Norwegian Cruise Line Holdings (NCLH) has announced its long-term climate action strategy and goal.
This strategy is aimed at reaching carbon neutrality through reducing carbon intensity, identifying and investing in technology including exploring alternative fuels and implementing a voluntary carbon offset programme, the company said.
In addition to ongoing initiatives to reduce its emissions rate, NCLH said that it was committed to offset 3 mill tonnes of carbon dioxide equivalent (MTCO2e) over a three-year period starting this year to help bridge the gap in its de-carbonisation efforts until new technology becomes available.
As part of the company’s global sustainability programme, Sail & Sustain, combating climate change was a material focus and it had also signed the Cruise Lines International Association (CLIA) commitment to reduce the carbon emissions rate industry-wide by 40% by 2030 from a 2008 baseline.
“We take climate change very seriously and have pro-actively developed a long-term strategy with an ambitious goal of reaching carbon neutrality through three action areas including reducing carbon intensity, identifying and investing in technology and implementing a carbon offset programme.
“Our commitment to purchase 3 mill tonnes of carbon credits is a measurable step in near-term emissions reductions, which allows us to take action today and helps bridge the gap in our de-carbonisation efforts as we prepare for a lower-carbon future,” explained Frank Del Rio, NCLH President and CEO (pictured).
“Our global sustainability programme, Sail & Sustain, is centred around our commitment to drive a positive impact on society and the environment and our long-term climate action strategy reinforces this commitment and aligns with the vision of the Paris Agreement to achieve a climate neutral world,” he added.
NCLH’s three long-term climate action strategy focus areas include:
- Reduce Carbon Intensity. The company continually seeks opportunities to reduce its overall footprint by minimising fuel consumption and increasing energy efficiency.
Ongoing investments in systems and technologies have resulted in a reduction of fuel consumption per capacity day of about 17% from 2008 to 2019 for the whole 28-ship fleet.
In addition, the company achieved an estimated 14% reduction in CO2 emissions per capacity day across its fleet between 2015 and 2019. As nine new and more fuel-efficient vessels are introduced to the fleet through 2027, this rate is expected to further decrease.
- Invest in Technology & Explore Alternative Fuels. NCLH has partnered with CLIA and other maritime organisations to propose the establishment of a collaborative shipping research and development fund dedicated to the ultimate goal of eliminating CO2 emissions from international shipping.
If approved, funding would come from a contribution per tonne of marine fuel purchased for consumption and is expected to amount to $5 bill over a 10-year period.
These funds will be used to finance the development of zero and near-zero GHG fuels and propulsion technologies. As new alternative fuel sources become available at sufficient scale in the future, the company will evaluate how these can accelerate its long-term carbon reduction strategy.
- Implement Voluntary Carbon Offset Programme. The company has announced its commitment to purchase carbon credits to offset 3 mill MTCO2e over a three-year period to help bridge the gap in de-carbonisation efforts until new technology becomes available.
Offset purchases are expected to ramp up in future years to reach the goal of carbon neutrality.
NCLH said it had a strong focus on addressing climate change and has partnered with CLIA, domestic and international governments and non-governmental organisations (NGOs) to contribute to global efforts to combat climate change.
Key initiatives include its participation in CLIA’s commitment to reduce the carbon emissions rate industry-wide by 40% by 2030, which was created as the first step to contribute to the IMO’s vision of a carbon-free shipping industry by the end of the century.
The company also complies with applicable regulations, quantifies and reports its greenhouse gas emissions (GHG) and seeks new cost-effective ways to reduce or minimise its footprint.
As part of this strategy, NCLH has launched a voluntary carbon offset programme in collaboration with World Kinect Energy Services, the sustainability division of World Fuel Services (WFS).
It has committed to voluntarily offset at least three million MTCO2e through 2023. This is the equivalent of 7,539,593,613 miles driven by an average passenger car or the amount of carbon sequestered in 3,675,533 acres of forests in one year.
NCLH plans to gradually increase voluntary offset purchases in future years to reach its goal of carbon neutrality based on Scope 1 emissions, which typically account for about 95% of its footprint.
This initiative allows the company to take action immediately and further demonstrates its commitment to addressing climate change even while facing the unprecedented impact on profitability due to the COVID-19 related global voyage suspension, it said.
A carbon offset represents 1 tonne of GHG emissions that has been avoided or reduced in the atmosphere. Purchasing carbon offsets allows companies to compensate for their residual carbon footprint by supporting projects worldwide that reduce carbon emissions.
Through World Kinect, NCLH is investing in high-quality, trusted carbon offsets that have been independently verified and meet the highest international standards such as the Gold Standard or the Verified Carbon Standard (VCS). The offsets are from a mixed project portfolio that includes renewable energy, forestry, energy efficiency, and waste to energy projects.
“Each organisation has a unique journey to sustainability, but it starts with vision combined with action. We applaud Norwegian Cruise Line Holdings’ thoughtful approach and leadership,” said Michael Kasbar, WFS Chairman and CEO. “Our experts at World Kinect developed a tailored carbon offset solution that enables Norwegian to make immediate progress towards their long-term sustainability goals.”