Denmark-based supplier of marine fuel Bunker Holding has concluded its first blockchain-powered carbon insetting operation in a new partnership with Dutch carbon insetting firm 123Carbon and French classification society Bureau Veritas.
This project marks the launch of Bunker Holding’s insetting capability, which delivers global decarbonization opportunities to parties across the shipping value chain in an effort to accelerate decarbonization in the maritime sector.
As explained, the insetting partnership allows for the additional cost delivery of lower carbon, alternative marine fuels – such as sustainable biofuel – to be shared by carriers, freight forwarders, and cargo owners within the same value chain; allocated based on a globally accepted book and claim methodology.
“We’re excited to work with 123Carbon and Bureau Veritas, as we believe in complete transparency of how insets are created and transferred. Insetting is not new, but one concern within the maritime sector is under what circumstances alternative fuels are supplied, and who owns the emissions reductions,” Tobias Troye , Head of Carbon Solutions at Bunker Holding, commented.
“We are delighted that Bunker Holding not only uses our advanced platform for the issuance of the certificates, but has also chosen a fully branded solution to deliver the certificates in a secure environment to its customers,” Jeroen van Heiningen , Managing Director of 123Carbon, said.
Working with 123Carbon’s blockchain-based insetting platform and Bureau Veritas as a third-party assurance partner to verify the fuel intervention and all related documentation ensures that all insets are issued according to Smart Freight Centre’s Book & Claim methodology and 123Carbon’s assurance protocol, Bunker Holding said.
To facilitate the intervention, Bunker Holding connected three different parties: the cargo owner, who wishes to reduce their scope 3 emissions and is willing to pay the “green premium”, the ship operator, to decarbonize its vessels through the use of biofuels, and the biofuel supplier, to deliver safe, high-quality low-carbon fuels.
Due to the commitment from the cargo owner to purchase scope 3 insets, Bunker Holding was able to offer the biofuel at a more competitive cost to the ship operator, enabling the carrier to use biofuels instead of conventional fossil fuels.
“As a group, we are operationalising our decarbonisation strategy, and one key component has been to develop our alternative marine fuel supply capabilities, among others by securing fully certified biofuel availability in more than 100 ports around the world. The relative higher cost of alternative fuels may still prevent carriers to bunker it. However, carbon insetting helps bridge that gap, as it enables cost sharing and also sends an important demand signal to alternative fuel producers to scale up production,” Valerie Ahrens , Senior Director of New Fuels and Carbon Markets at Bunker Holding, concluded.
In related news, 123Carbon has collaborated with several shipping companies on carbon insetting to reduce emissions and carbon footprint within the maritime industry.