The First Major Marine Contractor to go Carbon Neutral

Society and industry are demanding a less carbon intensive and  more sustainable future. The Paris Agreement, signed in 2016, is resulting in tangible laws and regulations on national and international levels. These deliver substantial targets for 2020, 2030, and 2050 to reduce carbon emissions. The Dutch government has set ambitious targets for 2050, aiming to reduce greenhouse gases to be comparable with levels measured in 1990.  Whereas, the European Union has the goal to reduce emissions by 40% by 2030. This will be an effort shared by the EU countries as a group and it is stated that all sectors need to contribute.

This includes the marine industry and the IMO has set a target for a 50% reduction of carbon emissions for all of its members by 2050. Today the shipping industry produces 3% of total global emissions and represents 10-15% of local air pollution. Therefore, it is unsurprising that the industry is committed to action and some clients of Heerema already aim to be climate neutral by 2050.

At Heerema, we believe that a responsible company has the obligation to behave in a sustainable manner. Which is why we choose to act sustainably, not because we have to but because we want to.  In order to move from these values to actions we use the UN Sustainable Development Goals (SDGs) as our guiding principle. The SDGs are the blueprint for achieving a better and more sustainable future for all. They address the global challenges we face, including those related to poverty, inequality, climate, environmental degradation, prosperity, and peace and justice. The Paris Agreement, IMO Policy, and the SDGs provide a framework for long-term policy planning. They serve as a guideline for sustainable development, that aims to secure a more equitable and sustainable global future by addressing challenges related to poverty, inequality, climate, environmental degradation, prosperity, justice, and peace.

Sustainability within Heerema means creating value by providing services that deliver economic, environmental, and social worth. Being a sustainable company creates business opportunities; our projects will reduce cost, reduce waste, and naturally reduce our environmental footprint. In other words, it is all about the triple bottom line: ‘People, Planet, Profit’.

As a responsible contractor in the offshore industry, Heerema aims to be part of the solution and to be a role-model in terms of sustainability. This begs the questions: How does Heerema deal with these challenges? What is Heerema’s plan to become a carbon neutral company

Before diving into Heerema's strategy, let us first have a look into the current carbon footprint of Heerema as a company.

Paris Agreement

 "An agreement on climate change, emissions mitigation, adaption and finance"

UNSDGs

"The blueprint to achieve a better and more sustainable future for all"

IMO 2050

"A minimum of 50% CO2 reduction for the marine industry by 2050"


Current Carbon Footprint Heerema

Heerema produces carbon emissions depending on the amount of offshore projects that are executed for clients. Heerema’s carbon emissions are mainly caused by the combustion of fuel in its vessels, which has traditionally been ultra-low Marine Gas Oil and with the Sleipnir also Liquified Natural Gas (LNG). This section will establish an average, a ‘baseline’ if you will, of carbon emissions produced by Heerema to estimate the amount of carbon that needs to be offset to be a carbon neutral company.

There is a minimum energy required for vessels that are not performing any activities, but necessary in order to maintain day-to-day operations. This is known as the ‘hotel-load’ and it uses a minimum amount of necessary energy to power base functions, such as air conditioning, lighting, kitchen appliances, etc. The hotel-load can either be expressed in [MW] or [kWh/day] and converted into the minimum amount of fuel required to operate the vessels’ basic functions. This can be used to calculate Heerema’s carbon footprint if the vessels remained in hotel-load for one year.

The hotel-load can be combined with the historic yearly fuel consumption that also includes projects and activities. The resulting overview shows the amount of emissions due to the hotel-load of all vessels combined with the emissions due to the execution of projects. This overview demonstrates that Heerema's carbon footprint from its vessels is between approximately 180.000 [mT] and 240.000 [mT] CO2 per year.

The more conservative value of 250.000 [mT], called the 'baseline', is adhered to for further reference. Roughly 40% of total emissions - 90.000 [mT] - are due to hotel-load only. This is the situation where Heerema does not perform any projects or activities and the vessels are idle. The additional 60% - 110.000 [mT] up to 150.000 [mT] - does include projects and activities.

At the moment, the focus is on ‘Scope I and II emissions’. Scope I emissions are related directly to the activities and operations Heerema performs offshore with the Sleipnir, Thialf, Balder, Aegir, Kolga and Bylgia. Scope II emissions are related to the purchase of energy (electricity) in our offices. 

Scope I emissions for Heerema include emissions due to combustion of fuel from the Sleipnir, Thialf, Balder, Aegir, Kolga and Bylgia, as well as gas usage of all Heerema offices and Flushing yard. These are currently 202,303 [mT]. Methane slip from Sleipnir is not (yet) included in these figures. The exact impact is now being verified, and expected to be in the order of 15.000 [mT].

Scope II emissions are emissions from electricity use in all Heerema locations. These locations are the Flushing Yard, Houston-, London- and Singapore office. All their emissions combined are estimated at 2,367 [mT] at the moment, but are under review and are subject to change. As can be seen however, scope II emissions are close to 1% of Scope I emissions and will not significantly influence the ‘baseline’ of 250.000 [mT]. Furthermore, it should be noted that  Scope II emissions are based on ‘location-based’ emissions, even in the case of the Leiden office where green power from Vattenfal is used. 


Heerema Carbon Neutral Strategy

Becoming carbon neutral is achieved by means of prevention, reduction and compensation of carbon emissions, each with a set target. Heerema will begin by investing in carbon offsetting projects that align with its mission to create sustainable value(s). These will be certified carbon reduction projects that are already in development with the accredited Climate Neutral Group. By the end of 2020, Heerema will begin offsetting 100% of its existing offshore carbon footprint, equaling roughly 250,000 metric tons of carbon per year. From this starting point, Heerema has set yearly prevention and reduction targets.

The ultimate goal is to be carbon neutral using zero-emission technology where feasible, removing emissions from the source and not offsetting them. Offsetting of carbon emissions will occur after 2025 only if so required to remain carbon neutral.

Prevention measures are classified as those that prevent the combustion of fuel in order to generate power. Several initiatives are already ongoing, such as Shore Power Calandkanaal, improved crane utilization, and an improved power management system for the Thialf. Additionally, the Heerema main office is BREAAM certified and uses Dutch wind power for electricity. Therefore virtually eliminating Heerema employees’ carbon footprint in the main office. It is estimated that approximately 25% of Heerema’s total carbon emissions can be prevented, most of which will come from hybridization and Shore Power.

Reduction measures are classified as those that reduce the amount of fuel required, use a cleaner fuel or increase combustion efficiency (improve specific fuel consumption). An example is the use of synthetic diesel-fuels or biofuels such as GTL and HVO. Potentially even hydrogen can be used in co-combustion in the engine. Energy recovery measures, such as heat recovery from exhaust gases, are also included. An important and successful initiative already undertaken by Heerema is the usage of LNG for the Sleipnir, which significantly reduces local emissions such as NOx, SOx, and Particulate Matter (PM). It is estimated that up to 55% of carbon emissions can be reduced, mainly by using alternative fuels such as biofuels. 

Compensation measures are classified as those that offset, capture or otherwise neutralize carbon footprint, other than prevention or reduction. Heerema will begin by investing in carbon offsetting projects that align with its mission to create sustainable value(s). These will be certified carbon reduction projects that are already in development with the accredited Climate Neutral Group. By the end of 2020, Heerema will begin offsetting 100% of its existing carbon footprint, equaling roughly 250,000 metric tons of carbon per year. The amount of offsetting required to remain carbon neutral is gradually reduced as prevention and reduction measures increase. It is estimated that the remaining 20% of emissions will need to be compensated, preferably by means of carbon capture and storage on-board Sleipnir. 



Carbon Neutral Timeline

The amount of carbon emissions that is prevented, reduced and compensated changes over time.

All Heerema emissions (250.000 mT) will be fully offset starting in 2020. It ensures we are carbon neutral today, without having to wait for 2025. One of the reasons to do this, is that there is no technical and economically viable alternative for making our vessels fully carbon neutral today. Furthermore, with a yearly offsetting target, the incentive to reduce emissions is monetized and become tangible for everyone. Finally, the offsetting projects will not only compensate for carbon emissions, they contribute to the United Nations Sustainable Development Goals and help people.

At the same time, investments are made in zero emissions technology from the period 2020 onwards to remove emissions from the source. The role of prevention and reduction steadily grows over time, as these truly remove emissions from the source. . Though each year has set targets for prevention and reduction, the effectiveness of zero-emission technology over the next five years cannot be determined in advance. The exact targets and projects will change over time, as we gain more insights along our journey. 



Carbon Neutral Roadmap

Multiple initiatives have been identified that prevent, reduce and compensate carbon emissions. For prevention and reduction projects, these are so-called 'zero-emission technologies' to remove emissions from the source permanently. For compensation, these are offsetting and carbon capture and storage technologies mostly. When combined with the compensation projects, these result in a tangible carbon neutral roadmap. 

The initiatives to prevent or reduce combustion of fuel vary per vessel and are consequently customized for each vessel. These measures are based upon several sources, both internally and externally. An important external source is the Literature review by E. A. Bouman, E. Lindstad, A. Rialland, A. H. Strømman, Transportation Research Part D, 2017. 

It should be noted that the presented list of measures is neither final nor perfect. It is a simply a selection of possible measures that reach our goal of eliminating carbon emissions by the source – where technically feasible. The exact measures and implementation of technology will be reaffirmed yearly as more is learned about these technologies. 


Estimated Carbon Reduction of Zero Emission Technologies

An overview of the zero-emission technologies and the amount of carbon emissions they are estimated to save by 2025 is shown below. In the coming years, this figure and the exact savings will change as insights are gained from the carbon reduction projects that Heerema executes. Heerema will rely heavily on a few key technologies, which are the use of on-board batteries, shore power, bio- or synthetic fuels and carbon capture and storage. For each of these technologies, promising feasibility and design studies or even pilots have been performed or are underway for each of our vessels. A possible timeline of implementation for these zero-emission technologies could be as follows.

2020    Shore Power                                                    

2021    Expansion of GTL & Biofuels                            

2022    Hybridization                                                   

2023    Power Management                                        

2024    On-board carbon capture and storage            

2025    Hydrogen         


Questions & Answers

Why start with offsetting in 2020?

We believe in taking action now. The world needs bold leaders to lead the way in reducing offshore carbon emission. Even if some consider this the easy way, at least we act. In addition, the technical and economic challenges of implementing zero-emission technologies on-board our vessels today are virtually unattainable. Furthermore, with a yearly offsetting target, the incentive to reduce emissions is monetized and become tangible for everyone. Finally, the offsetting projects will not only compensate for carbon emissions, they contribute to the United Nations Sustainable Development Goals and help people.

What are the 250.000 metric tons based on?

It is based on a historical baseline from scope I emissions and estimated projections towards the future, shown in the figure and tables below. It should be noted that these numbers are updated when more information on our emission factors becomes available.

Scope I emissions for Heerema include emissions due to combustion of fuel from the Sleipnir, Thialf, Balder, Aegir, Kolga and Bylgia, as well as gas usage of all Heerema offices and Flushing yard. These are currently 202,303 [metric tons]. Methane slip from Sleipnir is not (yet) included in these figures. The exact impact is now being verified, and expected to be in the order of 15.000 [metric tons].

Scope II emissions are emissions from electricity use in all Heerema locations. These locations are the Flushing Yard, Houston-, London- and Singapore office. All their emissions combined are estimated at 2,367 [metric tons] at the moment, but are under review and are subject to change. As can be seen however, scope II emissions are orders of magnitude smaller than Scope I emissions and will not significantly influence the ‘baseline’ of 250.000 [metric tons]. Furthermore, it should be noted that  Scope II emissions are based on ‘location-based’ emissions, even in the case of the Leiden office where green power from Vattenfal is used.

The total sum of emissions from 2019 are then 202.795 [metric tons], which is (even when accounting for methane slip) lower than the total amount of emissions that will be offset, i.e. is 250.000 [metric tons]. The baseline is thus a conservative estimate to ensure all Heerema emissions are accounted for in the future. 

 

**Excludes methane slip from Sleipnir. Exact impact is to be determined, estimated at 15.000 [metric tons].

 **All location-based scope II, except for Leiden where it is market-based. Market-based scope II emissions for Leiden are 23 [metric tons] assuming 8.2 g/kWh.

 

What about Heerema’s Scope III emissions?

Heerema has decided to be Carbon Neutral based on scope I and scope II emissions as per the Greenhouse Gas protocol. Critical in Heerema’s commitment is to achieve absolute yearly reductions of carbon emissions in scope I and scope II. Scope III elements are being looked at and elements may be included until 2025. Ultimately the entire footprint of Heerema, including relevant scope III emissions, will need to be reduced to zero.

What happens when we emit more than the 250.000 [metric tons] of emissions?

Heerema's commitment is to offset its actual emissions. As best we know that these will not be higher than 250.000 [metric tons]. In case of higher emissions these will be offset too.

What happens after 2025?

Heerema aims to fully remove all emissions where technically feasible. The program is evaluated yearly to redefine carbon prevention, reduction, and compensation goals. Compensation of carbon emissions will occur after 2025 only if needed to remain carbon neutral. When more knowledge is gained along the carbon-reduction journey, Heerema will look into Scope III emissions to further reduce its emissions footprint.

Why do you only focus on carbon emissions, and no other forms of pollution and emissions such as SOX NOX or Particulate Matter?

We will. Carbon emissions are simply the main focus, as they can be considered the “trailing” emissions indicative for all other emissions. Where there is carbon, there will be other emissions. Additionally, cleaner fuels (such as LNG, GTL and HVO) will also reduce other emissions and pollution in general. Lastly, there is fixed legislation (by MARPOL and IMO) on the production of SO­X and NOX – and these are therefore capped to a certain extent.

What about methane slip?

We are currently investigating the exact influence that this will have on our carbon footprint, as it is currently not taken into account. From publicly available literature, it can be estimated that it will have a significant impact – between 20% to 50% - on the carbon-equivalent footprint of the Sleipnir when running on LNG. The exact influence on the total Heerema carbon footprint is as of yet unknown however, as Sleipnir started sailing in 2019 the exact amount of methane slip is still to be determined. Estimates on the total carbon footprint are expected to be in the order of 15,000 [metric tons].

Which offsetting projects will Heerema do?

Heerema will invest in the following projects:

·         Renewable Energy projects, including Landfill gas Malaysia CER, VCS or Gold Standard

These small-scale renewable projects support the acceleration of the energy transition. The Landfill gas project in Malaysia captures waste-related methane and other greenhouse gases and turns these substances into clean energy. CO₂ emission reductions will be achieved by two means: by collection and destruction of methane by power generation and displacing an equal amount of electricity generated by power plants connected to the electricity system.

·         Cookstoves Africa, Gold standard

Cookstoves in developing countries, are giving the poorest people in the world access to more efficient cooking. The cookstoves are produced, assembled, and distributed locally. Due to their clever design, these stoves use 50% less wood and produce less smoke than ordinary stoves. Besides improving people’s health, these devices help fight deforestation and reduce the amount of greenhouse gas emissions in the atmosphere, by so combatting climate change.

·         Solar Energy and Mobile Payment Africa, Gold standard

Enables households to switch from high-cost kerosene to affordable, safe, off-grid renewable solar power. The system comes with three LED solar lights, one of which can also be used as a torch, and a solar panel with a smart-charge-control lithium-ion battery. By using this system the indoor air pollution is reduced, access to clean energy is provided, also CO₂ emissions are avoided and cost reduction is achieved.

All projects contribute to the Sustainable Development Goals as well. The following SDGs are incorporated in the projects;

SDG 3 Good health & Well being

SDG 7 Affordable and clean energy

SDG 8 Decent work & economic growth

SDG 9 Industry, innovation, and infrastructure

SDG 12 Responsible consumption & production

SDG 14 Life below water

SDG 17 Partnerships for the goals

Which third-party is accountable for execution of the carbon offsetting projects?

Climate Neutral Group will provide these services (link). Founded in 2002 and based in Utrecht, Netherlands and Cape Town South Africa, Climate Neutral Group is one of the longest established and most recognized providers of carbon management and offsetting services in the market. Climate Neutral Group is founding partner and active member of ICROA (International Carbon Reduction and Offset Alliance) and Bcorp certified.

Which third-party will support in certification?

Climate Neutral Group will ensure all projects are certified against either the Gold Standard or Verified Carbon Standard (VCS). More information can be found on their website

What do you mean by prevention?

Prevention measures are classified as those that prevent the combustion of fuel in order to generate power. Several initiatives are already ongoing, such as Shore Power Caland Canal, improved crane utilization, and an improved power management system for Thialf. Additionally, the Heerema main office is BREAAM certified and uses Dutch wind power for electricity. Therefore virtually eliminating Heerema employees’ carbon footprint in the main office. It is estimated that approximately 25% of Heerema’s total carbon emissions can be prevented, most of which will come from hybridization and Shore Power.

What do you mean by reduction?

Reduction measures are classified as those that reduce the amount of fuel required, use a cleaner fuel or increase combustion efficiency (improve specific fuel consumption). An example is the use of synthetic diesel-fuels or biofuels such as GTL and HVO. Potentially even hydrogen can be used in co-combustion in the engine. Energy recovery measures, such as heat recovery from exhaust gases, are also included. An important and successful initiative already undertaken by Heerema is the usage of LNG for the Sleipnir, which significantly reduces local emissions such as NOx, SOx, and Particulate Matter (PM). It is estimated that up to 55% of carbon emissions can be reduced, mainly by using alternative fuels such as biofuels. 

What do you mean by compensation?

Compensation measures are classified as those that offset, capture or otherwise neutralize carbon footprint, other than prevention or reduction. Heerema will begin by investing in carbon offsetting projects that align with its mission to create sustainable value(s). These will be certified carbon reduction projects that are already in development with the accredited Climate Neutral Group. By the end of 2020, Heerema will begin offsetting 100% of its existing carbon footprint, equaling roughly 250,000 metric tons of carbon per year. The amount of offsetting required to remain carbon neutral is gradually reduced as prevention and reduction measures increase. It is estimated that the remaining 20% of emissions will need to be compensated, preferably by means of carbon capture and storage on-board Sleipnir.