vessels are transparently allocated to customers, even if their shipments travel on vessels running conventional marine fuel.  

Below you can see how the book and claim chain of custody looks like in practice.

Step 1: Physical Biofuel availability 

A vessel such as our very own "Al Nefud" uses biodiesel during a voyage from Rotterdam to Singapore, avoiding a measurable amount of emissions. The bunkered fuel on the “Al Nefud” accounts for 2,000 t avoided emissions. 

Step 2: Claims  

You and other customers can purchase Ship Green for different routes and transport on vessels other than “Al Nefud”, attributing these avoided emissions to the respective transport leg without physical restrictions on the vessel or voyage used.

In our example there is one customer claiming 1,160 t of avoided emissions on the Chennai Express from Southampton to New York. A second customer claims 590 t of avoided emissions on the Frankfurt Express.  

Subtracting both claimed emissions from the available 2,000 t of avoided emissions leaves a remainder of 250 t of avoided emissions to claim. 

Of course, we also have safeguard principles to ensure the integrity of this approach: 

1. Frequent reconciliations: Only emissions avoidance from biofuel that has already been used in our owned and operated fleet is sold to customers. We never sell more emissions avoidance than we have generated.
   
2. No double counting: Each unit of emissions avoidance is attributed to only one customer. 

This flexibility allows Ship Green to cater to customers globally, independent of the logistical constraints of biofuel availability or the ability of the used vessels to bunker with biodiesel. 

Book and claim vs. Offsetting – What is the difference? 

While both options affect emissions and account for a reduction in some sense, the book and claim approach differs fundamentally from carbon offsetting. The main difference is that offsetting is not a direct avoidance of emissions but rather makes up for causing them in the first place. 

1. Direct emissions avoidance: Unlike offsetting, which compensates for emissions by investing in unrelated projects (e.g. by supporting reforestation projects), book and claim ensures emissions avoidance occurs directly within the shipping process through biodiesel use. 
2. Transparency: Book and claim offers clear traceability of biofuel consumption and emissions avoided, verified by reconciling biofuel supply and claims.
3. Scalability: While offsetting often depends on the development of external projects, book and claim leverages existing biofuel use, making it an immediately actionable solution for cleaner shipping. 

Conclusion 

With the omnipresent need for a more sustainable shipping in the future solutions like book and claim are a great first step. It is a convenient solution in regards of usability and actively creates an impact by not only making up for emissions caused but by actively avoiding them in the first place. With solutions like Ship Green you can easily switch to biofuel with just a single click and join us on the journey towards more sustainable shipping – without having to compromise reliability.