[House Hearing, 116 Congress]
[From the U.S. Government Publishing Office]




 
THE PATH TO A CARBON-FREE MARITIME INDUSTRY: INVESTMENTS AND INNOVATION

=======================================================================

                                (116-48)

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                COAST GUARD AND MARITIME TRANSPORTATION

                                 OF THE

                              COMMITTEE ON
                   TRANSPORTATION AND INFRASTRUCTURE
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED SIXTEENTH CONGRESS

                             SECOND SESSION

                               __________

                            JANUARY 14, 2020

                               __________

                       Printed for the use of the
             Committee on Transportation and Infrastructure
             
             
             
             
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     Available online at: https://www.govinfo.gov/committee/house-
     transportation?path=/browsecommittee/chamber/house/committee/
                             transportation
                             
                             
                             
                           ______                      


             U.S. GOVERNMENT PUBLISHING OFFICE 
42-243 PDF             WASHINGTON : 2020      
 
 
                             


             COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

  PETER A. DeFAZIO, Oregon, Chair
SAM GRAVES, Missouri                 ELEANOR HOLMES NORTON,
DON YOUNG, Alaska                      District of Columbia
ERIC A. ``RICK'' CRAWFORD, Arkansas  EDDIE BERNICE JOHNSON, Texas
BOB GIBBS, Ohio                      RICK LARSEN, Washington
DANIEL WEBSTER, Florida              GRACE F. NAPOLITANO, California
THOMAS MASSIE, Kentucky              DANIEL LIPINSKI, Illinois
MARK MEADOWS, North Carolina         STEVE COHEN, Tennessee
SCOTT PERRY, Pennsylvania            ALBIO SIRES, New Jersey
RODNEY DAVIS, Illinois               JOHN GARAMENDI, California
ROB WOODALL, Georgia                 HENRY C. ``HANK'' JOHNSON, Jr., 
JOHN KATKO, New York                 Georgia
BRIAN BABIN, Texas                   ANDRE CARSON, Indiana
GARRET GRAVES, Louisiana             DINA TITUS, Nevada
DAVID ROUZER, North Carolina         SEAN PATRICK MALONEY, New York
MIKE BOST, Illinois                  JARED HUFFMAN, California
RANDY K. WEBER, Sr., Texas           JULIA BROWNLEY, California
DOUG LaMALFA, California             FREDERICA S. WILSON, Florida
BRUCE WESTERMAN, Arkansas            DONALD M. PAYNE, Jr., New Jersey
LLOYD SMUCKER, Pennsylvania          ALAN S. LOWENTHAL, California
PAUL MITCHELL, Michigan              MARK DeSAULNIER, California
BRIAN J. MAST, Florida               STACEY E. PLASKETT, Virgin Islands
MIKE GALLAGHER, Wisconsin            STEPHEN F. LYNCH, Massachusetts
GARY J. PALMER, Alabama              SALUD O. CARBAJAL, California, 
BRIAN K. FITZPATRICK, Pennsylvania   Vice Chair
JENNIFFER GONZALEZ-COLON,            ANTHONY G. BROWN, Maryland
  Puerto Rico                        ADRIANO ESPAILLAT, New York
TROY BALDERSON, Ohio                 TOM MALINOWSKI, New Jersey
ROSS SPANO, Florida                  GREG STANTON, Arizona
PETE STAUBER, Minnesota              DEBBIE MUCARSEL-POWELL, Florida
CAROL D. MILLER, West Virginia       LIZZIE FLETCHER, Texas
GREG PENCE, Indiana                  COLIN Z. ALLRED, Texas
                                     SHARICE DAVIDS, Kansas
                                     ABBY FINKENAUER, Iowa
                                     JESUS G. ``CHUY'' GARCIA, Illinois
                                     ANTONIO DELGADO, New York
                                     CHRIS PAPPAS, New Hampshire
                                     ANGIE CRAIG, Minnesota
                                     HARLEY ROUDA, California
                                     CONOR LAMB, Pennsylvania
                                ------                                
                                

        Subcommittee on Coast Guard and Maritime Transportation

 SEAN PATRICK MALONEY, New York, 
               Chair
BOB GIBBS, Ohio                      RICK LARSEN, Washington
DON YOUNG, Alaska                    STACEY E. PLASKETT, Virgin Islands
RANDY K. WEBER, Sr., Texas           JOHN GARAMENDI, California
BRIAN J. MAST, Florida               ALAN S. LOWENTHAL, California
MIKE GALLAGHER, Wisconsin            ANTHONY G. BROWN, Maryland
CAROL D. MILLER, West Virginia       CHRIS PAPPAS, New Hampshire, Vice 
SAM GRAVES, Missouri (Ex Officio)    Chair
                                     CONOR LAMB, Pennsylvania
                                     PETER A. DeFAZIO, Oregon (Ex 
                                     Officio)



                                CONTENTS

                                                                   Page

Summary of Subject Matter........................................     v

                 STATEMENTS OF MEMBERS OF THE COMMITTEE

Hon. Sean Patrick Maloney, a Representative in Congress from the 
  State of New York, and Chairman, Subcommittee on Coast Guard 
  and Maritime Transportation:

    Opening statement............................................     1
    Prepared statement...........................................     2
Hon. Bob Gibbs, a Representative in Congress from the State of 
  Ohio, and Ranking Member, Subcommittee on Coast Guard and 
  Maritime Transportation:

    Opening statement............................................     3
    Prepared statement...........................................     3
Hon. Peter A. DeFazio, a Representative in Congress from the 
  State of Oregon, and Chairman, Committee on Transportation and 
  Infrastructure, prepared statement.............................    63
Hon. Sam Graves, a Representative in Congress from the State of 
  Missouri, and Ranking Member, Committee on Transportation and 
  Infrastructure, prepared statement.............................    64

                               WITNESSES

Joshua Berger, Governor's Maritime Sector Lead, Washington State 
  Department of Commerce:

    Oral statement...............................................     4
    Prepared statement...........................................     6
John W. Butler, President and Chief Executive Officer, World 
  Shipping Council:

    Oral statement...............................................    11
    Prepared statement...........................................    12
B. Lee Kindberg, Ph.D., Head of Environment and Sustainability-
  North America, Maersk:

    Oral statement...............................................    15
    Prepared statement...........................................    17
Peter Bryn, Technical Solutions Manager-North America, ABB Marine 
  and Ports:

    Oral statement...............................................    19
    Prepared statement...........................................    20
Kathy Metcalf, President and Chief Executive Officer, Chamber of 
  Shipping of America:

    Oral statement...............................................    33
    Prepared statement...........................................    34

                       SUBMISSIONS FOR THE RECORD

Submissions for the Record by Hon. Sean Patrick Maloney:

    Letter of January 14, 2020, from David Bolduc, Executive 
      Director, Green Marine.....................................    64
    Letter of January 14, 2020, from Daniel Hubbell, Shipping 
      Emissions Campaign Manager, Ocean Conservancy..............    66
    Letter of January 13, 2020, from Bruce Appelgate, Associate 
      Director, Scripps Institution of Oceanography..............    69
    Letter of January 14, 2020, from Jesse N. Marquez, Executive 
      Director, Coalition For A Safe Environment.................    70

                                APPENDIX

Questions to Joshua Berger, Governor's Maritime Sector Lead, 
  Washington State Department of Commerce, from:

    Hon. Peter A. DeFazio........................................    77
    Hon. Anthony G. Brown........................................    80
Questions to John W. Butler, President and Chief Executive 
  Officer, World Shipping Council, from:

    Hon. Peter A. DeFazio........................................    81
    Hon. Anthony G. Brown........................................    84
Questions to B. Lee Kindberg, Ph.D., Head of Environment and 
  Sustainability-North America, Maersk, from:

    Hon. Peter A. DeFazio........................................    84
    Hon. Anthony G. Brown........................................    85
    Hon. Carol D. Miller.........................................    86
Questions to Peter Bryn, Technical Solutions Manager-North 
  America, ABB Marine and Ports, from:

    Hon. Peter A. DeFazio........................................    86
    Hon. Anthony G. Brown........................................    87
Foreword to Responses from Kathy Metcalf, President and Chief 
  Executive Officer, Chamber of Shipping of America..............    88
Questions to Kathy Metcalf from:

    Hon. Peter A. DeFazio........................................    89
    Hon. Anthony G. Brown........................................    91
    Hon. Carol D. Miller.........................................    92

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                            January 10, 2020

    SUMMARY OF SUBJECT MATTER

    TO:      LMembers, Subcommittee on Coast Guard and Maritime 
Transportation
    FROM:  LStaff, Subcommittee on Coast Guard and Maritime 
Transportation
    RE:      LHearing on ``The Path to a Carbon-Free Maritime 
Industry: Investments and Innovation''
_______________________________________________________________________


                                PURPOSE

    The Subcommittee on Coast Guard and Maritime Transportation 
will meet on Tuesday, January 14, 2020, at 10:00 a.m. in 2167 
Rayburn House Office Building to survey new developments in 
sustainable shipping technologies and international emissions 
standards established to decarbonize the maritime industry. The 
Subcommittee will hear from Maersk Line, the Washington State 
Department of Commerce, ABB Marine and Ports, Chamber of 
Shipping of America, and the World Shipping Council about 
innovations in zero-emission vessel (ZEV) design, research and 
infrastructure needs, and strategic opportunities for American 
maritime commerce.

                               BACKGROUND

EMISSIONS AND THE MARITIME INDUSTRY

    The International Maritime Organization (IMO) has set the 
stage for a massive decarbonization of the shipping industry. 
On its own, today's international shipping industry accounts 
for over 1 billion tons of emissions per year, 3 percent of 
total global of sulfur oxides (SOx), nitrogen oxide (NOx), 
particulate matter (PM), and carbon dioxide (CO2) emissions.\1\ 
If international shipping were a country, it would rank as the 
6th largest polluting actor on the planet; shipping emissions 
contributed to 1,200 early deaths in the United States last 
year alone.\2\ SOx are known to be harmful to human health, 
causing respiratory symptoms and cardiovascular and lung 
disease, with concentrated impacts in communities adjacent to 
ports.\3\ In the atmosphere, SOx can exacerbate radiative 
forcing and global climate change, leading to acid rain, 
harming crops, forests and aquatic species, and contributing to 
the acidification of the oceans.\4\
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    \1\ Olmer et al., Greenhouse Gas Emissions from Global Shipping, 
2013-2015, The International Council On Clean Transportation, 2017; 
Heitmann N, Khalilian S, Accounting for carbon dioxide emissions from 
international shipping. Burden sharing under different UNFCCC 
allocation options and regime scenarios. Mar Policy 35:682-69, 2011.
    \2\ Schlanger, Zoe, If shipping were a country, it would be the 
world's sixth-biggest greenhouse gas emitter, World Economic Forum, 
2018; Anenberg et al., A Global Snapshot of the Air Pollution-Related 
Health Impacts of Transportation Sector Emissions in 2010 and 2015, The 
International Council On Clean Transportation, 2019.
    \3\ Bhandarkar, S., Vehicular Pollution, Their Effect on Human 
Health and Mitigation Measures, Vehicle Engineering, Vol. 1 Issue 2, 
June 2013; Jiang et al., Air pollution and chronic airway diseases: 
what should people know and do?, Journal of Thoracic Disease Vol. 8 
Issue 1: E31-E40, January 2016; Bailey et al., Pollution prevention at 
ports: clearing the air, Environmental Impact Assessment Review, Vol. 
24, Issues 7-8, October-November 2004, Pages 749-77.
    \4\ Perhac, R.M. (1992) Acid Rain Encyclopedia of Physical Science 
and Technology. Vol. 1. Academic Press, London; Peterson, M., The 
effects of air pollution and acid rain on fish, wildlife, and their 
habitats, U.S. Department of the Interior, Fish and Wildlife Service, 
Office of Biological Services, 80/40.3, 1982; Prinn et al., Effects of 
air pollution control on climate: results from an integrated global 
systems model, from Human Induced Climate Change: an Interdisciplinary 
Assessment, Cambridge University Press, UK, 2007.
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    The IMO has established increasingly stringent greenhouse 
gas emissions reductions from the 2008 baseline: a 40 percent 
reduction by 2030, and a 70 percent reduction by 2050 
regardless of trade growth, with full decarbonization shortly 
after.\5\ The IMO Energy Efficiency Design Index requires all 
newly built ships built from 2013 onwards to meet mandatory 
reduction targets, increasing in stringency every five years up 
until 2030, which is currently incompatible with a continued 
long-term use of fossil fuels by commercial shipping.\6\ While 
demand for seaborne trade is projected to grow by 39 percent 
through 2050, and energy-efficiency measures, hull and 
machinery improvements, and speed reduction are readily 
available to reduce vessel emissions, carbon-neutral fuels will 
need to grow 30-40 percent to meet world fleet energy needs by 
2050, in addition to improving energy efficiency, to achieve 
IMO greenhouse gas ambitions.\7\
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    \5\ International Maritime Organization, IMO Action to Reduce 
Greenhouse Gas Emissions from International Shipping, IMO 2019.
    \6\ Nishatabbas et al., The implementation of technical energy 
efficiency and CO2 emission reduction measures in shipping, Ocean 
Engineering, Vol. 139, 2017: 184-197; DNV GL, Maritime Forecast to 2050 
Energy Transition Outlook 2019.
    \7\ DNV GL, Maritime Forecast to 2050 Energy Transition Outlook 
2019, page 15.

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Figure 1_Available methods to reduce vessel emissions by percentage of 
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                global emissions mitigated. DNV GL 2019.

    To accommodate the IMO emission caps, fossil fuel-based 
marine fuels (such as Heavy Fuel Oil, Low Sulphur Heavy Fuel 
Oil, Marine Diesel Oil and Liquefied Natural Gas) will need to 
comprise a small share of the total fuel mix in 2050.\8\ 
Additionally, by 2025, the IMO will require all new ships be 30 
percent more energy efficient than those built in 2014.\9\ The 
international fleet has made substantial improvements in vessel 
design, emission scrubbing technologies, and fuel efficiency to 
mitigate emissions, but to reach the goals established by the 
IMO shipping companies will need to invest in new vessels, 
alternative fuels, shore and supply infrastructure, and 
logistics facilities.
---------------------------------------------------------------------------
    \8\ Ibid.
    \9\ Chestney. N. IMO agrees on stricter efficiency targets for some 
ships, Reuters, May 2019, Accessed January 9 2020.
---------------------------------------------------------------------------
    Ships are highly capital-intensive assets with typical 
operating lives of 20 to 30 years. With the ratification of new 
emissions standards by the IMO, therefore, shipping companies 
must consider zero-carbon fuels and associated technologies now 
in order to meet established deadlines. Vessels coming online 
after 2030 will need to ZEVs or very low emission vessels in 
order to assure they can operate for their full expected 
commercial life, which would extend to the period after 2025 in 
which fleetwide emissions would be drastically reduced.

FEDERAL PARTICIPATION AT THE IMO

    The United States' Maritime Administration's (MARAD) Office 
of Environment and Compliance has played an important role in 
international maritime environmental policy development for 
several years, serving as a member and active participant of 
the US delegation for the IMO and, more recently, as a 
technical chair and working group members in the International 
Standards Organization. In this role, MARAD collaborates with 
the international maritime industry to establish ship and 
marine technology standards that can improve environmental 
impacts.
    MARAD works with the US Coast Guard, Environmental 
Protection Agency, the US Navy, and the State Department in 
preparing proposed regulations related to emission reductions 
through performance-based standards. Pollutants of concern 
under Annex VI include nitrogen oxides, sulfur oxides, and 
particulates from marine vessels.\10\ In October 2008, Annex VI 
was amended to allow for development of Emission Control Areas 
(ECAs) by 2015.\11\ The ECA system, which establishes tighter 
regional emission standards for engine emissions and fuel 
quality in most coastal waters up to 200 nautical miles from 
the coasts of the continental United States and large portions 
around Alaska and Hawaii, has been found to be a cost-
effective, reliable means of reducing air pollution and 
improving public health.\12\ The North American ECA has been in 
effect since 2015, restricting emissions within the designated 
control area to 0.10 percent sulfur content.\13\ Starting 
January 2020, the IMO expanded the 0.5 percent limit for sulfur 
content to ships operating outside designated ECAs.\14\
---------------------------------------------------------------------------
    \10\ International Maritime Organization, Prevention of Air 
Pollution from Ships, online, see (Reg. 4, 13, 14, 15, 16, and 18), 
Accessed Jan 9 2020.
    \11\ Ibid.
    \12\ Environmental Protection Agency, Proposal to Designate an 
Emission Control Area for Nitrogen Oxides, Sulfur Oxides and 
Particulate Matter Technical Support Document, Assessment and Standards 
Division, Office of Transportation and Air Quality, EPA-420-R-09-007, 
April 2009.
    \13\ International Maritime Organization, North American emission 
control area comes into effect on 1 August 2012, online, Accessed Jan 9 
2020.
    \14\ Ibid.

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  Figure 2_Alternative fuel are variably accessibility and ready for 
    deployment, many still lacking the necessary infrastructure and 
    availability to be considered viable by operators. Fuel sources 
(identified by color on the key to the right), are ranked by technology 
    maturity along a scale from low maturity (red) to high maturity 
                     (green). Source: DNV GL 2019.

ALTERNATIVE FUEL TECHNOLOGIES

    Existing technologies and fuels deployed to meet the US ECA 
and early IMO emissions caps include scrubbers, a mechanical 
treatment of high sulfur fuels to remove sulfur from the 
exhaust of the vessel, and low sulfur fuels like LNG, which 
remains price-competitive with distillate fuels and requires 
limited installation of additional processing technology. 
Alternative technologies under consideration by operators to 
meet the new IMO emissions caps include hydrogen, ammonia, 
methanol, and electricity. The technical applicability and 
commercial viability of alternative fuels and power sources 
will vary greatly for different ship types and trades, like 
deep-sea vessels or short-sea shipping operators.
    For most alternative fuels and power sources, technical 
applicability and commercial viability will vary greatly for 
different ship types and trades. Deep-sea shipping comprises 
large ocean-going ships, and a large proportion of their energy 
consumption relates to propulsion of the ship at steady speed 
over long distances. These vessels are today driven by two-
stroke combustion engines, which are highly efficient for 
propulsion and maximize the space available for cargo through 
the use of energy-dense fuel. Short-sea vessels, travelling 
shorter distances and with variable power demands make electric 
or hybrid-electric power systems (including diesel/gas 
electric) more efficient than traditional mechanical drives. 
The wide range of engine load profiles in the short-sea fleet 
increases flexibility for using energy from batteries, fuel 
cells and waste heat as well as renewable sources (e.g. solar, 
wind, waves) available onshore.
    The primary energy sources considered to produce existing 
alternative fuels like hydrogen, ammonia, methanol, gas oil and 
electricity include: natural gas with capture and storage for 
hydrogen and ammonia, biomass and algae for methanol and gas, 
and renewable electricity for hydrogen and batteries. 
Hybridization and electrification can deliver emission savings 
regardless of the type of fuel used to generate electricity. To 
develop, prove, scale and commercialize ZEVs, operators are 
establishing collaborative joint ventures with fuel technology 
companies, equipment manufacturers and energy developers from 
other industrial sectors outside of shipping. The U.S. 
Department of Energy's Water Office, MARAD's Marine 
Environmental Technical Assistance office, and U.S. Coast Guard 
have initiated conversations about the availability and 
viability of new fuels for use in the maritime industry.

ALTERNATIVE VESSEL DESIGNS

    Cargo ships, like cars, vary widely in performance and 
design. In addition to retrofitting existing ships, compliant 
vessels can be efficiently designed and built to meet the new 
emissions standards.\15\ New vessel designs including battery 
electric propulsion, wind propulsion, hydrodynamic designs, 
internal engine modifications, humid air motors, and other 
internal engineering adjustments are no longer theoretical 
design options for shipowners. Rotor sails, for example, can 
reduce a ship's fuel use by 5-20 percent.\16\ Norsepower in 
Finland, Ladeas in Norway, Mitsui O.S.K. Lines, Ltd. and NYK 
Line in Japan, have acquired detailed design contracts for 
wind-assisted propulsion ship designs; some projects have 
operational wind-assisted vessels on the water today.\17\ For 
existing vessels, third-party operators can assess vessel 
efficiency based on each ship's design specifications and 
engine type, helping shipping companies lower their bunker fuel 
bills and to reduce emissions associated with moving goods 
around the world.\18\
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    \15\ Environmental Protection Agency, Proposal to Designate an 
Emission Control Area for Nitrogen Oxides, Sulfur Oxides and 
Particulate Matter Technical Support Document, Assessment and Standards 
Division, Office of Transportation and Air Quality, EPA-420-R-09-007, 
April 2009.
    \16\ Kornei, K., Spinning metal sails could slash fuel consumption, 
emissions on cargo ships, Science, September 2017.
    \17\ Gallucci, M, Dreamboats, Grist, October 21, 2019. Accessed 
January 5th 2020.
    \18\ Gallucci, M., Shipping industry takes a page from bitcoin to 
clean up its act, Grist, Feb 21, 2019. Accessed January 5th 2020.

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  Example: Zero Emission Research Vessel_Sandia National Laboratories 
   partnered with the Scripps Institution of Oceanography, the naval 
   architect firm Glosten and the class society DNV GL to assess the 
technical, regulatory and economic feasibility of a hydrogen fuel-cell 
  coastal research vessel. Feasibility was found for a 10-knot vessel 
   with 2400 nautical mile range, able to perform 14 Scripps science 
 missions, refueled with liquid hydrogen at 4 different ports of call 
along the U.S. west coast. No ``show-stopping'' issues were identified 
by either DNV GL or the United States Coast Guard. This work was funded 
 by the Maritime Administration (MARAD) within the U.S. Department of 
         Transportation. Source: Sandia National Laboratories.
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Example: Full Port Electrification at the Georgia Ports Authority_Port 
of Savannah is piloting four electric rubber-tired gantry cranes, which 
use 95 percent less fuel than their diesel-powered counterparts by only 
using diesel when moving between container rows. GPA also replaced its 
 27 diesel ship-to-shore cranes with electrified cranes that recharge 
 themselves as they lower containers, producing enough energy to power 
 themselves for 18 minutes of each operating hour. These newly adopted 
technologies provide solution for both GPA and surrounding communities: 
GPA saves money, since electric cranes cost 85 percent less to operate, 
 and communities benefit from reduced pollution. Source: Georgia Ports 
                               Authority.

SHORE POWER AND ELECTRIFICATION

    Cold ironing, also known shore-to-ship power or alternative 
marine power, is the process of providing shoreside electrical 
power to a ship at berth while its main and auxiliary engines 
are turned off. With this process, emergency equipment, 
refrigeration, cooling, heating, lighting, and other equipment 
are still able to receive continuous electrical power, while 
the ship loads or unloads its cargo. Cold ironing requires 
semi-standardized electrical port and vessel infrastructure, 
conduits and safety systems to ensure personnel safety and 
continuous power transfer, and sufficient electrical capacity 
at the port.
    Electrification of port infrastructure and at-berth vessels 
has been demonstrated to significantly reduce per vessel 
emission reductions for NOx, particulate matter and CO2 
emissions, including reductions in noise pollution.\19\ 
Establishing emission control requirements for ports and 
terminals have been implemented at the state and local level in 
California to mitigate localized emissions impacts and reduce 
long-term operating costs.\20\ Because cold ironing requires 
upgrades to ships and shore-side port infrastructure, shore 
power is most feasible for frequently calling ships, and may be 
cost-prohibitive for infrequent callers; industry analysts cite 
a lack of national legislation, tax exemptions on shoreside 
electricity, and a reduced price differential between bunker 
fuel and electricity costs as barriers to global 
implementation.\21\ Marine fuels are currently globally tax 
exempt, providing an additional incentive to use diesel fuels 
for shore power.\22\
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    \19\ Office of Transportation Air Quality, National Port Strategy 
Assessment: Reducing Air Pollution and Greenhouse Gases at U.S. Ports, 
Environmental Protection Agency, EPA-420-R-16-011, September 2016. 
Local governments in California have had success with reducing 
localized vessel emissions through At-Berth regulations in 2007 and 
2009. Recent regulation requires a fleet operator to reduce at-berth 
oxides of nitrogen (NOx) and particulate matter (PM) emissions from its 
vessels' auxiliary engines in port by at least 80 percent by 2020.
    \20\ JD Supra, CARB Continues Roll-Out to Reduce Emissions from 
Vessels in California Ports and Targets Ride-Hailing Vehicle Greenhouse 
Gas Emissions; Update on AB 617, California Air and Climate Vol. 11, 
November 2019; Office of Transportation Air Quality, National Port 
Strategy Assessment: Reducing Air Pollution and Greenhouse Gases at 
U.S. Ports, Environmental Protection Agency, EPA-420-R-16-011, 
September 2016.
    \21\ Sukharenko, D., Shore power lacks global investment, tax 
exemptions, Journal of Commerce online, accessed December 20th 2019.
    \22\ Hiene, D. and Gade, S., Unilaterally removing implicit 
subsidies for maritime Fuels: A mechanism to unilaterally tax maritime 
emissions while satisfying extraterritoriality, tax competition and 
political constraints. Int Econ Econ Policy (2018) 15:523-545.

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Example: Maritime Hydrogen Fuel Cell Project_The Maritime Hydrogen Fuel 
 Cell (MarFC) project is testing the feasibility of hydrogen-fuel-cell-
 powered generators as an alternative to diesel generators to provide 
  clean power in port operations. Co-funded by the U.S. Department of 
   Energy's Fuel Cell Technologies Office and the U.S. Department of 
 Transportation's Maritime Administration, MarFC completed a six-month 
 deployment at the Port of Honolulu. Other Barge-Mounted Hydrogen Fuel 
 Cell for Vessel Cold-Ironing were found to be able to power container 
 ships at berth at the Port of Tacoma and/or Seattle, powering tugs at 
     anchorage near the Port of Oakland, and powering refrigerated 
  containers on-board Hawaiian inter-island transport barges. Port of 
Seattle, the Suisun Bay Reserve Fleet, the California Maritime Academy, 
  and an excursion vessel on the Ohio River have other demonstration 
            projects. Source: Sandia National Laboratories.

CHALLENGES FOR THE MARITIME INDUSTRY:

    1. LAvailability: New technologies and fuels require 
sufficient supply chains and safety infrastructure in whatever 
ports they intend to visit in the United States or abroad for 
each category of alternative fuel. LNG, for example, is 
available globally and in large volumes, but limited bunkering 
infrastructure has directed LNG-fueled vessels to ports that 
can ensure access to that fuel.
    2. LSafety: The new properties and qualities of alternative 
low emissions fuels may pose different safety challenges for 
vessel and port operators and which may result in changes to 
regulatory and enforcement capacity in the Environmental 
Protection Agency and the U.S. Coast Guard. For example, the 
significantly higher buoyancy of hydrogen compared to natural 
gas means that hazardous zones defined in current maritime 
safety codes for natural gas may be inaccurate if applied to 
hydrogen. Operators, regulators, and crew will need to adjust 
to vessel operations to safely accommodate new fuel sources.
    3. LEnforcement: Limited compliance and enforcement of the 
2020 sulfur cap, emission reduction measures, and at-berth 
emissions regulations will undermine the efficacy of these 
programs. For example, from 2014-2016, one liner did not meet 
operational time limits for diesel use for at least half of its 
visits to the Port of Los Angeles Long Beach.\23\
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    \23\ California Air Resources Board, California Air Resources Board 
settles with COSCO Container Lines Co., Ltd., for $965,000, California 
Air Resource Board, December 2019.
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    4. LLimitations of Electrification: The potential for 
electricity in the maritime sector is currently limited to 
short-sea and in-port operations. Maersk is testing battery 
power at sea to utilize excess energy generated at off-peak 
hours to operate large container vessels.\24\
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    \24\ Maersk Intl., Maersk to pilot a battery system to improve 
power production, Press Release, November 2019.
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    5. LResearch and Development: Eight global shipping 
associations have submitted a plan to the IMO for a fuel tax 
dedicated to helping eliminate CO2 emissions from international 
shipping.\25\ The tax would generate funds of about $5 billion 
over a 10-year period, which the association deems necessary to 
achieve the IMO's 2050 emission reduction targets.\26\
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    \25\ Those associations include BIMCO, Cruise Lines International 
Association, Intercargo, Interferry, International Chamber of Shipping, 
Intertanko, International Parcel Tankers' Association and the World 
Shipping Council. The Maritime Executive, Fuel Tax Proposed to Fund $5 
Billion R&D Plan, December 18 2019, Accessed Jan 9 2020.
    \26\ The Maritime Executive, Fuel Tax Proposed to Fund $5 Billion 
R&D Plan, January 2020.
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                              WITNESS LIST

     LMr. Joshua Berger, Governor's Maritime Sector 
Lead, State of Washington
     LMr. John Butler, President and Chief Executive 
Officer, World Shipping Council
     LMs. Lee Kindberg, Director, Environment & 
Sustainability, Maersk Line/Maersk Agency USA
     LMr. Peter Bryn, Technical Solutions Manager, 
North America, ABB Marine & Ports
     LMs. Kathy Metcalf, President and Chief Executive 
Officer, Chamber of Shipping of America


THE PATH TO A CARBON-FREE MARITIME INDUSTRY: INVESTMENTS AND INNOVATION

                              ----------                              


                       TUESDAY, JANUARY 14, 2020

                  House of Representatives,
          Subcommittee on Coast Guard and Maritime 
                                    Transportation,
            Committee on Transportation and Infrastructure,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 10:01 a.m. in 
room 2167, Rayburn House Office Building, Hon. Sean Patrick 
Maloney (Chairman of the subcommittee) presiding.
    Mr. Maloney. The subcommittee will come to order.
    I ask unanimous consent that the chair be authorized to 
declare recess during today's hearing.
    Without objection, so ordered.
    Good morning. Welcome to today's hearing on innovations and 
new developments as we build towards a sustainable carbon-free 
maritime transportation future.
    If international shipping were its own country, it would 
rank as the sixth largest polluter on the planet. The 
conventional heavy fuels used to move massive oceangoing 
vessels are laden with sulfur oxides, diesel particulate 
matter, and carbon dioxide. That is not pleasant stuff, and it 
can lead to acid rain, harm crops, acidify oceans, and, not 
incidentally, impact human health.
    For example, shipping emissions contributed to 1,200 early 
deaths in the United States last year alone, disproportionately 
impacting low-income communities of color who live adjacent to 
ports and maritime terminals. That should not be acceptable.
    Recognizing these impacts, the International Maritime 
Organization, or IMO, has committed to reduce total annual 
greenhouse emissions from international shipping by at least 50 
percent by the year 2050 from 2008 emissions levels.
    Additionally, just 2 weeks ago, the IMO's high seas 
maritime fuel sulfur emissions cap was reduced from 3.5 percent 
to .5 percent to protect air quality and human health. 
Shipowners, operators, refineries, and regulators like the 
Coast Guard have adapted to meet this new cap by burning 
cleaner, high-quality, low-sulfur fuels, or by installing 
scrubbing technologies.
    The maritime industry has not taken on these restrictions 
merely for a challenge; they recognize, rather, that 
decarbonizing our global economy is a necessity and an 
opportunity. We are borrowing time from the next generation. 
The time for change is now. And I commend the maritime industry 
taking these initiatives.
    Charting its own path to decarbonize the maritime industry, 
the IMO requires operators to reduce carbon intensity by 
vessel, by unit of work, and across the industry, as a whole. 
This will require investments in vessel efficiency, alternative 
fuels, alternative designs, clean shore power, and more.
    For ships to serve their planned lifetime and to meet the 
2050 emissions reduction goal, vessels coming online after 2030 
will need to be either zero-emission vessels or very low-
emission vessels to assure that they can operate for their 
expected commercial life. We should ensure we have the 
capability to design, build, and operate those vessels here in 
the United States.
    Investing in innovative new technologies and clean maritime 
commerce is just one more opportunity we have to bring the 
American maritime industry into the 21st century, and one we 
cannot afford to miss. Indeed, the maritime community has risen 
to meet the challenge, although I must stress the U.S. can and 
should do much, much more.
    Today we hear from carriers, engineers, and industrial 
designers about the steps they have taken to reduce emissions, 
the challenges they faced along the way, and what comes next 
along the path to a carbon-free but no less efficient, global 
maritime supply chain.
    [Mr. Maloney's prepared statement follows:]

                                 
 Prepared Statement of Hon. Sean Patrick Maloney, a Representative in 
  Congress from the State of New York, and Chairman, Subcommittee on 
                Coast Guard and Maritime Transportation
    Good morning, and welcome to today's hearing on innovations and new 
developments as we build towards a sustainable, carbon-free maritime 
transportation future.
    If international shipping were its own country, it would rank as 
the 6th largest polluter on the planet. The conventional heavy fuels 
used to move massive ocean-going vessels are laden with sulfur oxides, 
diesel particulate matter, and carbon dioxide, nasty stuff that can 
lead to acid rain, harm crops, acidify oceans, and not incidentally, 
also impact human health.
    For example, shipping emissions contributed to 1,200 early deaths 
in the United States last year alone, disproportionately impacting low 
income communities of color who live adjacent to ports and marine 
terminals. This is unacceptable.
    Recognizing these impacts, the International Maritime Organization, 
or ``IMO'', has committed to reduce total annual greenhouse emissions 
from international shipping by at least 50 percent by the year 2050 
from 2008 emissions levels.
    Additionally, just two weeks ago, the IMO's high seas maritime fuel 
sulfur emissions cap was reduced from 3.50 percent to 0.50 percent to 
protect air quality and human health. Ship owners, operators, 
refineries, and regulators like the Coast Guard have adapted to meet 
this new cap by burning cleaner, higher quality low sulfur fuels or by 
installing scrubbing technologies.
    The maritime industry has not taken on these restrictions merely 
for a challenge: they recognize, rather, that decarbonizing our global 
economy is a necessity and an opportunity. We are borrowing time from 
the next generation. The time for change is now, and I commend the 
maritime industry taking the initiative.
    Charting its own path to decarbonize the maritime industry, the IMO 
requires operators to reduce carbon intensity by vessel, by unit of 
work, and across the industry as a whole. This will require investments 
in vessel efficiency, alternative fuels, alternative designs, clean 
shore power, and more.
    For ships to serve their planned lifetime and to meet the 2050 
emissions reduction goal, vessels coming online after 2030 will need to 
be either zero emission vessel or very low emission vessels to assure 
they can operate for their expected commercial life. We should ensure 
we have the capability to design, build, and operate those vessels in 
the United States.
    Investing in innovative new technologies and clean maritime 
commerce is just one more opportunity to bring the American maritime 
industry into the 21st century, and one we can't afford to miss.
    Indeed, the maritime community has risen to meet the challenge, 
although I must stress, the U.S. can and should do much, much more. 
Today we will hear from carriers, engineers, and industrial designers 
about the steps they've taken to reduce emissions, the challenges 
they've faced along the way, and what comes next along the path to a 
carbon-free, but no less efficient, global maritime supply chain.

    Mr. Maloney. I ask unanimous consent to insert statements 
from Green Marine, the Ocean Conservancy, Scripps Institution 
of Oceanography, and the Coalition for a Safe Environment into 
the hearing record.
    Without objection.
    [The information is on pages 64-76.]
    Mr. Maloney. I would now like to call on the ranking 
member, Mr. Gibbs, for any opening remarks.
    Mr. Gibbs. Thank you, Chairman Maloney, and thank you to 
the witnesses here today. The International Maritime 
Organization administers the Convention on the Prevention of 
Pollution from Ships, and sets targets for the reduction of 
sulfur emissions, which went into effect the beginning of this 
month.
    I look forward to hearing what industry is doing to reach 
these targets, which took effect earlier in the North American 
and European emission control areas.
    IMO also set targets for significant further reductions in 
vessel air emissions in 2030--40 percent below the 2008; and 
2050--70 percent below 2008 levels.
    I am also interested in whether the witnesses believe these 
targets can be met and, if so, what would the cost be.
    IMO also sets international standards for various other 
discharges from vessels, including oil; garbage, including 
plastic; wastewater, and ballast water.
    Efforts are also underway to require that ships be quieter.
    I support market-driven solutions to great investment and 
innovation of new technologies, which will create a more 
efficient maritime transportation system. Government mandates 
will only hinder ongoing private-sector efforts to innovate and 
improve environmental sustainability. I think we need to look 
at the impacts of all these regulations on the shipping 
industry, and look to witnesses' comments on the collective 
impact of these various environmental regulations, and the cost 
and efficiency of ocean shipping.
    [Mr. Gibbs' prepared statement follows:]

                                 
Prepared Statement of Hon. Bob Gibbs, a Representative in Congress from 
the State of Ohio, and Ranking Member, Subcommittee on Coast Guard and 
                        Maritime Transportation
    International shipping contributes 3 percent of total global 
emission of sulfur oxides, nitrogen oxide, particulate matter and 
carbon dioxide emissions. The International Maritime Organization which 
administers the Convention on the Prevention of Pollution from Ships 
set targets for the reduction of sulfur emissions which went into 
effect at the beginning of this month. I look forward to hearing what 
industry is doing to reach these targets which took effect earlier in 
the North American and European emission control areas.
    IMO also set targets for significant further reductions in vessel 
air emissions in 2030 (40 percent below 2008) and 2050 (70 percent 
below 2008 levels). I am interested in whether the witnesses believe 
these targets can be met, and if so, at what cost.
    IMO also sets international standards for various other discharges 
from vessels, including oil, garbage (including plastic), wastewater, 
and ballast water. Efforts are also underway to require that ships be 
quieter. I think we need to look at the impacts of all these 
regulations on the shipping industry, and I look to witnesses' comments 
on the collective impact of these various environmental regulations on 
the cost and efficiency of ocean shipping.

    Mr. Gibbs. Thank you, Chairman, for holding this hearing 
today, and I yield back.
    Mr. Maloney. I thank the gentleman.
    I would now like to welcome the witnesses on our panel: Mr. 
Joshua Berger, Governor's maritime sector lead for the State of 
Washington; Mr. John W. Butler, president and chief executive 
officer of the World Shipping Council; Dr. B. Lee Kindberg, 
director of environment and sustainability for Maersk/Maersk 
Agency USA; Mr. Peter Bryn, technical solutions manager, North 
America, for ABB Marine and Ports; and Ms. Kathy Metcalf, 
president and chief executive officer for the Chamber of 
Shipping of America.
    Thank you for being here today. We look forward to your 
testimony.
    Without objection, our witnesses' full statements will be 
included in the record.
    Since your written testimony has been made part of the 
record, the subcommittee requests that you limit your oral 
testimony to 5 minutes.
    Mr. Berger, you may proceed.

 TESTIMONY OF JOSHUA BERGER, GOVERNOR'S MARITIME SECTOR LEAD, 
   WASHINGTON STATE DEPARTMENT OF COMMERCE; JOHN W. BUTLER, 
PRESIDENT AND CHIEF EXECUTIVE OFFICER, WORLD SHIPPING COUNCIL; 
B. LEE KINDBERG, Ph.D., HEAD OF ENVIRONMENT AND SUSTAINABILITY-
NORTH AMERICA, MAERSK; PETER BRYN, TECHNICAL SOLUTIONS MANAGER-
    NORTH AMERICA, ABB MARINE AND PORTS; AND KATHY METCALF, 
 PRESIDENT AND CHIEF EXECUTIVE OFFICER, CHAMBER OF SHIPPING OF 
                            AMERICA

    Mr. Berger. Thank you, Chairman Maloney, Ranking Member 
Gibbs, and members of the committee, for the opportunity to 
testify today. I proudly work as Governor Jay Inslee's maritime 
sector lead, and serve as board chair and founder of Washington 
Maritime Blue, a strategic alliance.
    Mr. Maloney. Yes, Mr. Berger, you will find that you can 
bring the box that the microphone is built into towards you. 
That will move. There you go. And if you can speak into it, it 
will help the Members a great deal. Thank you, sir. Sorry for 
the interruption.
    Mr. Berger. Can I start from the beginning for you?
    Mr. Maloney. If you want, but if you could just bring that 
microphone right towards you, sir, it will move, as well.
    Mr. Berger. Perfect.
    Mr. Maloney. There you go.
    Mr. Berger. Thank you. So I serve as Governor Jay Inslee's 
maritime sector lead, and board chair of Washington Maritime 
Blue. It is a strategic alliance for multisector stakeholders 
charged to implement Washington State's strategy for the blue 
economy. It is a plan to accelerate innovation, investment, and 
sustainability in the maritime and ocean sectors.
    I have submitted written testimony that outlines the 
details of our State's plan and our implementation strategy. 
And today I am here to share how coordination and 
multistakeholder partnerships have contributed to our success 
and national leadership, and I ask that Congress consider what 
role you can play to support both the necessary R&D plus the 
ecosystems for innovation it will take to achieve national and 
global targets.
    The OECD predicts that the maritime and ocean economy will 
double to $3 trillion by 2030. Other nations in Europe and Asia 
are investing billions in zero-emission maritime solutions and 
ecosystems of innovation in a coordinated and organized 
approach. Not only are they drastically reducing emissions and 
increasing safety, but they are helping to save billions in 
operational costs. They are creating new markets, and driving 
capital investments and jobs into communities.
    In the State of Washington we have decided that this is the 
course we want to set to do the right thing and stay 
economically competitive in a global stage. With great 
commitment from our industry leaders, we are building on our 
State's diverse and interdependent maritime sector, and 
leveraging the expertise of our research institutions, tech 
industry, advanced manufacturing, and ocean engineering to 
drive investment.
    Add to this a long history of commitment to environmental 
performance, quality craftsmanship, and best management 
practices, and couple that with a culture of innovation, 
investment, and collaboration, and we will create a global hub 
for solutions and economic growth.
    As we were wrapping up our strategy last year, it became 
clear that we needed mechanisms in place to begin implementing 
on day one. We investigated other world-class maritime regions. 
What we consistently found was an organized approach to bring 
together what we call the quadruple helix of innovation 
clusters: Government, industry, research institutions, and, in 
our case, workforce and community-based organizations, all 
partnering together.
    The day we released the strategy, we launched Washington 
Maritime Blue in exactly that vein. In its first year we have 
grown to over 75 members from multiple sectors, all invested in 
Washington's maritime and ocean economy. Often, direct 
competitors are in the room collaborating to grow collective 
markets through standardization and technology transfer. They 
are working together.
    Over the last year we have completed a capital landscape 
study for investments, we are supporting the electrification of 
the Washington State ferry system through supplier engagement, 
we have funded an innovation center, and are kicking off a 
maritime blue innovation accelerator with 11 companies. We are 
conducting a feasibility study and a triple bottom line 
decisionmaking tool for a zero-emission pilot boat, and 
facilitating at least two other joint innovation projects to 
develop zero-emission vessels.
    But despite this incredible leadership our industry 
stakeholders have taken, they cannot do it alone. If we were to 
be successful, it will need to take an organized approach and 
the right strategic investments by Congress to support the 
millions of existing jobs in the maritime sector, and create 
the next generation of workforce to make that a reality.
    We are encouraged by the collaborative approach of some key 
leaders in the Department of Commerce, Department of Energy, 
NOAA, the Navy, Coast Guard, and MARAD, and we will continue to 
work closely with our partners there. However, to maintain 
momentum and stay competitive, we need Congress to support a 
national network of maritime and ocean innovation clusters. We 
cannot foster and enable these ecosystems of innovation in 
isolation. State and local leaders need assistance and 
resources to support local companies to collaborate and stoke 
the interest of entrepreneurs and investors to take advantage 
of that $3 trillion opportunity.
    You have access to our complete State strategy, and I 
encourage you to read it through. It works to advance our goals 
as an industry. Together we can take advantage of models that 
are working, continue to gather our resources, and get to work.
    Thank you, and I look forward to answering any questions 
you may have.
    [Mr. Berger's prepared statement follows:]

                                 
 Prepared Statement of Joshua Berger, Governor's Maritime Sector Lead, 
                Washington State Department of Commerce
    Thank you, Chairman Maloney, Ranking Member Gibbs, and members of 
the committee, for the opportunity to testify on the path to a carbon-
free maritime industry and the investments and innovation needed to 
achieve this goal. I proudly work as Governor Jay Inslee's Maritime 
Sector Lead and Director of Maritime Economic Development at the 
Washington state Department of Commerce. Over the course of the last 
three years I have been charged by the Governor and his Maritime 
Innovation Advisory Council to both deliver and implement Washington 
state's Strategy for the Blue Economy \1\--a plan to accelerate 
innovation and sustainability in the maritime and ocean sectors.
---------------------------------------------------------------------------
    \1\ Washington state's Strategy for the Blue Economy (2019) WA 
State Dept. of Commerce & DNV GL--www.maritimeblue.org
---------------------------------------------------------------------------
    For context, my role as sector lead is to be a liaison to the 
Governor, Legislature, and state agencies from our key economic 
sectors. I have worked in the maritime industry for over 25 years as a 
professional merchant mariner, maritime workforce educator and marine 
construction project manager--as well as an advocate for ocean 
literacy, marine conservation, and clean technology.
    Today, I'm here to share our state's work to accelerate innovation 
and our investment to decarbonize the maritime sector. And to be clear, 
when I say ``our state'' I mean each of the stakeholders that impact, 
and are impacted by, the maritime and ocean economy across the state of 
Washington. This includes not only our government agencies, but 
employers, technology providers, universities, workforce training 
institutions, national laboratories, labor organizations, tribes, and 
community and environmental organizations, among the many. This level 
of coordination and multi-stakeholder partnership has contributed 
greatly to our success and national leadership as a center of 
excellence for maritime innovation and investment--specifically in 
vessel electrification and the path towards a carbon-free maritime 
industry.
    We're doing this work because it's the right thing to do, and 
because it's how we stay economically competitive on a global stage. 
The Organization for Economic Co-operation and Development (OECD) 
predicts the maritime and ocean economy will double to $3 trillion by 
2030--four times the current space economy. Other nations in Europe and 
Asia are investing billions in zero-emission maritime solutions. Other 
nations are supporting clusters or, ecosystems of innovation, in a 
coordinated and organized approach. The international maritime 
community is focused on tackling the climate crisis using the structure 
of the UN's Sustainable Development Goals as a guidepost. The 
International Maritime Organization (IMO) that regulates the global 
maritime industry is dramatically increasing regulatory pressure. As 
other nations invest in solutions to the climate crisis, not only are 
they drastically reducing emissions and increasing safety--they are 
saving billions in operational costs, creating new markets, and driving 
capital investment and jobs into their communities through design, 
manufacturing, and technology development.
    In the state of Washington, we have decided this is the course we 
want to set. We have decided that our state can leverage the expertise 
of our research institutions, tech industry, advanced manufacturing, 
and ocean engineering to drive investment. We have created a clear, 
multi-stakeholder strategy and are implementing its goals through the 
creation of a formal, independent organization and strategic alliance 
for maritime innovation and sustainability.
    We offer our story as a model of how the federal government and 
other states can continue to support the maritime industry and 
stakeholders to meet global challenges, succeed in an increasing 
regulatory climate, and create equitable and resilient communities.
    Washington state is already home to a diverse and interdependent 
maritime industry that generates $37 billion into our state's economy, 
directly employing 70,000 family-wage jobs and impacting another 
120,000. One in every four jobs in the state are tied to international 
trade, and we have the fourth largest container gateway in the United 
States. Washington state operates the largest ferry system in the U.S. 
The Port of Seattle facilitates the fastest growing cruise industry in 
the U.S. and is home to the North Pacific Fishing Fleet, the largest 
and most sustainable fishery in the world along with our Alaskan 
neighbors. In fact, 90% of all goods on a shelf in Alaska, as well as 
construction, and infrastructure materials are shipped from Washington 
state.
    Our ports, vessel operators, labor force, supply chain, designers, 
and service providers have a long history of commitment to 
environmental performance, quality craftsmanship, and best management 
practices. By coupling this legacy industry with a culture of 
innovation and investment, we can create a global hub for solutions and 
economic growth. This was the impetus for bringing together hundreds of 
diverse stakeholders to create a clear strategy for maritime innovation 
and sustainability--what we call the ``Blue Economy.''
    Our vision is to be the home of a world-class, thriving and 
sustainable maritime industry, and after a year-and-a-half of 
stakeholder engagement, economic study, and technology trends review, 
we agreed on five strategic goals, each with detailed initiatives and 
pathways to achieve them:
    1.  a thriving low carbon maritime industry through deep 
decarbonization;
    2.  a global innovation and investment hub for maritime and ocean 
technology;
    3.  working waterfronts and growing gateways that are clean, smart 
and safe job creators;
    4.  an equitable, diverse, and inclusive 21st century workforce; 
and
    5.  a world-class, coordinated cluster of maritime and ocean 
stakeholders.

    These goals are underpinned by a clear set of values and definition 
of the Blue Economy that all stakeholders could agree upon: a growing 
maritime industry, healthy ocean and marine ecosystems, and resilient 
communities. This set the stage for us to collaborate across the many 
interests involved in our process.
    The success of the strategy development, support and adoption is 
due to our commitment to a collaborative process. We invited each of 
our state's stakeholders from a growing and clean maritime industry. 
Besides inviting the usual groups of industry leaders, labor 
organizations and public agencies involved in the maritime industry, we 
intentionally sought input, early and directly, from tribal leadership, 
research institutions, community groups, environmental NGOs, workforce 
development providers and the investment community. We understand that 
many of the potential solutions to achieve efficiency and reductions in 
emissions in maritime operations can be nuanced. It can be challenging, 
and some solutions can come with unintended consequences, and require 
significant capital costs in an industry with low margins.
    It can be easy to hold fast to pre-conceived ideas about 
technology, transitions, and impacts. However, committing to a multi-
stakeholder and collaborative planning process can highlight and secure 
shared values and commitment. Therefore, when it's time to begin 
implementing initiatives and demonstration projects we've been able to 
obtain early support and investment of resources, time and capacity.
    As we were wrapping up our strategy development last year, it 
became clear to our Advisory Council that we needed mechanisms in place 
to begin implementing the pathways, initiatives and demonstration 
projects outlined in the plan on day-one. We investigated other world 
class maritime regions in Norway, Singapore, France, Japan, Germany and 
the Netherlands, and elsewhere to understand the structure and 
investment pathways for research and development (R&D), 
commercialization and operations of technology solutions. What we 
consistently found was an organized approach to bring together what we 
call the ``Quadruple Helix'' of an innovation cluster: government, 
industry, research institutions, and (in our case) workforce and 
community partners working together to advance and accelerate 
innovation and sustainability.
    The day we released the strategy we launched Washington Maritime 
Blue as an independent, nonprofit cluster organization, a strategic 
alliance for maritime innovation and sustainability. As a partnership 
between industry, public sector, research and training institutions, 
and community organizations, the mission of this new non-profit is to 
create a world-class, thriving, and sustainable maritime industry 
through knowledge sharing, collaborative R&D, commercialization, and 
business and workforce development.
    Supported by the Washington state Department of Commerce, grants, 
contracts, industry members and sponsors, the scope of work of the new 
organization includes:
      Operate a media, marketing and outreach platform for 
sharing the opportunities and growth in the maritime/ocean sectors.
      Produce public forums and events addressing key topics 
such as digitalization, R&D pathways for decarbonization, investment 
and entrepreneurship, marine battery safety, etc.
      Project manage business development opportunities and 
Joint Innovation Projects for members and partners to collaborate on 
R&D, demonstration projects, planning and feasibility studies.
      Act as an intermediary for the development of equitable, 
diverse, career-connected maritime workforce programming for youth, 
internships and apprenticeships.
      Drive investments and funding to key demonstration 
projects and entrepreneurs.
      Develop a Maritime Innovation Center as a focal point and 
hub for supporting startups and technology development.

    In its first year, Washington Maritime Blue has grown to over 75 
members including global maritime technology firms, local maritime 
operators, design firms, startups, manufacturers and service providers, 
as well as public partners such as state agencies, municipalities, 
ports, research institutions and community organizations. All of these 
members are invested in Washington's maritime and ocean economy in some 
way.
    Our members are eager to work together to address the technological 
challenges the industry is facing. Often, direct competitors are in the 
room collaborating to grow collective markets through standardization 
and technology transfer. Working together, we are accomplishing the 
following:
      Completed a ``Capital Landscape Study'' for maritime and 
ocean investments in Washington.
      Supported the electrification of the Washington state 
Ferry fleet through supplier engagement.
      Launched a Maritime Innovation Business accelerator with 
11 maritime and ocean companies for four months of programming and a 
``Demonstration Day'' to potential investors and funders.
      Conducting feasibility study and triple bottom-line 
decision-making tool for a zero-emission pilot boat.

    Among others, there are two specific demonstration projects of note 
that members of Maritime Blue are working to complete through the 
structure of a Joint Innovation Project. The first is to complete a 
feasibility and concept design for a zero-emission, inland cargo vessel 
to deliver recycled corrugated cardboard from the urban core in central 
Puget Sound out to the Olympic Peninsula to a newly re-opened paper 
mill. The mill supports about 150 jobs in a struggling rural community. 
A perfect example of what we call ``short sea shipping''. Inspired by 
the first all-electric, autonomous cargo vessel delivering fertilizer 
throughout the inland waterways of western Norway, Yara Birkland \2\, 
this vessel would take hundreds of trucks off the roads, eliminate all 
emissions, and support job creation in a rural maritime community. 
Naval architects, electrical engineers, system designers, utilities, 
classification societies and the Coast Guard will route plan, provide 
technology reviews, a concept design and operational profile to 
determine feasibility. The role of the cluster organization is to 
gather multiple sources of public and private funding, manage the 
partners and produce a final study.
---------------------------------------------------------------------------
    \2\ Yara Birkland Media Kit, https://www.yara.com/news-and-media/
press-kits/yara-birkeland-press-kit/
---------------------------------------------------------------------------
    The second is a complete design and construction of a zero-
emission, high-speed, passenger ferry to address both congestion and 
impact in the Puget Sound region. The Cluster and project members will 
take an existing concept design to complete engineering and 
construction with local fabricators, shipbuilders and others in the 
product supply chain. Again, we will seek to utilize public dollars to 
help buy down the risk of the private investors, owners, and operators 
so that we can prove the technology capabilities and begin to 
commission similar zero-emission vessels. We hope to rebuild what we 
have historically called the ``Mosquito Fleet''--Passenger ferries 
crisscrossing Puget Sound, but now with zero-impact on marine waters, 
air quality and marine mammals. Greater Seattle has received half a 
million new residents in the last ten years, 2,300 last year alone--
that's just under 200 people a day moving to Seattle that will commute 
up and down the I-5 corridor. A recent feasibility study of a Tacoma to 
Seattle passenger ferry service estimates it would take around 600 
cars, twice a day off of the freeway--a 30 mile, but often 2-hour 
commute by car.
    Washington Maritime Blue is in a unique position to manage these 
Joint Innovation Projects. It has the ability to bring together 
multiple partners in a structure that can manage competitors as 
collaborators. We can create, manage and protect intellectual property 
as we innovate together. As an independent organization, it has the 
flexibility to bring in capital from multiple sources, public and 
private. We can draw expertise and support from our research partners 
and others in a supply chain. It is a model most successfully found in 
the Norwegian Innovation Cluster Program \3\--supported by Innovation 
Norway, a program under the Ministry of Trade and Industry. Ampere, the 
first all-electric car ferry was a Joint Innovation Project. The Yara 
Birkland was born out of a Joint Innovation Project, as will the first 
hydrogen-powered car ferry which is in design and engineering now.\4\
---------------------------------------------------------------------------
    \3\ Norwegian Innovation Cluster Program, https://
www.innovasjonnorge.no/no/subsites/forside/Om_NIC/
    \4\ NCE Maritime CleanTech hydrogen ferry with Norled, https://
maritimecleantech.no/project/hydrogen-ferry/
---------------------------------------------------------------------------
    Having gained insight and examples from others around the globe to 
be an effective enabler of innovation, Washington Maritime Blue itself 
has now become a model for cluster development. We have fostered an MOU 
between the Washington state Department Commerce and Norwegian Ministry 
of Trade and Industry to develop economic and business development 
opportunities for maritime clean technology. We have partner 
organizations in Norway, France, Portugal, Singapore, Canada and Mexico 
as well the cities of Boston, San Diego and Anchorage. We have been 
supporting federal agencies such as the US Coast Guard (USCG), 
Department of Energy (DOE), Maritime Administration (MARAD), National 
Oceanographic and Atmospheric Administration (NOAA), and Environmental 
Protection Agency (EPA) as they seek to broaden their role in the 
development of clean technology for maritime transportation and the 
blue economy. We are supporting other states and regions to develop 
their own strategies and cluster organizations such as Rhode Island, 
the Gulf Coast, and Alaska.
    In Washington state, we often look towards Norway for inspiration. 
Our western coastlines have remarkably similar weather, and we both 
have naturally deep-water ports with strong fisheries and access to 
global trade routes, as well as a legacy of shipbuilding and 
craftsmanship. We both have some of the cheapest and cleanest 
electricity in the world, and a similar culture. In fact, there are 
more Norwegians in Washington state than anywhere else in the world, 
outside of Norway. And yes, Norway may have the largest sovereign 
wealth fund in the world, but how they invest in innovation in direct 
partnership with industry is what sets them apart as a dominant force 
in the maritime industry. They have clear strategic plans, and invest 
not only in solutions but in the ecosystem and culture of innovation 
through industry clusters. Private industry actually asks their 
government for stronger regulation so they can build new markets. They 
trust that the government will work with them to establish a clear and 
consistent regulatory framework and put incentives in place that allow 
them to make the incredibly large capital investments needed to achieve 
carbon-free solutions. These are the type of actions we ask Congress to 
consider.
    Industry, ports and communities cannot do it alone. If we are to 
achieve the IMO's targets to have zero-emission shipping by 2050, it 
will take an organized federal approach, and the right strategic 
capital investments by Congress, to support the millions of existing 
jobs in the maritime sector and create the next generation of workforce 
to make that a reality. This federal support can take many forms: tax 
incentives, directed reinvestment strategies, competitive awards, and 
others.
    We are encouraged by the collaborative approach of some key leaders 
in the Department of Energy, NOAA, the Navy, Coast Guard and Maritime 
Administration. Washington Maritime Blue recently held a workshop for 
federal agencies and national laboratories to engage with our industry 
members to help focus and organize R&D pathways for maritime energy 
solutions. We intend to help them replicate and scale this approach 
around the U.S. We were also pleased to participate in the executive 
branch's Summit on Ocean Science and the Blue Economy last November to 
help strategize a cross-federal agency approach to solutions.
    To maintain momentum and stay competitive, we need Congress to 
support a national network of maritime and ocean innovation clusters. 
States, regions and cities like ours are bringing together local 
government agencies, industry, and research institutions to solve 
challenges and create business opportunities and jobs. However, they 
cannot foster and enable these ecosystems of innovation and 
collaboration alongside growing competitive markets in isolation. State 
and local leaders need federal assistance and resources to support 
local companies to collaborate and stoke the interest of entrepreneurs 
and investors to take advantage of this $3 trillion opportunity over 
the next decade.
    Washington Maritime Blue is grateful for the U.S. Economic 
Development Administration's grant support to develop our state's 
strategy and seed our cluster organization. Continued federal support 
for the operation of innovation cluster organizations could take the 
form of direct funding, providing teams of professional advisors, 
marketing support, and facilitation of cross-sector business 
opportunities, entrepreneurship, and joint innovation.
    It can be risky to be a trailblazer. It can require significant 
capital investment, and it can prove challenging to build trust with 
community stakeholders. This either becomes a cycle of doubt that slows 
the velocity of change or, when collaboration, effective regulation, 
and action are embraced, it becomes the sustaining energy that 
accelerates a cycle of progress. It is a fact that when maritime 
companies are supported in an innovation-based business plan, they can 
and will make investments geared toward community empowerment and 
sustainable returns. The Maritime Blue Strategy embraces this cycle to 
propel the industry and communities forward.
    It has been a tremendous process to get to where we are today, but 
the course we were able to identify and plot through engaging with all 
of our stakeholders and analyzing innovation trends enabled us to build 
a plan that does more than sit on a shelf with pretty graphics. As you 
see, we are already underway, industry and partners are engaging, and 
projects are happening, and we continue to look for public and private 
funding opportunities.
    You have access to our complete state strategy \5\, and I encourage 
you to read through it. It works to advance our goals as an industry, 
as a state, and as a partner in the global movement to decarbonize the 
maritime industry and improve ocean health, and it seeks to address our 
challenges with open dialogue in a thoughtful manner.
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    \5\ Washington state's Strategy for the Blue Economy (2019) WA 
State Dept. of Commerce & DNV GL--www.maritimeblue.org
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    We are enabling an entire ecosystem of passionate communities 
researching, developing, and implementing a carbon-free maritime 
transportation industry. We are investing and innovating for a global, 
sustainable blue economy so that we can address these pressing issues 
through balance, alignment and careful, committed consideration of 
impacts and unintended consequences. We are proud of what we have 
created. We are proud to be part of collaborative group of 
stakeholders. We are proud to help lead our nation while strengthening 
communities and protecting the ocean ecosystem that we are so vitally 
connected to.
    Together, we can take advantage of models that are working, 
continue to gather our resources, and get to work!
    Thank you, I look forward to answering any questions you may have.

    Mr. Maloney. I thank the gentleman. Before I proceed, I 
would just like to welcome the congressman from Pennsylvania to 
the subcommittee, Mr. Lamb. He is a new member of the 
committee, replacing our beloved Elijah Cummings. Congressman 
Lamb is an extraordinary Member of Congress, he has very big 
shoes to fill.
    But we welcome you to the committee. We appreciate you 
being here.
    Mr. Butler, you may proceed.
    Mr. Butler. Chairman Maloney, Ranking Member Gibbs, members 
of the committee, thank you very much for the invitation to 
testify today.
    The subcommittee's focus on decarbonization of shipping is 
timely. This issue has been under discussion at the 
International Maritime Organization for a number of years. But 
the IMO's discussions and actions have become much more focused 
and urgent in the past 2 years.
    Mr. Chairman, as you referenced, in 2018 the IMO adopted an 
initial greenhouse gas strategy, and it has set numeric goals 
for reduction of greenhouse gases from international shipping.
    The first goal is a 40-percent increase in efficiency by 
2030. The second goal is a 50-percent reduction in absolute 
greenhouse gas emissions by 2050, versus a 2008 baseline. And 
thereafter, the strategy calls for emissions to be reduced to 
zero, or near zero, as soon as possible after 2050.
    The first goal, the efficiency goal for 2030, can most 
likely be met by wringing further efficiencies from fossil 
fuel-powered ships.
    The second goal, the 2050 goal, will require that we find 
new fuels and related technologies to replace fossil fuels. 
That is where the activities in the title of this hearing come 
into play: ``Investments and Innovation.''
    When we examined the progress being made on research and 
development to move shipping away from fossil fuels, it became 
clear that the scope of R&D underway today is insufficient to 
deliver the results that we need for deep-sea vessels. In 
response to that need to jumpstart R&D, we began work over 2 
years ago on a proposal to the IMO to create an industry-funded 
global R&D program focused on developing fuels and related 
technologies that can allow shipping to move away from fossil 
fuels. That work has resulted in a comprehensive proposal that 
we and seven other maritime organizations submitted to the IMO 
last month, and that full proposal has been included with my 
written testimony.
    This proposal, if adopted, would create a new body under 
the IMO that we have called the International Maritime Research 
and Development Board, or IMRB. Boiled down to its essence, the 
IMRB would manage a global, targeted R&D grant program funded 
by a mandatory contribution on each ton of fuel burned. Based 
on current global marine fuel consumption, this should generate 
between $5 and $6 billion in R&D funding over the next 10 to 12 
years.
    As you will see from my written testimony, we have 
addressed funding, governance, intellectual property, conflicts 
of interest, and many other details that have to be gotten 
right in order to make this proposal work. There are lots of 
details, but the logic behind why we made this proposal is 
quite simple.
    First, it is clear that we have to get beyond fossil fuels 
in order to make the dramatic cuts in greenhouse gases from 
shipping that are necessary to meet the IMO's goal.
    Second, today, we do not have the fuels and related systems 
that we can install on oceangoing vessels to meet those goals.
    Third, the current level of R&D work is not likely to 
deliver the necessary fuels and systems in time to meet the 
IMO's ambitious targets, particularly the 2050 target.
    And finally, the necessary level of research and 
development will not simply materialize by itself. So we need 
to take action now in an organized fashion to make sure that 
that work gets done.
    We look forward to working with the United States and other 
IMO member states to bring the IMRB into existence.
    I welcome your questions.
    [Mr. Butler's prepared statement follows:]

                                 
  Prepared Statement of John W. Butler, President and Chief Executive 
                    Officer, World Shipping Council
    Introduction: The World Shipping Council and the Liner Shipping 
                                Industry
    Chairman Maloney, Ranking Member Gibbs, and Members of the 
Subcommittee, thank you for the invitation to testify today. My name is 
John Butler. I am President and CEO of the World Shipping Council (WSC 
or the Council).\1\ The Council is a non-profit trade association whose 
goal is to provide a coordinated voice for the liner shipping industry 
in its work with policymakers, the public, and other industry groups 
with an interest in international transportation.
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    \1\ A complete list of WSC members and more information about the 
Council can be found at www.worldshipping.org.
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    WSC members comprise an industry that has invested hundreds of 
billions of dollars in the vessels, equipment, and marine terminals 
that are in worldwide operation today. Approximately 1,200 ocean-going 
liner vessels, mostly containerships, make more than 28,000 calls at 
ports in the United States during a given year--almost 80 vessel calls 
a day. This industry provides American importers and exporters with 
door-to-door delivery service for almost any commodity to and from 
roughly 190 countries. Approximately 35 million TEU \2\ of 
containerized cargo are currently imported into or exported from the 
United States each year. The container shipping industry is one of the 
most important facilitators of the nation's growth and on-going 
economic activity. Ocean shipping is also--by far--the most fuel-
efficient form of transportation on the planet.
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    \2\ A TEU is a twenty-foot equivalent unit. Most containers are 40 
feet in length and equal 2 TEUs.
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   Greenhouse Gas (GHG) Emissions and the Technological Challenge of 
                  Transforming the International Fleet
    The Subcommittee's focus on decarbonization of shipping is timely. 
This challenge is today the single largest issue under consideration by 
the International Maritime Organization (IMO), a specialized United 
Nations body that regulates international shipping. As discussed later 
in this testimony, the World Shipping Council and seven other shipping 
organizations last month submitted to the IMO a comprehensive proposal 
to establish a $5-6 billion research and development effort over a 10-
12 year period to identify the fuels and related technologies of the 
future that will be necessary for the maritime industry and to meet the 
aggressive decarbonization goals that the IMO has recently established. 
That program would be organized under the IMO, and it would be paid for 
by a fee on each ton of marine fuel burned.
    International ocean shipping, including all sectors (container, 
bulk, tanker, etc.), carries over 80% of the world's international 
trade and generates between 2-3% of global CO2 emissions. In 2018, the 
IMO adopted a resolution that set two goals for GHG reductions from 
shipping. The first goal is a 40% increase in overall fleet efficiency 
by 2030. The second goal is a 50% reduction in absolute emissions by 
2050 (versus a 2008 baseline), with emissions to be reduced to zero or 
near zero as soon as possible after 2050.
    It will likely be possible to meet the 2030 goal through a 
combination of the mandatory Energy Efficiency Design Index 
requirements for new ships that became effective in 2013 and new 
efficiency regulations covering the existing fleet that are expected to 
be adopted by the IMO in 2020. A highly competitive liner shipping 
market, fuel price increases associated with the IMO 2020 marine fuel 
sulphur cap regulation, and increasing societal and customer 
requirements to reduce emissions provide vessel operators with powerful 
incentives to make their operations as efficient as possible.
    In contrast to the likelihood that the IMO's 2030 GHG objectives 
can be met by operational and design measures applicable to a fleet 
that remains fossil-fuel based, the 2050 reduction goal and the move 
thereafter to a zero or near-zero GHG emission status for ocean 
shipping cannot be met by an industry that uses fossil fuels as its 
propulsion base. In order to meet the IMO's ambitious global GHG 
reduction goals, it is imperative that new fuels and related 
propulsion, fuel storage, and fuel infrastructure are engineered and 
deployed. Moreover, that transformation in the fuels used by ocean-
going vessels must begin in the near future in order for the change-
over to occur in time to meet the IMO's deadlines. Ocean vessels have a 
commercial lifespan of 20-25 years, which means that investment 
decisions made today will be with us for a generation. This means that 
we must act now to develop new fuels and related technologies if we are 
to avoid locking in fossil-fuel based vessels for a period that extends 
beyond the 2050 target date for the most drastic GHG reductions.
    The challenge that the industry faces is that, although there are 
promising possibilities for the fuels of the future, none of those 
candidate fuels are available today to be installed on large ships 
serving trans-oceanic routes. Hydrogen, ammonia, and other fuels have 
been identified as possible replacements for fossil fuels in marine 
applications, but these fuels present storage, handling, and production 
challenges that must be overcome before they are practically and safely 
available for widespread use. There may be additional options which 
have not yet received the same level of examination.
    Vessels that sail across oceans must obviously carry their fuel 
with them, and that means that fuels must be safe to handle and carry, 
must be energy-dense so that they do not displace too much cargo space, 
and must be widely available. All of these critical criteria represent 
technical challenges that will require substantial effort and 
engineering expertise to resolve. The solutions will not simply appear 
by themselves.
  The Proposal for an International Maritime Research and Development 
                                 Board
    Based on the introduction above, the baseline facts that the 
international shipping industry faces with respect to GHG reduction may 
be summarized as follows:
      The 174 member countries that participate in the 
International Maritime Organization have already set ambitious goals 
and deadlines for reductions in GHGs from shipping.
      The most ambitious of the IMO's GHG reduction targets 
cannot be met by a global vessel fleet that relies primarily or even 
substantially on fossil fuels.
      Although there are promising fuels and related 
technologies that may be practically applicable to trans-oceanic 
vessels at some point in the future, there are no low-carbon or zero-
carbon fuel/propulsion systems available today that can be used by 
large trans-oceanic vessels.
      Because ocean-going vessels are long-lived assets (20-25 
years), we must move as quickly as possible to develop and deploy low-
carbon and zero-carbon propulsion systems and fuels to avoid stranded 
assets and delays in implementing next generation technologies.

    As the industry evaluated this set of facts, it became clear that 
an essential component in meeting the IMO's deadlines for reducing GHGs 
from international shipping would be to create and support a dedicated 
research and development effort to identify and develop, for practical 
application, technologies that can replace fossil fuel propulsion for 
large ships. It also became apparent that, although there are a number 
of R&D efforts underway around the world, many of these are focused on 
short-sea applications or are not of a size and scale to be able to 
develop global solutions within the required timeline. Our focus 
therefore turned to the question of how the IMO could be used as the 
organizing body to create and sustain an R&D effort that could deliver 
the required solutions.
    The IMO is the only body in the world that is capable of bringing 
together the elements that are necessary for the successful creation 
and maintenance of an R&D effort of the size necessary to produce 
results within the time required. This is the case for several reasons:
      The IMO is the only existing body with the reach to 
coordinate a global R&D effort focused on commercial maritime 
transport.
      Any global R&D effort must have a mandatory industry 
financial contribution mechanism in order to generate necessary 
funding, avoid free riders, and maintain a level commercial playing 
field.
      In order to implement a sustainable funding mechanism, 
any effective industry-wide R&D program will need to have access to the 
IMO's fuel consumption database, as well as a defined communication 
procedure with flag states, both of which the IMO already has in place.

    Once we determined that the magnitude of the challenge and the need 
for quick action required a substantial and sustained R&D effort to 
find and develop the propulsion systems of the future, and we 
determined that the IMO was the right body to organize that effort, we 
began crafting a proposal to the IMO that describes how this critical 
R&D work can be undertaken and funded. After a period of over two years 
during which we consulted with IMO member states, environmental groups, 
technical experts, academics, and other industry groups, on December 
18, 2019, the World Shipping Council and seven other international 
shipping organizations submitted to the IMO a proposal to create the 
International Maritime Research and Development Board (IMRB).
    A copy of the comprehensive submission that we made to the IMO on 
the IMRB proposal is attached to my testimony as Exhibit A. Boiled down 
to its essence, the decarbonization research and development effort 
would be a global, targeted grant program funded by a mandatory 
contribution based on each ton of fuel burned. This is a detailed 
proposal that addresses a number of issues regarding the purposes and 
management of the IMRB that will have to be considered in order for the 
proposed R&D structure and effort to yield the necessary results. Among 
the issues addressed by the proposal are:
    1.  Research and development objectives of the IMRB.
    2.  Funding of the IMRB, including a structure that ensures that 
all funds are delivered directly to the IMRB, with no involvement of 
member country tax authorities.
    3.  Governance of the IMRB, balancing high-level IMO oversight with 
the need for an independent, knowledgeable board of directors and 
professional staff that is nimble and adaptable in deploying the assets 
of the IMRB to obtain effective research and development results.
    4.  Management of grants and contracts.
    5.  Provisions on conflict of interest.
    6.  Treatment of intellectual property generated through research 
efforts, balancing the need to incentivize participation by qualified 
experts, companies and institutions with the need for the results of 
IMRB-funded research to be made broadly available in order to encourage 
competition in developing next-generation fuels and supporting 
technologies.
    7.  Dissolution of the IMRB upon completion of its work.

    The IMRB proposal, if adopted by the IMO, would substantially 
accelerate and increase the scope of research and development work that 
is essential to decarbonizing shipping. That research is not occurring 
today on a schedule or on a scale that will yield results in time to 
meet the schedule set by the IMO, or at the speed increasingly demanded 
by society at large, and there is no indication that any one company or 
any one country would be willing or able to undertake such a research 
effort on its own. Luckily, we have in the IMO an existing 
international organization with global participation that is already 
deeply involved in the issue of decarbonizing shipping. All that is 
required in order to bring this powerful R&D tool into being is the 
political will to consider and adopt the IMRB proposal.
    We are optimistic that, as more IMO member states understand the 
IMRB proposal, the more they will support it. In addition to the fact 
that this is the only proposal currently before the IMO that seeks to 
directly implement decarbonization through research and engineering 
solutions, making this industry-funded investment in R&D makes business 
and policy sense. The alternatives to finding technological solutions 
that allow the ocean transportation industry to reduce and ultimately 
eliminate its carbon emissions are to either reduce the transportation 
services that support world trade or to continue on a path of 
increasingly burdensome and low-yielding regulations of a fossil-fuel 
powered industry. Neither of those outcomes--artificially constraining 
trade or chasing ineffective regulation--is desirable. Finding non-
fossil-fuel solutions will allow international ocean shipping to 
continue to grow to serve growing world trade, thus providing a 
sustainable path for both climate and economy. It is possible to de-
couple trade and GHG emissions, and for the former to grow while the 
latter declines.
    International shipping is by far the most efficient means of cargo 
transportation on the planet, and advances in ship design, size, and 
operational strategies have allowed containerships, for example, to 
increase their efficiency by as much as 50% over the past decade. These 
are impressive advances, but the fact is that over time these advances 
will be overtaken by trade growth, and it is not possible in the long 
run to reach the world's decarbonization goals for shipping by 
continuing to burn fossil fuels.
    Because we do not yet know what specific fuels and related 
technologies will replace fossil fuels, the logical next step is to do 
the research to answer that question and to make the next generation of 
fuels available for commercial deployment in the world's fleet. The 
IMRB proposal to the IMO provides the funding and the structure to make 
that essential R&D work happen, and we look forward to working with the 
United States and other IMO member states to bring the IMRB into 
existence.
                               exhibit a
                  International Maritime Organization
_______________________________________________________________________
                 REDUCTION OF GHG EMISSIONS FROM SHIPS
     proposal to establish an international maritime research and 
                        development board (imrb)

[Exhibit A is retained in committee files and is available online 
following page 6 of Mr. Butler's prepared statement at https://
docs.house.gov/meetings/PW/PW07/20200114/110356/HHRG-116-PW07-Wstate-
ButlerJ-20200114.pdf.]

    Mr. Maloney. I thank the gentleman.
    Dr. Kindberg, am I saying your name correctly?
    Ms. Kindberg. [No response.]
    Mr. Maloney. Dr. Kindberg, am I pronouncing your name 
correctly?
    Kindberg? See, I knew there was a good chance I had that 
wrong, so forgive me.
    Dr. Kindberg, you may proceed.
    Ms. Kindberg. Thank you. Chairman Maloney, Ranking Member 
Gibbs, and members of the committee, thank you for the 
invitation to speak today.
    Ocean shipping has the most energy-efficient way to move 
cargo long distances, and has the lowest carbon footprint per 
unit shipped of any mode of transportation. Ships use very 
large diesel engines to move those mountains of cargo. Think 
80,000 horsepower engines with great big cylinder heads. And 
that creates greenhouse gases and other pollutants coming out 
of the exhaust. Shipping generates 2 to 3 percent of all 
manmade greenhouse gases.
    Since 2008, Maersk has reduced our greenhouse gas and other 
emissions by 42 percent per container moved, 42 percent since 
2008. And I might mention that your colleague, Congressman 
Lowenthal, has been with us, encouraging and sometimes pushing 
us, all the way since about 2006 on this.
    Now our customers and other stakeholders are now asking us 
to do more, to go all the way to zero-carbon shipping. And a 
year ago we made a commitment to do just that, to achieve zero-
carbon shipping by 2050. Now, that sounds like a distant and 
rather fluffy goal, but the lifetime of a vessel is 20 to 25 
years. So let's think through this.
    And we, by the way, operate 700 vessels. So to have zero 
emissions for the whole fleet by 2050, that means we have to 
have the first commercial vessel on the water by 2030, which 
means that we have to order it by 2028, which means we have to 
have designed it by 2027, which means we have got the next 5 to 
7 years to define what is going to go into that design.
    This is not a distant goal. This is a major transformation, 
and we can't do it alone.
    We are continuing our cutting-edge efficiency work with a 
goal of 60-percent reduction by 2030. We are already testing 
biobased fuels, batteries, and other technologies, some of them 
actually on commercial vessels. As we speak, our first net-
zero-carbon shipments are on a ship headed back from Singapore, 
using a renewable biofuel blend made from used cooking oil. And 
we are developing new renewable fuels, including one that 
involves ethanol and lignin from plants and wood.
    But the biggest challenges ahead are not just on the ships. 
The land-based industries and infrastructure must be there to 
supply the fuels and technologies at scale, and we must do it 
without jeopardizing food production or forests. Economic and 
policy systems must also adapt to support this transformation.
    So what we need to make this happen, first, focused R&D, 
which, of course, Mr. Butler discussed; alignment between 
national, State, and international goals, and the legal systems 
that support them. The International Maritime Organization sets 
the rules for international shipping and has set metrics and 
goals for vessel emissions.
    Requirements also need to be clearly written and well 
enforced, and encourage early action, but not penalize early 
actors. And yes, we advocate for strong enforcement, and we are 
doing so globally. We need a level playing field. And we count 
on enforcement to make that happen.
    Now, let me give a recent example to show the importance of 
this. A couple of you mentioned the 2020 fuel rule, which 
reduced sulfur significantly. And most of the global fleet has 
started complying with that. And, of course, it just went into 
effect a couple of weeks ago. But where--most of us are 
complying with that, using cleaner fuels. It is expensive, 
cleaner fuels. It is going to cost my company $2 billion a 
year. So it is very expensive. And we fully support the goals, 
and we are complying.
    But the temptation is probably out there for others. A 
vessel sailing from Asia to Europe could save close to $750,000 
for one ship on one voyage by ignoring the new rule. Companies 
rely on good enforcement to provide the level playing field 
necessary for competitiveness and environmental progress. The 
same strong enforcement concepts will need to be fundamental 
components of any climate-related programs, too.
    Ladies and gentlemen, the transformation to low- or zero-
carbon shipping is an energy transformation, not just a vessel 
modification. Huge changes to both vessel and land-based 
infrastructures must happen to produce and distribute those new 
energy sources, and policies and laws must adapt to enable that 
change.
    Therefore, thank you for this opportunity to be part of the 
conversation.
    [Ms. Kindberg's prepared statement follows:]

                                 
 Prepared Statement of B. Lee Kindberg, Ph.D., Head of Environment and 
                  Sustainability-North America, Maersk
    Chairman DeFazio, Chairman Maloney, Ranking Member Gibbs, and 
Members of the Committee, thank you for the invitation to testify 
today.
    Maersk is the world's largest container shipping company and has 
long been committed to environmental leadership in our operations. We 
are headquartered in Copenhagen Denmark and operate over 700 container 
vessels globally, as well as our APMT marine terminals, Svitzer ocean-
going tugs, and other supply chain logistics facilities in North 
America and around the world.
    Maersk is committed to ensuring that our business practices are 
safe, responsible and transparent. Our vision and priorities are 
discussed in more detail in our Sustainability Reports, available on 
our website at https://www.Maersk.com/en/business/sustainability.
    Our global Sustainability Strategy identifies four key 
sustainability priorities, our Shared Value Programs:
    1.  Decarbonizing logistics,
    2.  Contributing to halving food loss,
    3.  Helping to multiply the benefits of trade in developing 
regions,
    4.  Leading change in the global ship recycling industry.

    Our most significant environmental impact is the air emissions 
produced by fuel consumption in our ships' very large diesel engines. 
These include both Greenhouse gases (primarily CO2, often referred to 
as ``carbon'') and criteria air pollutants (SOx, NOx, fine particles).
    The shipping industry emits 2-3% of the world's anthropogenic CO2 
and is the only industry to have set global metrics and goals on energy 
efficiency, greenhouse gas emissions and other pollutants such as 
sulfur.
    Maersk alone emits approx. 0.1% of this CO2, so decarbonization is 
a cornerstone in our sustainability strategy. Our first focus is on 
ocean transport, which is the source of 98% of our ``Scope 1 
emissions.'' Decarbonization goals will be extended to our marine 
terminals and other logistics services and transport modes over the 
coming years.
    Reducing fuel consumption reduces operating costs and also reduces 
emissions of both greenhouse gases and criterial pollutants. In the 
last decade Maersk has reduced our fuel consumed and related emissions 
by 42% per container moved. This energy efficiency improvement was 
achieved in three primary ways: new larger vessels, retrofits of our 
existing vessels, and improved operational and vessel management 
practices.
    In December 2018 Maersk announced a goal of Net Zero Carbon 
Shipping by 2050. That commitment means we are working to launch our 
first zero carbon vessel by 2030. We are also continuing our energy 
efficiency work with a 2030 goal of a 60% reduction in emissions vs. 
2008.
    A prerequisite for Maersk to meet the Net Zero 2050 target is 
radical innovation in technologies and fuels. We have openly recognized 
the need for close collaboration with external stakeholders such as 
technology providers, investors, legislators and especially our 
customers to meet the target.
                              Investments
    We are approaching full implementation of the Radical Retrofit 
program, a $1Billion investment commitment over 5 years started in 
2015. We also continue to make significant progress on maturing, 
hardening and fully implementing the ``Connected Vessel'' 
digitalization project. This program is connecting our fleet digitally 
with our global operations coordination centers and enables real-time 
optimization of operational conditions to reduce fuel consumption and 
related emissions. These programs are successfully delivering increased 
efficiencies and reduced emissions.
    Maersk's recent announcement of Net Zero Carbon emissions by 2050 
comes with significant plans for future investments, including further 
energy efficiency work, alternative fuel development, and the 
technologies needed to build zero carbon vessels.
                   Action on Zero emissions shipping
    As an industry leader Maersk feels a great responsibility to do our 
part to fight climate change and reduce our impacts significantly. 
Significant innovative solutions must be developed and start to be 
implemented by 2030 in order to meet the goal of net zero carbon 
emissions by 2050 from our vessel operations.
    Maersk is already engaged in several innovation projects and is 
significantly scaling up our innovation efforts. Currently we have more 
than 50 engineers in our technical innovation departments who focus 
primarily on reducing fuel consumption, and we are hiring more as we 
speak to broaden our efforts. At this point we are not ruling out any 
technological options and the innovation work covers many areas 
including the following:
    1.  Continue our cutting-edge fuel efficiency efforts such as 
retrofitting existing vessels with new technologies and setting new 
standards on fuel efficiency when we order new vessels. Maersk does not 
purchase standard vessels; we always optimize designs, with close 
collaboration between our technical experts and the ship yards.
    2.  Electrification. We are preparing an installation of a major 
battery on a vessel during 2020 to learn how this technology might be 
useful on a vessel and to drive further development on the technology. 
Our work in this area will increase significantly going forward. We 
also now connect vessels to shore power in California and China, 
allowing us to operate in port without emissions.
    3.  Research in new alternative fuels. We have a range of programs 
exploring new marine fuels, including several programs related to 
biofuels. Examples include:
        Biofuel-based ECO-Delivery: A pilot voyage in April-May 
2019 used renewable biofuel blends made from used cooking oils on an 
Asia-Europe roundtrip to prove applicability and test commercial 
opportunities. This successful trial was conducted together with 4 
major customers. This success led to a new Net Zero Carbon shipping 
service called ``ECO-Delivery.'' The first commercial voyage including 
ECO Delivery shipments is currently on the water.
        Lignin Ethanol Oil (``LEO'') biofuel: Maersk, together 
with a coalition of US-based and international customers and in 
collaboration with the University of Copenhagen, has establishing a new 
sustainability innovation project to develop a biofuel tailor-made for 
shipping (LEO). This biofuel does not exist today but has the potential 
to have significant positive impact on CO2 emissions as well as other 
air emissions from shipping.

         The concept is to blend bio-based ethanol with the biopolymer 
lignin (a by-product of agriculture, paper making and wood-products 
production) to form a new relatively inexpensive biofuel with high 
energy content. The LEO biofuel should be a sustainable fuel meaning 
that it is: 1) Made from waste/by-products not competing with food 
uses--a 2nd generation biofuel, 2) Should be CO2 neutral, and 3) is 
economically feasible and price competitive with conventional fuels (or 
only small price premium). The current objectives of the LEO project 
are to confirm the feasibility of the fuel, test it on a vessel, and 
make it commercially feasible for uptake in the shipping industry.
   The need for strong enforcement of climate and air emissions rules
    As of 1 January 2020, all ships had to cut their SOx emissions by 
over 80%. This has been a major and comprehensive transition and the 
vast majority of the global fleet (including Maersk vessels) has done 
so by switching to low sulfur fuel. This comes at a very steep price; 
for Maersk alone, the additional bill is estimated to be around $2 
billion per year. Maersk fully supports the IMO2020 Regulation and will 
naturally respect it.
    However, given the very large potential savings by non-compliance, 
we would like to emphasize the need for strong enforcement and adequate 
fines to deter non-compliance. Such fines should as a minimum cover the 
total amount saved by non-compliance including the part of the voyage 
on the high-seas. For example, a vessel trading from Asia to Europe 
could ``save'' close to $750,000 USD per ship per voyage by ignoring 
the IMO2020 rules. Companies rely on good enforcement to provide the 
``level playing field'' necessary for competitiveness and environmental 
progress.
    The same strong enforcement concepts will need to be fundamental 
components of any climate-related programs. When developing climate 
programs at the national and international level it is of utmost 
importance to secure that mechanisms are in place to ensure that 
international competition is not disrupted and that first movers are 
rewarded for early investments into emissions reducing technology.
    In closing let me paraphrase one of our senior leaders who stated 
that the main challenge in the transformation to low or zero emissions 
shipping is not at sea but on land. The technological changes inside 
the vessels are minor compared to the massive innovative solutions and 
fuel transformation that must take place to produce and distribute 
entirely new energy sources.
    Thank you again for the opportunity to provide this input.

    Mr. Maloney. Thank you, Dr. Kindberg.
    Mr. Bryn, am I saying your name correctly?
    Mr. Bryn. Yes, thank you.
    Mr. Maloney. Thank God. You may proceed, sir, thanks.
    Mr. Bryn. I have gotten a lot of versions, so that--you got 
it. Thank you.
    Chairman Maloney, Ranking Member Gibbs, members of the 
subcommittee, and my fellow panelists, good morning and thank 
you for the opportunity to testify on this incredibly important 
topic.
    ABB has been an electrification and automation leader for 
over a century. With 147,000 global employees, 24,000 of which 
are here in the U.S., we are a market leader in power grids, 
advanced manufacturing, and electric transportation. For 
example, ABB has deployed over 13,000 electric vehicle fast 
chargers, worldwide. ABB has 60 manufacturing sites in the 
U.S., with domestic headquarters in North Carolina, and global 
headquarters in Switzerland.
    One example of ABB's marine technology is aboard the U.S. 
Coast Guard Great Lakes icebreaker, Mackinaw, where ABB 
provided our electric azipod propellers and the vessel's 
integrated diesel-electric power system.
    ABB is excited to help lead the maritime industry toward 
zero emissions, as climate change is one of the greatest 
challenges of our time. ABB supports the Paris Agreement to 
avert the potentially devastating consequences of climate 
change. As a company with 9,000 technologists set to invest $23 
billion in innovation through 2030, ABB urges policymakers to 
adopt sound and predictable climate policies to encourage 
innovation.
    Today I would like to cover three main points: the current 
state of marine technology, the opportunity to lower life-cycle 
costs and emissions, and how the Federal Government can help 
speed adoption.
    Globally, the maritime industry remains dominated by diesel 
power, but the beginnings of a significant shift are underway. 
For many vessels the first step is to electrify the propulsion 
system, meaning the propeller is directly powered by an 
electric motor. This arrangement allows for any energy sources 
to provide the power from diesel or LNG generators, to 
batteries, to fuel cells. In the near term, this can help many 
Jones Act vessels reduce their emissions. Longer term, this 
makes it far easier to retrofit low-carbon technologies as they 
commercialize.
    So what zero-emission solutions are available today? It is 
critical to fit the right solution to each vessel's needs. And 
in the U.S. there are three primary vessel segments to 
consider: tugs and towboats, passenger vessels, and oceangoing 
vessels.
    Let's begin with ferries, as they have become one of the 
pioneering vessel types for zero-emission battery deployment. 
This is because they operate a predictable schedule to just a 
few ports, meaning batteries can be sized with confidence, and 
only limited shoreside charging infrastructure is required.
    As an example, ABB is proud to be powering the new Maid of 
the Mist tour boats in Niagara Falls, which will become the 
first new-build, all-electric vessels in the U.S. when they 
enter service this spring. The battery banks on these 500-
horsepower boats will be recharged in 7 minutes between each 
voyage. Much larger will be the Washington State Ferries fleet, 
which operates throughout Puget Sound, as this organization has 
committed itself to an all-electric future.
    But what about tugs, towboats, and oceangoing vessels? 
Well, that, too, depends on their operating profile. For 
example, many harbor tugs, inland towboats, and dredgers spent 
significant time at idle or low load, which is inefficient for 
the diesel engine. For these vessels, a diesel-electric plant 
with a battery can help optimize engine efficiency, while 
significantly reducing engine hours.
    Conversely, for vessels that spend most of their time near 
full power, like a product tanker, containership, or linehaul 
towboat, the diesel engine already operates quite efficiently. 
And so installation of a shaft generator and/or fuel switching 
to LNG or biofuels may be more appropriate in the near term.
    But despite these near-term improvements, to get to zero 
emissions, new technologies like hydrogen fuel cells must be 
considered. ABB is already working with smaller commercially 
available fuel cells, and is jointly developing a 3-megawatt 
marine fuel cell with Ballard Power Systems for oceangoing 
vessels. In France, ABB is proud to be powering what will 
become the world's first fuel-cell-powered towboat.
    With that, I would like to close with a few policy 
opportunities to support the transition to a zero-emission 
marine future.
    First, green the Federal fleet. The U.S. Government is a 
globally leading shipowner. And, as such, it can use its buying 
power to deploy cost-effective advanced technologies for its 
own vessels.
    Two, support financing mechanisms and direct funding for 
private-sector, zero-emission vessels. While the total life-
cycle cost of an electrified vessel can be lower than a diesel-
mechanical equivalent, the upfront costs are often higher. This 
investment can still be a challenge for shipowners, and so 
financial support for early adopters to help build volume will 
bring down costs, long term, for the private sector.
    Three, invest in research and development. While there are 
commercially available solutions today for some marine 
segments, continued technology improvement is needed to serve 
more challenging vessel applications.
    I thank you again for the opportunity, and look forward to 
your questions.
    [Mr. Bryn's prepared statement follows:]

                                 
  Prepared Statement of Peter Bryn, Technical Solutions Manager-North 
                     America, ABB Marine and Ports
                           Executive Summary
    ABB has been an electrification and automation technology leader 
for over a century. With about 147,000 employees across the globe and 
24,000 here in the US, we are a market leader in power grids, advanced 
manufacturing technology, and electric transportation. This includes 
electric vehicle charging infrastructure as well as marine and port 
electrification and automation solutions. The marine industry in the 
early stages of a transformation to low and zero emissions 
technologies. While there is no one-size fits all approach to reducing 
marine emissions, ABB believes the future of marine vessels will be 
electric, digital, and connected.
    1.  With electric propulsion systems, marine vessels can get to 
zero emissions. Most alternative propulsion system arrangements are 
centered around an electric powertrain, including diesel or LNG 
electric hybrids ships, full battery powered ships, and fuel cell 
powered ships. Electric propulsion not only cuts emissions but also 
improve safety and reliability while reducing lifecycle costs. An 
electric-based powertrain is also futureproof as new power sources are 
developed. Whether the power source is fuel cells, batteries, ammonia-
fueled generators, or a wave energy harvesting system, electric 
powertrains can integrate them. This is especially important for Jones 
Act vessels which often undergo multiple repowers over their sometimes 
50+ year lives.
    2.  It's critical to fit the right solution to the vessel. Vessel 
types are as varied as the missions they serve and cargoes they carry. 
Ferries, inland towboats, harbor tugs, offshore workboats, and 
oceangoing vessels all have different operational characteristics that 
require different low or zero emission technologies. Fortunately, there 
are a number of such technologies either available today or under 
development including diesel or LNG electric hybrids, biofuels, fuel 
cells, and batteries. Accordingly, policies should focus on setting 
emissions targets for the marine industry, allowing the industry to 
assemble the best technology solution for meeting emissions and 
operational goals, and providing support to the marine industry as they 
meet those targets.
    3.  Lifecyle costs of electric powertrains are typically lower than 
conventional diesel powered vessels. Vessels with electric powertrains 
and direct current (DC) electrical systems typically cost less to 
operate over their lifetime due to higher energy efficiency, lower 
maintenance, and reduced fuel costs. However, their upfront capital 
costs tend to be higher. This challenge is similar to other recent 
energy technology breakthroughs, like wind and solar power and electric 
vehicles. However, through a myriad of research, development, and 
deployment policies and incentives, those upfront costs have come down 
considerably and have reached or are approaching cost parity. With 
appropriate support, the same will happen with zero emission marine 
technologies.
    4.  Low and zero emission marine vessel technologies are in the 
early stages of adoption and need government and policy support. Today 
there are commercially available zero emission marine technologies for 
some segments, like ferries. However, they tend to be more expensive 
upfront to purchase, which is a big deterrent to ship owners and 
operators, even though they are cheaper to operate. For other segments 
like offshore workboats, and oceangoing vessels, cost-effective 
commercially available zero emission solutions are still in their very 
early stages of development. To lower costs and reach a fully zero 
emission vessel fleet, deployment of existing technology and 
development of new technology must be expedited. The industry would 
benefit from government investments in research, development, and 
deployment of zero emission marine technologies.
                              Introduction
    Good morning Chairman DeFazio, Chairman Maloney, Ranking Member 
Graves, Ranking Member Gibbs, members of the Subcommittee and my fellow 
panelists. Thank you for the opportunity to testify today. My name is 
Peter Bryn and I am Technical Solutions Manager in ABB Inc.'s Marine 
and Ports Business Line.
    ABB is an electrification and automation technology leader that is 
driving digital transformation of industries. With a history of 
innovation spanning more than 130 years, ABB has four customer-focused, 
globally leading businesses: Electrification, Industrial Automation, 
Motion, and Robotics & Discrete Automation, supported by ABB AbilityTM 
digital platform. With about 147,000 employees across the globe, we are 
a market leader in power grids, advanced manufacturing technology, and 
electric transportation. This includes electric vehicle charging 
infrastructure and marine and port electrification and automation.
    ABB is proud of our 24,000 US employees along with our 60 US 
manufacturing or assembly sites and significant operations in 32 
states, including Arkansas, Missouri, Ohio, Oregon, Pennsylvania, 
Tennessee, Wisconsin, and North Carolina which is home to our U.S. 
headquarters. Our global headquarters is in Zurich, Switzerland. Over 
the past decade we have invested over $14 billion in the United States, 
more than tripling our workforce.
                  ABB Commitment to Reducing Emissions
    Climate change is one of the biggest challenges of our time. ABB 
supports the Paris Agreement, which came into force in November 2016, 
and considers it the linchpin of efforts to limit global warming and 
avert the potential devastating consequences of climate change. ABB 
actively contributes to climate goals by encouraging the early and 
rapid adoption of clean technologies and by helping its customers 
improve energy efficiency and productivity while extending the 
lifecycles of their equipment and reducing waste.
    Meeting the goals of the Paris Agreement will require significant 
investment in new and upgraded technologies, which will only be 
forthcoming with solid, reliable, and predictable policymaking. As a 
company with around 9,000 technologists that is set to invest around 
$23 billion in innovation between the signing of the Paris Agreement 
and 2030, ABB urges policymakers to adopt sound climate policies to 
encourage innovation and create secure investment conditions.
    ABB understands that investments in developing and deploying 
technologies that reduce climate impacts, while incrementally higher 
cost at first, lead to significant intermediate and long-term cost 
savings. Such technologies are core to ABB, as nearly 60 percent of 
ABB's global revenues are derived from technologies that directly 
address the causes of climate change through energy efficiency, 
renewables integration, and resource conservation. The marine sector 
also holds a similar promise of reducing emissions and overall costs.
    ABB's contributions to climate goals are widely acknowledged and 
were recognized in August 2018 by ``Fortune'' magazine, which named ABB 
as one of the top 10 companies that are changing the world. ABB has set 
its own target to reduce its GHG emissions by 40 percent by 2020 from a 
2013 baseline.
                       Reducing Marine Emissions
    We are in the very early stages of a transformation of the marine 
industry to low and zero emissions technologies. While ports have 
already begun their march toward electrification, which enables zero 
emission operations, the marine sector is just beginning. ABB provides 
ship and port electrification and automation technologies and 
solutions. From replacing diesel powered cranes at ports with electric 
solutions powered by microgrids, to fully electrifying marine vessel 
propulsion systems, and everything in between, we believe the future of 
the maritime industry will be electric, digital, and connected. These 
technologies are used in ports across the US, from Charleston, South 
Carolina to Long Beach, California. And the Coast Guard has deployed 
one of ABB's advanced diesel-electric hybrid propulsion systems on the 
Great Lakes Icebreaker, the USCGC Mackinaw.
Global Adoption of Zero Emissions Technology
    Globally, the maritime industry remains dominated by diesel-power, 
but the beginnings of a significant shift in energy source is underway. 
The start of adoption of low to zero emission ship technology is shown 
in Figure 1. While conventional power plants still dominate, a 
significant jump in both battery powered and liquified natural gas 
(LNG) ships is evident in Figure 2.

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         Figure 1. Alternative fuel by ship count (DNVGL, 2018)

    By vessel type, certain technologies are emerging because they 
complement the vessel's operational profile. For example, ferries are 
great candidates for batteries because of their short distance 
operation and predictable port calls, which allow for installation of 
shore chargers. Conversely, container ships travel long distances and 
have incredibly high power demands. Because battery and fuel cell 
technologies need more research and development to be able to meet 
oceangoing vessels' needs cost-effectively, these ship owners and 
operators have begun adopting LNG.

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         Figure 2. Alternative fuel by ship type (DNVGL, 2018)

An Electrified Propulsion System
    Most alternative propulsion system arrangements are centered around 
an electrified powertrain. Whether diesel or LNG electric hybrids, full 
battery power, or fuel cell power, most low and zero emissions vessels 
will employ an electrified powertrain. Electric propulsion can not only 
cut emissions but also improves safety and reliability while reducing 
lifecycle costs. An electric-based powertrain is critical as it allows 
for easy integration of current and future power sources, which is 
important for Jones Act vessels that often undergo multiple repowers 
over their sometimes 50+ year lives.
Fitting the Right Solution
    Vessel designs vary significantly, based on the vessel's 
application and purpose. The low and zero emission technologies that 
will be selected for a particular project will be dictated by the needs 
and operational profile of the vessel. These technologies may include:

------------------------------------------------------------------------
           Low Emissions                      Net Zero Emissions
------------------------------------------------------------------------
 Diesel-Electric              Full Battery-Electric
 Diesel-Electric with         Propulsion and Shore Charging
 Battery                              Fuel Cell with Net-zero
 Diesel-Electric with         Fuel
 Battery and Shore Charging           Biofuels (some)
 Power Take In/Take Off       Ammonia
 (PTO/PTI)
 LNG/dual-fueled engines
 Biofuels (some)
 Fuel Cell with Fossil-
 Derived Fuel
------------------------------------------------------------------------

    It is critical that ship owners and operators identify the proper 
solution for their vessel whether using a conventional diesel engine 
arrangement or some combination of low or zero emissions technologies. 
For example, a harbor tug which operates with a significant amount of 
idle time and short bursts of full power during operation has a very 
different operational profile than a Very Large Crude Carrier (VLCC) 
tanker which trades internationally on the spot market across oceans 
and can spend days at anchorage. Failing to consider the vessel's 
operation may lead to a propulsion system that is less efficient and 
cost effective than the diesel-mechanical baseline.
    ABB is working with many Jones Act vessel owners, operators, and 
designers to seek the best solution for their operation. This ranges 
from ferries to fishing boats, harbor tugboats to dredgers, and 
passenger vessels to river towboats.
    Across segments, some recurring challenges persist. First, while 
the total lifecycle cost of ownership of a vessel with electric 
propulsion is lower than a diesel-powered vessel, the upfront costs are 
often higher. Second, research, development, demonstration, and 
deployment investments are needed to bring down costs of these new 
systems and commercialize zero emissions solutions for more challenging 
applications like high speed catamarans and oceangoing cargo vessels.
US Newbuild Market
    In the private sector, newbuild construction in the US is largely 
dominated by Short Distance Shipping (SDS) vessels, particularly tugs, 
towboats, and passenger vessels. By comparison, there is a small number 
of Oceangoing Vessels (OGV), as per Figure 3.

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        Figure 3. Recent US newbuild construction (Colton, 2019)

    There are some exciting opportunities for Jones Act oceangoing 
vessels in the burgeoning offshore wind market, government fleet, 
offshore oil/gas activity, and larger cargo vessel markets. However, 
the bulk of this testimony will focus on the coastal and inland vessel 
markets, where most US newbuild construction is occurring.
                  Common US Vessel Types and Solutions
Road and Passenger Ferries
    Ferries have become one of the pioneering vessel types for zero-
emission battery deployment because they combine generally shorter 
routes with regular port visits. The shorter routes allow installation 
of battery packs that can fully power the vessels on their journeys 
while the predictable routes and turnaround times enable efficient 
deployment of shoreside charging infrastructure.

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----------------------------------------------------------------------------------------------------------------
 
----------------------------------------------------------------------------------------------------------------
Operational profile......................    Fixed route, limited distance, not overly weight sensitive, volume
                                                                                                        limited
Conventional solution....................                                        Diesel mechanical to propeller
Reduced emission solution................       Diesel electric with battery with propulsion motor to propeller
Zero emissions solution..................                   Battery-electric with propulsion motor to propeller
Common challenges........................                       Charging infrastructure, utility demand charges
----------------------------------------------------------------------------------------------------------------

    For these reasons, it's unsurprising that the ferry industry is 
among the first marine segments to adopt full battery-electric 
solutions. The first fully electric, battery-powered vessels to be 
built in the US are the two new Maid of the Mist ferries being powered 
by ABB. These Niagara Falls tour boats will be powered by a pair of 
battery packs with a total capacity of 316 kWh, split evenly between 
two catamaran hulls creating two independent power systems providing 
full redundancy.
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                  Figure 4. New Maid of the Mist Ferry

    The vessels will charge between every trip while passengers 
disembark and board. Shoreside charging will only take seven minutes, 
allowing the batteries to power the electric propulsion motors capable 
of a total 400 kW (563 HP) output. This will all be controlled by ABB's 
integrated Power and Energy Management System (PEMS), which will 
optimize the energy use on board.
    From small to large, most ferry boats and routes can be 
electrified. In 2018, two ForSea Ferries, operating between Denmark and 
Sweden, became the largest battery powered ferries, following an ABB-
led conversion.


                        Figure 5. ForSea Ferries

    Economics play a large part in the push toward electrification. 
While zero emission boats tend to have higher capital costs, 
operational costs are much lower than diesel powered ships, making them 
more cost-effective over the lifetime of the vessel. Figure 6 is an 
example for an existing ferry opportunity where the battery electric 
option (Case E) is more expensive up front, but because it costs less 
to operate, the ship owner or operator ends up saving $800,000 over the 
life the vessel. Just like with electric vehicles, increased 
deployments, financing support, as well as research and development can 
help lower the upfront capital cost of zero emission options.
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      Figure 6. Example of Project Economics for ABB Ferry Project

    In addition to the cost savings of choosing a zero emission 
solution, the CO2 emissions reductions are stark, as shown in Figure 7. 
A significant reduction of CO2 is shown in the battery electric option, 
which assumes an emissions profile in line with the energy generation 
mix of the power grid in California.
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 Figure 7. Example of Project Emissions Estimate for ABB Ferry Project

Harbor Tugs
    Like ferries, harbor tugboats operate on short routes and typically 
return to the same port every evening. However, unlike ferries, they 
have significant idling time and higher power demands. To reduce 
emissions, a diesel-electric system with a smaller diesel generator and 
a battery bank can satisfy onboard power requirements when stationary 
while being ready to provide maneuvering power in an instant.
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----------------------------------------------------------------------------------------------------------------
 
----------------------------------------------------------------------------------------------------------------
Operational profile......................                 60% idle time, 35% at <40% power, <5% at full power
Conventional solution....................                                        Diesel mechanical to propeller
Reduced emission solution................          Diesel electric with peak shaving battery, possibly plug-in,
                                                                                  propulsion motor to propeller
Zero emissions solution..................  Battery-electric or fuel cell-electric, propulsion motor to propeller
Common challenges........................     Space for battery room, sometimes unpredictable periods away from
                                                                                                           dock
----------------------------------------------------------------------------------------------------------------

    Figure 8 is an example of a typical tugboat use-case where a 
smaller diesel-electric powertrain paired with smaller battery for peak 
shaving (Cases C) or a larger battery for propulsion to be charged at 
port (Case D) were recommended by ABB. Like the ferry example above, 
despite higher upfront capital costs, the lower operating costs of an 
electric propulsion system can save the ship owner operator over $6m 
over the life of the vessel. Programs that address upfront capital 
costs will help increase deployments of low emission technologies and 
enable price reductions that come with scale and experience. For 
example, a low-interest loan program to cover the difference in capital 
cost could increase adoption.
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     Figure 8. Example of Project Economics for ABB Tugboat Project

Inland Towboats
    Inland towboats operate under a wide range of profiles. Factors 
like voyage length and consistency of docking schedule will drive 
either a battery-electric or fuel cell-electric solution. Less 
ambitious emission reductions can be achieved using a diesel-electric 
hybrid system with a battery.
    ABB is proud to be providing a complete fuel cell-electric power 
system for what will become one of the world's first fuel cell powered 
towboats, which will be operated by Compagnie Fluviale de Transport 
(CFT) of France.
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----------------------------------------------------------------------------------------------------------------
 
----------------------------------------------------------------------------------------------------------------
Operational profile......................                                     Unit tows: varying length voyages
                                                          Shuttle boat: short distance transits, long idle time
                                                   Fleeting boat: stays local to fleet moving barges in and out
                                                                                                               Linehaul boat: regular long-distance hauls
Conventional solution....................                                        Diesel mechanical to propeller
Reduced emission solution................                  Unit tows, shuttleboat: Diesel electric with battery
                                                                                Fleeting boat: Battery-electric
                                                                                                               Linehaul boat: PTO/PTI
Zero emissions solution..................            Unit tows, shuttle boat, linehaul boat: Fuel cell-electric
                                                                                Fleeting boat: Battery-electric
Common challenges........................            Highly capex-focused market, cautious about new technology
----------------------------------------------------------------------------------------------------------------

Offshore Workboats
    Offshore workboats have yet a different operational profile. Many 
have long dwell-times when servicing offshore assets like a wind farm 
or oil and gas rig, while also needing onboard power for ancillary 
service-related systems. A first step to reduce emissions for these 
workboats is to add batteries to a diesel-electric system. The 
batteries can be used to optimize diesel performance by assuming the 
very transient loads arising from the podded thrusters as they start 
and stop while in dynamic positioning mode. The diesel may shut off 
completely, or if running can operate at an optimal, steady point and 
avoid constantly ramping up and down. A movement to zero emissions will 
likely entail a fuel cell-electric propulsion system with battery.
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----------------------------------------------------------------------------------------------------------------
 
----------------------------------------------------------------------------------------------------------------
Operational profile......................          Varied, but often have high dwell times and significant non-
                                                                                               propulsive loads
Conventional solution....................              Varies, but often diesel-electric with podded propulsors
Reduced emission solution................          Diesel-electric with battery storage for optimized operation
Zero emissions solution..................                               Fuel cell-electric with battery storage
----------------------------------------------------------------------------------------------------------------

    ABB is proud to have powered the NKT Victoria, a specialized 
offshore cable-laying workboat, with ABB's Onboard DC Grid system and 
achieved a remarkable 60% CO2 reduction versus a comparable vessel. 
This was achieved both because of greater efficiency in the propulsion 
system, but also due to operational changes that the electrified system 
permitted.
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                         Figure 9. NKT Victoria

Oceangoing Cargo Vessels
    Oceangoing cargo vessels often have predictable operational 
characteristics, however their long distance routes, coupled with very 
short port stays, make full battery-electric propulsion systems 
challenging. The first step toward reducing emissions is to use an 
alternative fuel like LNG or biofuel, and potentially adding battery 
storage. A move toward zero emissions would likely incorporate a fuel 
cell-electric propulsion system, which ABB is developing for this need.
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--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                      At Sea                                    In Port
--------------------------------------------------------------------------------------------------------------------------------------------------------
Operational profile...............................................  Most spend long periods of time at sea with limited port turnaround time
Conventional solution.............................................            Slow speed diesel to propeller      Operate diesel-powered generators and
                                                                                                                                           steam boiler
Reduced emission solution.........................................                 Alternative fueled (e.g. LNG, DCold ironing (vessel plugs into local
                                                                                       possibly with battery                    shore power) or battery
Zero emissions solution...........................................  Fuel cell-electric with propulsion motor to propeller, or engine with net-zero fuel
                                                                    (e.g. ammonia, biofuel) direct to propeller
--------------------------------------------------------------------------------------------------------------------------------------------------------

    While in port, achieving zero emissions is possible for some 
vessels today by connecting to a shoreside power source, often called 
``shore power,'' ``ship to shore,'' or ``cold ironing''. ABB has 
provided a number of cold ironing installations across the globe 
involving both the onboard and shoreside equipment. There are 
challenges to cold ironing as most older vessels are not outfitted to 
accept shore power and not all ports are currently equipped to support 
it. Cold ironing can be of limited value if there are substantial non-
electric loads (e.g. crude oil tanker steam-powered cargo pumps) or if 
the in-port power demands are not overly significant (e.g. a bulker 
with only hotel loads). In light of the unique demands of oceangoing 
vessels, more investment in research, development, and demonstration 
projects is needed to deliver cost-effective and commercially scalable 
zero emission solutions for these vessels.
                      Summary and Recommendations
    The marine industry is just beginning its march toward zero 
emissions with commercially ready cost effective solutions available 
today to meet the needs of multiple vessel segments. There are, 
however, some segments, like oceangoing vessels, that require 
significant additional technology research and development in order to 
reach a zero emission target. One commonality across all segments, 
which is also true across many new technologies, is that with scale and 
experience, costs trend downward. This has been the case with solar and 
wind power, and also electric vehicles. To same will hold true for 
marine vessels.
    There are a number of actions that the Federal Government and this 
Committee can take to increase deployment of existing zero emission 
technologies, invest in the zero emissions technologies of the future, 
and grow US leadership in the marine sector for decades to come.
    1.  Green the Federal Fleet. The US government is a globally 
leading shipowner, and as such it can become a pacesetter in deploying 
cost-effective, advanced technologies. In addition to Department of 
Defense ships, the US owned fleet includes Coast Guard, MARAD, and 
National Park Service vessels.
         ABB encourages the Committee to set an ambitious, long-term 
national plan to achieve zero emissions for all vessels under its 
operation. Doing so would have a meaningful impact directly on vessel 
emissions and establish the private US maritime industry as a global 
technology leader. This would also help the US do its part toward 
meeting the International Maritime Organization's (IMO) Sustainability 
Goals. ABB is prepared to support the Committee in developing such a 
strategy to seek realistic, cost-effective solutions.
    2.  Limit Tier 4 Engine waivers to where true hardships exist. 
After a thorough rulemaking process and cost justification, EPA 
requirements for reduced emission engines have arrived. Engine 
manufacturers have provided proven, cost-effective engine solutions to 
meet these requirements. While EPA is not under the jurisdiction of 
this Committee, waivers for vessels under this Committee's jurisdiction 
should be issued judiciously and only after thorough demonstration of 
hardship to meet the requirement.
    3.  Support financing mechanisms and direct funding for private 
sector, zero-emission vessels, projects, and equipment providers. Zero 
emission vessels often have higher up front capital costs, but lower 
operating costs and therefore lower total cost of ownership than 
conventional diesel systems. Government investment in research and 
development can help lower those costs. As such, we recommend 
supporting and expanding programs like the Maritime Education and 
Technical Assistance (META) Program. The Federal Transit 
Administration's Ferry Grant Program should be expanded and could 
include a focus on zero emission technologies, just like the Transit 
Bus ``No/Lo'' program. We also suggest exploring establishing a low-
interest loan program to cover the incremental capital cost of choosing 
a zero emissions technology.
    4.  USCG Marine Safety Center. The Coast Guard's Marine Safety 
Center (MSC) is faced with the challenge of ensuring the safety of 
vessels, regardless of propulsion technology. As lithium ion batteries, 
fuel cells, hydrogen, and other new technologies become commercially 
available, the MSC is tasked with updating the Code of Federal 
Regulations (CFR) to address these new technologies. This will require 
time and resources. ABB is prepared to support MSC in this role and 
asks the Committee to do the same.
    5.  Invest in Research and Development. While there are 
commercially available zero emission solutions available today for some 
marine segments, others still require significant research and 
development, particularly in the area of fuel-cells, advanced battery 
chemistries, and advanced net-zero fuels. Through the US Coast Guard's 
Research Development Test and Evaluation Program, the Department of 
Energy, and MARAD's META Program, the Committee could encourage 
development of a zero emissions ship research and development program.
    6.  Help solve shore charging. As vessels like ferries electrify, 
electric utilities are faced with high power loads during recharge. 
This can often trigger demand charges which can significantly challenge 
the otherwise favorable economics to move to electric. Solutions like 
shoreside energy storage systems are available to mitigate this cost, 
though they can add cost and complexity to the project. The Committee 
could also direct MARAD to invest in shoreside power through funding 
mechanisms like the Port Infrastructure Development Grants.
    7.  Training. Support Maritime Academies and ensure labs and 
curriculum include the latest technology. While alternating current 
(AC) electrical systems remains a common standard on vessels, ships 
powered by electric propulsion will be built using direct current (DC) 
architecture. Training curriculum should be updated to address these 
changes to how ships are powered.
                               References
Colton, T. (2019, January 6). Shipbuilding History. Retrieved from 
    http://www.shipbuildinghistory.com/statistics.htm

DNVGL. (2018). Energy Transition Outlook.

    Mr. Maloney. Thank you.
    Ms. Metcalf?
    Ms. Metcalf. Yes. Perfectly said.
    [Laughter.]
    Ms. Metcalf. Good morning, Chairman Maloney, Ranking Member 
Gibbs, and members of the subcommittee. Thank you very much for 
allowing us to testify here. And this is not my testimony, but 
I have to also be very proud, because I live in the western 
suburbs of Philadelphia. I Amtrak down here every day. So it is 
nice to see a friend of mine from Pennsylvania on the dais.
    I am Kathy Metcalf, president and CEO of the Chamber of 
Shipping of America, representing member companies who are 
U.S.-based that own, operate, or charter a number of different 
vessel types.
    When I was first contacted about this hearing, the 
indication was that it would be a green shipping hearing. And 
so, over the holidays, I dutifully did some testimony, and then 
I found out when I received the invitation that it was a little 
bit more narrow, it was more towards carbon free, or zero 
carbon.
    But then I thought further, and when I noticed my good 
friend, John Butler, and Lee Kindberg was going to sit and talk 
about the specifics of the IMO plan, you are smart guys and 
girls and you don't need to hear the same thing twice.
    So I thought it might be helpful, since I was sitting 
between you and lunch, to go up to about a 40,000-foot level 
and talk about green shipping and sustainable shipping, because 
the only environmental issue of importance to the maritime 
industry is not just greenhouse gases, it is a multiple of 
many, many issues. And most of them are linked together, kind 
of like a spider web. You pull on one, you might undo another 
one.
    So what I have tried to do is--I noticed that Mr. Thoreau 
once stated, ``it's not what you look at that matters, it's 
what you see.'' I realize that we all have different 
perceptions of what green shipping or sustainable shipping is. 
And, in the simplest of terms, green shipping is a focus on 
reducing the environmental profile of vessels. Sustainable 
shipping is a much larger, broader issue that involves society, 
human factors. And there is an excellent diagram in my 
testimony from the European Union on this.
    Global industry, 90 percent of our goods, are transported 
by water. It is also the most environmentally friendly mode of 
transportation. Now, why do I say that? Not because we 
shouldn't be doing anything, but because we need to be sure 
that the most environmentally friendly mode of transportation 
remains and keeps its share. We cannot afford transmodal shifts 
to less environmentally friendly forms of shipping.
    So the regulatory framework--a couple of my colleagues have 
already talked about this--it is critically important that 
ships engaged in international trade have a set of robust, 
enforceable regulations at the international level. We are 
never going to get rid of national and sometimes subnational 
regulations around the world. But to maximize the efficiency 
and the environmental benefit of regulation, that consistency 
needs to be maintained at the IMO level.
    I am not going to waste your time, as I mentioned, talking 
about the path to a carbon-free maritime industry; John and Lee 
and others have done that quite well. But I would say that 
exactly what they said we totally support; the need for R&D is 
critical.
    In my testimony I have included a few summaries of a number 
of environmental issues: air emissions, not just greenhouse 
gases, but the more conventional pollutants that the industry 
has been working on; discharges to the water, including ballast 
water--thank you for passing VIDA. It is really--after, I 
think, 12 years on my part, it was a welcome addition to see 
that we are going to finally get a set of consistent 
regulations that govern those discharges.
    Biofouling, hull husbandry, critical. A clean hull is a 
happy hull, is a more efficient hull, which means you have 
better fuel efficiency, less emissions per ton-mile.
    Marine plastics. This is going to be hot, the hot part is 
the single-use plastics. We are seeing it already, 
internationally. Two countries in particular have banned the 
use of single-use plastics.
    Ship recycling, another important one.
    And we talked about it before the hearing, protection of 
marine resources, and noise.
    What I would say in closing, Mr. Chairman and Members, a 
Chinese philosopher once said, ``A journey of a thousand miles 
begins with a single step.'' Nothing could be truer for the 
global maritime industry at this point in time. But we have to 
understand that it is a transitional period as we approach 
2050.
    Thank you, and I am happy to answer any questions.
    [Ms. Metcalf's prepared statement follows:]

                                 
  Prepared Statement of Kathy Metcalf, President and Chief Executive 
                Officer, Chamber of Shipping of America
    Good morning, Chairman Maloney, Ranking Member Gibbs and Members of 
the Subcommittee. We appreciate the opportunity to provide testimony at 
this hearing to discuss paths to a carbon-free maritime industry as 
well as the more general concepts of green and sustainable shipping.
    Mister Chairman, we respectfully request that our testimony be 
entered into the record for this hearing.
    I am Kathy Metcalf, President and CEO of the Chamber of Shipping of 
America (CSA). CSA represents member companies which are U.S. based 
that own, operate or charter both US and non-US flag oceangoing 
tankers, container ships, and other merchant vessels engaged in both 
the domestic and international trades. Through CSA's long time 
participation in various national and international organizations, 
including the International Maritime Organization (IMO), our members 
are actively supporting a number of initiatives which will advance the 
concepts of green shipping and sustainable shipping in the global 
maritime industry including those leading toward a carbon-free maritime 
industry.
              What is Green Shipping/Sustainable Shipping?
    Henry David Thoreau once stated ``It's not what you look at that 
matters, it's what you see.'' Taking into account this simple statement 
on perspective as it applies to defining green and/or sustainable 
shipping provides the reason that a detailed internet search results in 
a myriad of definitions for these terms. Some view green and 
sustainable shipping as interchangeable terms. CSA and others, view 
green shipping as a subset of sustainable shipping.
    In the simplest of terms, green shipping is a process by which the 
environmental footprint of the marine industry is reduced subject to 
the principle of continuous improvement. It is not about one specific 
environmental impact but rather all the environmental impacts 
associated with vessel and port operations. A good case in point is the 
current focus on greenhouse gases (GHGs). Many speak of green shipping 
within the context of climate change and the reductions of GHGs, but in 
fact green shipping is much broader than that and represents an 
overarching concept that relates to all types of environmental impacts 
including air emissions, discharges to the water, impacts on living 
marine resources to name a few.
    Sustainable shipping is an even broader and arguably more important 
concept defined most often as a holistic management concept for 
sustainable development incorporating environmental and social 
responsibility and includes the three co-equal pillars of environment, 
society and economy. Sustainable shipping incorporates these three in a 
continuous loop of design, construction, operation and recycling 
principles with supporting principles of regulation, socio-economic, 
market related and human factor issues. Reproduced below from the 
European Maritime Safety Agency website is an informative graphic 
describing the multiple interfaces which comprise sustainable shipping.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Because of the many different stakeholders which are involved in 
the process, one of the most critical factors in the advancement of 
sustainable shipping principles, is the need for constructive 
dialogues, partnerships and the development of synergies to fully take 
into account the wide range of perspectives of all parties including 
their concerns, needs and expectations. Although a daunting challenge, 
it is only with consideration of these many stakeholders and their 
perspectives that sustainable shipping can be successfully implemented 
to the benefit of all. Sustainable shipping is not a project with a 
clearly defined time line, but rather is a continuous voyage with goals 
changing over time in an ever evolving world.
       The Global Maritime Industry and Its Regulatory Framework
    Approximately 90% of world trade is transported by ships, including 
raw materials, energy, food, as well as manufactured goods and 
products. Global shipping is the main facilitator of international 
trade and is obviously of vital importance to the global economy. 
Global shipping is also the most environmentally friendly mode of 
transportation. As an example, according to the IMO GHG Study (2009), 
oceangoing vessels produce on average 5.6 grams of CO2 per ton-
kilometer compared to 80 for trucks and 435 for aircraft. Similar 
benefits of global shipping are also observed in the areas of safety 
(fatalities per million ton-miles) and fuel efficiency (ton-miles per 
gallon). The relevance of these facts is key to the conclusion that 
global shipping is critical to both economic and environmental 
sustainability when compared to other transportation modes. This also 
leads to a further conclusion that any regulatory changes to the 
current environmental regulations at both the international and 
national levels should not impair the critical role global shipping 
plays in the global economy and should not result in the transfer of 
cargo to other less environmentally friendly modes of transportation. 
This is not a justification for lack of action as regards green 
shipping initiatives, but rather is a call for acknowledgment of these 
sensitivities as future regulatory requirements are considered and 
adopted at all levels of governance and ensures any actions taken 
relative to shipping do not result in cross media transfers or cross 
modal transfers to less friendly modes of transportation.
    The regulatory framework which governs the global shipping industry 
is complex. The IMO creates new environmental requirements which are 
agreed to by IMO member states and then implemented at the national 
level. In some cases, national and sub-national requirements are 
imposed which are different than or more stringent than those adopted 
by the IMO. In these cases, vessels calling in a particular port are 
faced with a patchwork quilt of requirements making compliance a 
challenge at best. In our view, because shipping is global, so also 
should be the environmental regulations which apply to global shipping. 
Fuel sulfur requirements are a relevant case study. At one point in 
time, vessels trading to California were subject to CARB fuel sulfur 
requirements, the US Emission Control Area requirements and the IMO 
fuel sulfur requirements. Fortunately as time has passed, these three 
sets of requirements have moved closer together in content. 
Illustrative in this example is the fact that many IMO treaties contain 
provisions for national programs where more stringency is deemed 
necessary such being the case with the US request for an IMO approved 
emission control area for North America and the Caribbean. The point of 
this conversation is that global shipping, the marine environment and 
society benefit from a robust set of international requirements that 
apply to vessels regardless of the areas to which they trade. It is 
within this context that the concepts of green shipping and sustainable 
shipping should be discussed and agreed so that one set of requirements 
are applicable to all vessels regardless of flag or location.
              The Path to a Carbon-Free Maritime Industry
    The path to a carbon-free maritime industry is related to the 
reduction of GHG emissions from vessels. IMO has adopted its GHG 
reduction strategy with current discussions focusing on the 
identification of short, medium and long term measures which will allow 
the global shipping industry to gradually reduce or eliminate its CO2 
emissions. The IMO Strategy establishes ambitious targets including the 
phase-out of GHG emissions ``as soon as possible this century'' and 
reducing annual GHG emissions from international shipping by at least 
50% by 2050 compared to the 2008 baseline. This is quite likely the 
most important and impacting initiative ever applied to the global 
shipping industry and will require the development of new vessel design 
and propulsion technologies as well as zero carbon or carbon neutral 
fuels.
    So what is the path to a carbon-free, or at least carbon neutral, 
maritime industry? In our view, the most critical first step to making 
progress on this initiative is the development of a robust global 
research and development program, a program which is, in fact, being 
proposed by the global maritime industry at the next meeting of the IMO 
Marine Environment Protection Committee in the spring of 2020. Key 
elements of this proposal include the establishment of a new research 
and development organization to pave the way for the decarbonization of 
shipping, core funding from shipping companies across the world of 
about USD 5 billion over a 10 year period and the acceleration of the 
design and construction of commercially viable zero carbon-emission 
ships by the early 2030's. Reaching these reduction goals will require 
the deployment of new zero-carbon technologies and propulsion systems 
such as green hydrogen and ammonia, fuel cells, batteries and synthetic 
fuels produced from renewable energy sources. These fuels do not yet 
exist in a form or scale that can be applied to large commercial ships, 
especially those engaged in transoceanic voyages and which are 
currently dependent on fossil fuels. Some have questioned why the 
global maritime industry cannot conduct these R&D efforts in a private 
setting. It is important to understand that the global shipping 
industry is comprised of tens of thousands of companies located in over 
a hundred countries. Creation of this mandatory R&D contribution 
mechanism is critical to ensure a level playing field exists as well as 
ensuring that the necessary funding to support these initiatives is 
shared across the global industry, is maintained at sufficient levels 
and the results of the R&D efforts are shared across the global 
maritime industry.
    As indicated above, the creation of this global R&D initiative is 
only the first step in the long and likely never ending path to a 
carbon free maritime industry. The MEPC through its GHG working group 
is addressing a number of other issues the resolution of which are 
critical to a successful outcome. In broad terms, these issues include 
discussions around how and to what degree existing technical and 
operational programs can be improved, developing procedures for 
assessing the impacts of mandatory measures on IMO member states, and 
development of cooperative efforts with ports and other land-based 
stakeholders throughout the entire logistics chain.
    Specific short term measures being discussed include improvements 
to the existing energy efficiency requirements (Energy Efficiency 
Design Index (EEDI), Ship's Energy Efficiency Management Plan (SEEMP)), 
development of technical and operational energy efficiency measures for 
both new and existing ships, analysis of the use of speed optimization, 
consideration of methane emissions, development of national action 
plans, enhancement of technical cooperation and capacity building, 
encouragement of logistics chain wide collaborative efforts and others. 
Mid-term and long-term measures include further refinement of the short 
term measures noted above, the development, implementation and 
provision of zero-carbon or fossil-free fuels including land-based 
manufacturing and distribution systems, and the identification and 
development of new/innovative emission reduction mechanisms.
     Other (equally important) Environmental Issues Related to the 
         Advancement of Green and Sustainable Shipping Concepts
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    As some of my fellow witnesses have likely experienced, we are 
often asked to identify and discuss the top 5 or top 10 environmental 
issues facing our industry. As illustrated above, this is a near 
impossibility as at any given point in time, we are working on at least 
20 environmental issues, each with different priorities over time and 
at various stages of analysis. The illustration above provides an 
example of the number of issues with which we deal on an everyday 
basis. It is also important to appreciate that initiatives that address 
one of these issues, may result in positive or negative impacts of 
others. Short summaries of the key issues are found below.
Air Emissions
    There are two distinct sub-topics relative to air emissions. The 
first relates to the reduction of GHG emissions from vessels which is 
discussed above. The second relates to the reduction of traditional 
pollutants from vessels including SOx, NOx and particulate matter at 
both the international and US domestic levels. IMO and the US are 
addressing these issues by further tightening requirements for engine 
design, the imposition of fuel sulfur requirements within ECAs as well 
as the imposition of the recent global sulfur cap of 0.5% for vessels 
operating in areas outside of ECAs. Related to this issue is the topic 
of alternative control strategies which includes the installation and 
use of exhaust gas scrubbers in lieu of low sulfur fuel. IMO regulates 
this issue under Annex VI of the International Convention for the 
Prevention of Pollution from Ships (MARPOL).
Discharges to the Water
    Issues within this subject matter being addressed at both 
international and US domestic levels include ballast water discharges, 
bilgewater/oily water separator effluent, exhaust gas scrubber 
washwater discharge, graywater and anti-fouling coatings/leachate, 
sewage and garbage as well as discharges/releases associated with a 
marine casualty. At the international level, these issues are discussed 
under separate initiatives within the Marine Environment Protection 
Committee under the provisions of the 6 annexes of MARPOL and separate 
stand-alone conventions addressing ballast water management, anti-
fouling systems, and oil pollution preparedness, response and 
cooperation (conventional oils as well as hazardous and noxious 
substances).
    In the US, 27 discharges to the water, including those noted above, 
are currently covered by the Vessel General Permit issued by EPA and 
the Oil Pollution Act (marine spill prevention, readiness and 
response). As you are aware, in December 2018, the President signed the 
``Frank LoBiondo Coast Guard Authorization Act of 2018,'' which 
included the Vessel Incidental Discharge Act (VIDA). After literally 
decades of collaborative efforts among Members of Congress, the 
industry and environmental groups, the enactment of these provisions 
were welcomed by the industry and will provide for a clear and 
comprehensive set of regulations governing discharges incidental to the 
normal operation of vessels. We have been informed that EPA is close to 
finalizing its proposed regulations as mandated by VIDA and we expect 
them to publish a proposed rule in the January/February 2020 timeframe. 
These regulations are required to be finalized by December 2020 at 
which time the USCG will develop their companion regulations which are 
required to be finalized by December 2022. Most importantly to this 
discussion of sustainable shipping is the recognition that both the 
international requirements and the US domestic requirements are under 
continuous review and as technology and best practices develop over 
time, are subject to change with due regard to the need for continuous 
improvement.
Biofouling/Hull Husbandry
    Hull biofouling/husbandry is an issue critical to the improvement 
of vessel energy efficiency as well as the prevention of the transfer 
of aquatic nuisance species. As regards the energy efficiency aspect, 
accumulation of marine species on the hull and in niche areas, creates 
additional drag which reduces fuel efficiency and negatively impacts 
air emissions issues identified above. As regards aquatic nuisance 
species, studies suggest that, at least in some areas, hull fouling 
contributes to the transfers of aquatic nuisance species more than 
ballast water discharges. Given the cross media scope (air and water) 
of positive impacts associated with good hull husbandry practices, the 
global marine industry embraces best management practices so that these 
environmental benefits can be maximized. An issue directly related to 
biofouling is the proper selection and use of anti-foulant hull 
coatings. While there are a number of coating types, current 
discussions are focused on the leachate which naturally occurs from 
metal based components of the coating. Tributyltin was phased out a 
number of years ago with the adoption of the IMO Antifouling Convention 
and US regulations banning its use. The current discussion focuses on 
copper based coatings and what impact their use may have on the marine 
environment in large part due to initiatives within the European Union. 
The industry is in constant discussions with coating manufacturers to 
assess what new coatings are being development with due regard for the 
reduction of their environmental impacts.
Marine Plastics
    Currently the issue of marine plastics use and disposal is 
regulated under MARPOL Annex V (Garbage), national and, in some cases, 
subnational regulations. As is the case with all MARPOL annexes, Annex 
V is under continuous review by the Marine Environment Protection 
Committee (MEPC) and has recently been amended to update the criteria 
for determining whether cargo residues are harmful to the marine 
environment and a new Garbage Record Book format which includes a new 
garbage category for e-waste. MARPOL Annex V explicitly prohibits the 
discharge of plastics at sea and requires disposal to shore reception 
facilities. A new topic which has recently arisen is the subject of 
single-use plastics. It is expected that MEPC will take up this issue 
due to at least two national laws (India, Kuwait) that seek to ban the 
use and disposal of single-use plastics in their waters and ports. The 
imposition of this ban is in violation of these countries obligations 
under MARPOL Annex V which requires that adequate reception facilities 
be available in their ports. Further complicating this issue is the 
fact that vessels can only purchase ship stores from ship chandlers 
based on the inventory of those chandlers and few, if any, provide the 
ability to purchase multi-use plastics or acceptable alternatives to 
single-use plastics for use onboard vessels. While the industry 
supports waste minimization concepts, including the use of multi-use 
plastics, any prohibitions on the use of single-use plastics must 
necessarily take into account the availability of alternatives 
(including multi-use plastics), a discussion best left to resolution at 
the IMO MEPC.
    It should be noted that a substantial fraction of marine plastic 
debris in the ocean originates from land-based sources and rivers and 
are related to the mismanaged plastic waste generated from land-based 
sources along these rivers. The 10 top-ranked rivers transport 88-95% 
of the global load in the ocean (Export of Plastic Debris by Rivers 
into the Sea, Environ. Sci. Technol. 2017, October 11, 2017).
Ship Recycling
    International requirements for environmentally responsible ship 
recycling is a decades long discussion which resulted in the IMO Hong 
Kong International Convention for the Safe and Environmentally Sound 
Recycling of Ships (2009). The Convention was agreed in 2009 but has 
yet to enter into force due to low ratification rates by IMO member 
states. The Convention is aimed at ensuring that ships, when being 
recycled after reaching the end of their operational lives, do not pose 
any unnecessary risks to human health, safety and to the environment. 
The Convention intends to address all the issues around ship recycling, 
including the fact that ships sold for scrapping may contain 
environmentally hazardous substances such as asbestos, heavy metals, 
hydrocarbons, ozone-depleting substances and others. It also addresses 
concerns raised about the working and environmental conditions at many 
of the world's ship recycling locations. Ship recycling is also 
addressed in the European Union Ship Recycling Directive as well as 
under national laws. It is hoped that regional and national 
requirements for ship recycling will become aligned with the provisions 
of the Convention when it receives sufficient ratifications to enter 
into force.
Protection of Living Marine Resources including Noise from Commercial 
        Shipping
    The impacts of all ocean users, including shipping, is an active 
point of discussion in a number of organizations with current 
activities focused on determining the impacts of these activities on 
living marine resources. Two specific issues related to global shipping 
have received much attention at international and national levels. The 
first issue relates to ship strikes of large marine mammals and 
discussions are ongoing as to how governments and the industry can 
minimize the likelihood of vessels striking marine mammals. This issue 
is challenging when taking into account that large marine mammal 
populations are subject to annual migration patterns and the fact that 
most large marine mammals are not usually visible to the eye of the 
navigation officer that is controlling the movements of a vessel. IMO 
efforts thus far have resulted in the creation of guidelines for 
minimizing the risk of ship strikes with cetaceans (2009). US efforts 
thus far include programs focusing on the reduction of ship strikes of 
the North Atlantic Right Whale (East Coast of the US) and multiple 
whale species off the coast of California.
    The second issue relates to the underwater noise generated by the 
movement of vessels through the water. Over 85% of the underwater 
radiated noise from a given vessel is a result of propeller cavitation 
and much work is being done to identify solutions related to the design 
and construction of vessels as well possible operational changes which 
could reduce the underwater radiated noise. While IMO has produced 
guidelines on the reduction of underwater noise (2014), it is expected 
that at least one IMO member state will propose the addition of this 
issue to the MEPC work plan for future discussion and potentially the 
development of mandatory provisions.
                               Conclusion
    Global marine transportation is vital to the world's economy, 
moving a vast majority of goods and bulk materials to the world's 
population in the most environmentally responsible manner of all 
transportation modes. Notwithstanding, the importance of to the global 
economy, it is recognized that the environmental footprint of shipping 
should, and is being continuously reduced, by the initiatives described 
above. The global industry, through its work at IMO, supports these and 
future initiatives which will reflect our continuous improvement on 
environmental issues. CSA is also proud to continue to work with 
executive branch agencies in the US to address these issues at the 
national level.
    Ralph Waldo Emerson once said ``Life is a journey, not a 
destination''. A Chinese philosopher once said ``A journey of a 
thousand miles begins with a single step''. Nothing could be truer for 
the global maritime industry and its march toward sustainable shipping.
    Thank you for the opportunity to testify at this hearing. We would 
be happy to answer any questions.

    Mr. Maloney. Thank you, Ms. Metcalf. We will now proceed to 
the Members' questioning, following the 5-minute rule. I will 
begin by recognizing myself for 5 minutes.
    I have the great honor of representing the Hudson Valley of 
New York, which was named after Henry Hudson, of course, who 
sailed up the Hudson River in 1609, September 1609, and 
actually camped in a little spot--you can see it from my back 
yard--called Con Hook, about 40 miles up the river, September 
14th, 1609. And he, of course, began a process of using that 
river and so much of our water infrastructure to move goods and 
services, conduct discovery, and create the American economy. 
And this was all done by wind.
    And so what is interesting to me is the role that wind 
power may play in maritime shipping. It is not exactly a new 
idea, but can you comment on the role that wind-powered vessels 
may play in helping us achieve some of the goals we are 
discussing today?
    It is for any member of the panel.
    Mr. Bryn. Thank, Mr. Chairman. ABB does not, I don't 
believe, directly play in this space, currently. But there is--
there have been--I would point to two interesting technologies, 
one of which are sort of kites and sail technology. There are 
some challenges there that I am probably not in a position to 
speak to. But there are some technologies there.
    There has also been--for the first time we have seen 
commercial deployment of an idea called a Flettner rotor, kind 
of these tall columns that spin and kind of generate lift and 
actually help pull the ship along. So it is an interesting 
technology, and worth a look at, if you are not familiar with 
it.
    Mr. Butler. Mr. Chairman, just to add to that, my 
expectation is that, at the end of the day, we will see more 
contribution from wind power on land to create green processes 
for future fuels. In other words, if you are producing 
hydrogen, you need to do it in such a way that you are using 
carbon-free electricity, right?
    So my guess is, at the end of the day, while some of these 
technologies can--well, shipboard technologies can contribute 
to efficiency on the water, the biggest impact from wind is 
going to be in producing fuels on land that are then carried by 
vessels.
    Mr. Maloney. And building off of that, I am interested in 
your remark, Mr. Butler, but anyone feel free to answer, that 
there is a technological layer, or an incentive layer that is 
going to be required to move to zero emissions past the 2050/
50-percent reduction benchmark you mentioned. Could you 
elaborate on that?
    And what kind of incentives and assistance is the industry 
going to need to make that goal of zero emissions attainable in 
time to do us some good?
    Mr. Butler. So, I mean, the basic premise is no matter how 
efficient you make a diesel engine, you are still burning 
diesel, and you are still creating carbon dioxide as a 
combustion byproduct. So if we are going to get to zero 
emissions, we simply have to have a different propulsion 
mechanism using a different fuel, different technologies, and 
having a different emissions profile.
    So the single most important thing that we can do right now 
is to create and develop for commercial application those new 
technologies. We don't know what they are right now, there are 
candidates. We have talked about hydrogen. People have talked 
about ammonia, and using hydrogen either as direct burn or in 
fuel cells. But there are tremendous engineering questions with 
respect to the production of those fuels, the handling of those 
fuels, and the safe use of those fuels on board.
    So, you know, there are lots of discussions going on in 
various places about how you push people to adopt new 
technologies, carbon pricing, and this sort of thing, more 
regulations. The fact of the matter is, unless that pathway 
exists, you can flog people all day long, but if they have no 
place to go, the change won't happen. And that is why we are so 
focused on the research and development piece.
    Mr. Maloney. And let's talk about the shoreside 
infrastructure. What could we do in that regard to make the 
decarbonization of that, of the import process, come about more 
quickly?
    Mr. Butler. Well, there is the--you know, you have to do 
things in the proper order. Before you start talking about 
investing in shoreside infrastructure, you need to know what 
fuels and propulsion systems you are trying to support on the 
ships. Right?
    So it is all of a piece, but I think you would risk 
stranding a lot of investment, or making the wrong investments 
if you jumped too quickly into picking a particular shoreside 
infrastructure before you know what the end goal is. So I think 
a lot of what can be productively done by Government is to 
assist in figuring out what the right order is, and supporting 
it, each phase of that process, you know, the thing that has to 
happen next, before you can get to the next phase.
    Mr. Maloney. Ms. Metcalf, and my time is expired, I will 
yield to Mr. Gibbs, but if you want to say a word on that----
    Ms. Metcalf. I just wanted to add one thing, Mr. Chairman. 
Thank you.
    There is no doubt that ports and shipping are going to have 
to work together, and we need to start now, and we actually 
have started talking. John put it well, saying that the order 
of things is the most important.
    But the one thing--and I will cite the American Bureau of 
Shipping classification society and DNV GL classification 
society have done a number of studies. The DNV GL, 
particularly, I would recommend. It is called the Energy 
Outlook 2050, and there is a great chapter in there on 
transitional fuels.
    So the key--and my point in intervening here--is we don't 
go from traditional marine fuels now to zero fuels. There are 
transitional fuels--fuels such as LNG is a good example--that 
we need to be able to build the infrastructure ashore, so that 
the new LNG-fueled ships are able to use that fuel, instead of 
having to go back to conventional. Thank you.
    Mr. Gibbs. Thank you. Again, I think you make a good point 
about the transition fuels.
    I want to ask Dr. Kindberg. I have seen those big 
containerships. What is the average age in your fleet? When you 
put a ship on, how long do you expect it to be in service?
    Ms. Kindberg. The life expectancy of those ships is 20 to 
25 years, but the average age of our fleet is somewhere around 
the 7-year mark.
    Mr. Gibbs. OK. So the transition is a huge deal.
    Ms. Kindberg. Oh, yes. It is a big deal.
    Mr. Gibbs. Are you looking at--are any of your ships fueled 
with LNG or not?
    Ms. Kindberg. We do not currently have any ships that are 
fueled with LNG. A couple of our competitors have one or two. 
But it is definitely a bridge fuel that there does need to be 
infrastructure for. Just like for biofuels, there will need to 
be infrastructure.
    And we think biofuels will be perhaps another bridge fuel, 
but perhaps a long-term fuel, because with biofuels you take 
the carbon dioxide out of the atmosphere to grow the plants. 
Then you make that into fuel and you burn it immediately. So 
there is no new carbon dioxide. Whereas, if you take it out of 
the ground as a petrochemical, you are actually adding new 
carbon dioxide to the atmosphere. So there is a difference, and 
biofuels will absolutely be part of this blend. But we have to 
do that intelligently, too----
    Mr. Gibbs. LNG also, I believe, when it comes to 
particulate matter, is zero emissions on oxide, sulfur oxide 
and nitrous oxide. It is close to a 100-percent reduction in 
emissions, and probably is, what, 40-percent reduction in 
greenhouse gases?
    Ms. Kindberg. I don't know that number off the top of my 
head.
    Mr. Gibbs. Mr. Berger, I understand that the Governor of 
Washington has come out in opposition to building a new LNG 
fueling facility in Tacoma. When we talk about transition, is 
the Governor of Washington State more inclined to just wait 
until new technology comes, maybe two, three, four decades 
away, and not look at a transition fuel like LNG?
    Mr. Berger. Thank you, Ranking Member. So I understand that 
many in this sector investing in LNG and infrastructure to meet 
immediate timelines, particularly in the IMO and--in Washington 
State, Governor Inslee wants to focus on zero-emission 
solutions.
    My role is to be a liaison and facilitator. Washington 
Maritime Blue is a member-based organization that is set up to 
support each of its member goals. The commitment it makes is to 
be a convener around some of those difficult questions in a 
thoughtful dialogue.
    Another example like that is automation. These are tough 
questions that we need to have as we make major transitions 
across the industry. And as a cluster, if we are able to bring 
together all those multiple stakeholders to work on a common 
vision and how we get to sustainability, how we get to zero 
emission, we need to figure out ways to address those difficult 
questions. And as a cluster organization we are able to 
facilitate that.
    As long as we are making decisions that are based on 
science, and seek to balance those three prongs that we are 
helping to grow our maritime sector, we are making healthy 
decisions for our ocean and marine ecosystems, and----
    Mr. Gibbs. And also looking----
    Mr. Berger [continuing]. Communities.
    Mr. Gibbs. [continuing]. At those decisions. Have you 
factored in the economics? Because we don't want to put our 
companies, our shippers in a very disadvantaged competitive 
position, compared to the competitors elsewhere. Is that a 
factor?
    Mr. Berger. Yes. Keeping a viable, economically viable and 
forward-thinking innovation sector is absolutely a factor.
    Mr. Gibbs. Mr. Bryn at ABB, the technology for batteries--
in your testimony--from the last several years has just 
exponentially improved. When you talk about your ships that are 
ferrying across the waterways, recharging them in 7 minutes, 
and I know you got the--working out there in Washington State--
I believe it is Washington State--with a huge megawatt--
recharging in, like, 15 minutes. We are talking about 15 
megawatts, right?
    Mr. Bryn. Correct, yes.
    Mr. Gibbs. Have you guys done any research or studies? You 
know, obviously, that would be a zero-emission vehicle, vessel, 
OK? But are we just moving one emission from here to there? 
Because the generation to generate that kind of megawatts--has 
anybody looked at that situation, so we are just not moving 
emissions from here to there, and not really addressing a net 
reduction?
    Mr. Bryn. Yes, absolutely. I appreciate the question, and 
it is a very good one. It comes up often.
    One thing I would like to point to--I am looking through 
our written testimony here--figure 7 shows an example of a 
study that we have done for a typical ferry, and it shows the 
estimated CO2 impact of different design decisions.
    So you are absolutely right, and I sort of look at this as 
sort of a two-phase process. The first is does it help with 
emissions today, and does it help with emissions long term?
    And what I mean by that is if we are, for example, going 
for an electric ferry, the immediate impact will be whatever 
the CO2 and other emissions of the grid are. How does that 
compare to a diesel engine? And what we find is, even in the 
most conservative case, where you are getting all of your 
power, for example, from coal, the electric vessel does tend to 
be lower carbon and lower on a lot of other pollutants than the 
diesel equivalent. And it is because the coal plant can do a 
lot of waste heat recovery and after-treatment, things like 
that.
    So, in the short term, the answer is almost always yes. And 
that is, like I said, the most conservative case. If you are 
getting your power from hydropower or gas or something, it 
would be improved.
    In the long term I think we also have to recognize that the 
grid continues to clean itself up. And so we would like to get 
this technology deployed in parallel, so that, as the grid 
cleans itself up, we also have an----
    Mr. Gibbs. I am out of time. Just one quick comment.
    Mr. Bryn. Sure.
    Mr. Gibbs. The infrastructure of the grid and our base 
generation capacity to do what you are talking about, because 
you are talking about recharging a vessel, one vessel, 15 
megawatts. I mean I can just see the powerplant going--you 
know, melt down. But the challenge is there.
    Mr. Bryn. Thank you. Yes, it is a challenge. We are working 
with utility partners to make sure that is feasible.
    I should be clear. For the Washington State Ferries project 
we are not currently selected for that. We are hopeful to be, 
but that has still not been decided yet. So I just wanted to be 
clear, we are not a partner on that yet. Hopefully.
    Mr. Maloney. I thank the gentleman. Mr. Larsen?
    Mr. Larsen. Thank you.
    First off, I want to thank the ranking member for his 
concern about issues in my State. I appreciate that.
    Second, Mr. Berger, on the electric ferries, can you--first 
off, thanks for being out here and testifying. What is the cost 
of the transition to electric ferries? This is a retrofit and 
not a new build, is that correct?
    Mr. Berger. Thank you, Congressman. So we actually have 
both going on at the same time. We are both retrofitting what 
we call our Jumbo Mark IIs, starting with the first vessel, 
which will be coming out of the water soon--that is now under 
contract--as well as a new-build construction. The State 
legislature has paid for the first, a series of five new-build 
constructions. So it is a retrofit to a hybrid electric, as 
well as new builds.
    The new-build vessels, we are looking at about $15 to $20 
million more, upfront costs, which would also be inclusive of 
the shoreside charging mechanisms that need to be. It is very 
similar, almost same design as the previous Olympic-class 
vessels, but with new propulsion systems.
    Mr. Larsen. And then the anticipated life-cycle costs 
relative to a new-build diesel?
    Mr. Berger. Well, when we were looking at the battery 
technology, we are slating for--Mr. Bryn might be able to 
answer this, because he is putting the bid together for it, but 
I think----
    Mr. Larsen. I won't ask him that----
    Mr. Berger [continuing]. The batteries were about 5 to 8 
years. We are bringing that cost comparison right now.
    Mr. Larsen. Oh, you are? OK.
    Mr. Berger. As we look at some of those key challenges when 
we are talking about particularly kind of this both/and 
approach, and making sure that we are paying attention to the 
entire system, yes, we need to be looking at that grid at the 
same time.
    We are very fortunate Washington State makes this a great 
place to start building and proliferating this kind of 
technology, because we have some of the cleanest and cheapest 
power in the United States. And so it is a great place for us 
to build on these vessels, to make the ROI come back right in 
less than 10 years, if not sooner.
    But the attention and the investments that need to be made 
to kind of build smart grids and have the grid capacity to 
support charging up to 10 megawatts of these vessels is also 
critical, as well as we look at other technologies, like energy 
storage onshore in order to kind of take care of the peak 
shaving on the grid. All that is under consideration, and we 
need to invest in it.
    Mr. Larsen. So in the--in testimony from--a few of you have 
talked about the relative ease of passenger vessel 
implementation here, because you have set schedules and so on. 
The State, our State, has a larger system, but they are a 
smaller, county-based system. Specifically Skagit County, as 
you know, the Guemes Island Ferry. They just need one ferry to 
replace. And they are trying to move forward on getting an 
electric ferry for that.
    Is that something the State does support, or do you have 
ideas about how these smaller systems can fit into a larger 
maritime blue strategy?
    Mr. Berger. You are exactly right, Congressman. You know, 
so smaller ferries, both in our county system as well as when 
we are taking into account the growth of a high-speed passenger 
ferry fleet--as population growth across western Washington is 
so astronomical, there is more and more look at bringing that 
mosquito fleet back--there are lots of mechanisms in place 
within the State, and we are looking for others, as well.
    We have our clean energy fund, we also have the opportunity 
to bring in some private investment, right. As we start talking 
about those opportunities for operational savings, it starts to 
make sense to bring some private investment into some of those 
projects.
    Of course, each of those ferries look for both that kind of 
hybrid stack of capital, they are looking at opportunities for 
various different Federal funds, State funds, and private 
dollars. All that is necessary. What we are fortunate to do is 
now have a mechanism in place to help support those type of 
projects, go out and seek, and then receive those various 
different types of funding into a particular project. And the 
cluster organization is there to help support that.
    Mr. Larsen. Thanks.
    Dr. Kindberg, our U.S. Navy has a lot of ships, but there 
are a few ships that are hybrid. And the idea is that, when 
they are underway, they can switch to an electric drive, so--
because they are just going in a straight line, they don't 
really need to be doing anything much else. But when they are 
getting in--out of port and into port, they need to have a 
little more maneuverability, a little more control, and so on.
    So I am wondering if, looking at the larger oceangoing 
vessels, if that is an option, or are we looking at one 
propulsion system, one kind of propulsion system, or a hybrid 
system for the 2030 or even the 2050 timeframe.
    Ms. Kindberg. No, I am not really familiar with what the 
U.S. Navy might define as a hybrid.
    Mr. Larsen. Sure. All right. Well, answer my question, 
then. What are you looking at?
    Ms. Kindberg. What are we looking at? We are certainly 
looking at batteries, we are looking at new fuels. But we have 
also added waste heat recovery. We have changed out propellers 
to be much more energy efficient. We have changed out bulbous 
bows. We actually give the vessels a nose job. You cut off that 
bulbous bow and weld on a new one, so that it is more energy 
efficient at today's speeds. And then, of course, you have all 
heard of slow steaming. And then we have got new, larger, more 
energy-efficient vessels per container.
    So those are all different approaches that we have taken to 
try to push this forward and achieve that 42-percent reduction 
that we have achieved so far.
    Now we are going into new technologies, what we call the 
connected vessel strategy, so that Big Brother actually is 
watching all of those ships, and monitoring all of the 
different engineering sensors, and making sure that we are 
squeezing that last bit of energy out of what is on the vessel.
    Mr. Larsen. Thank you.
    Thank you, Mr. Chairman.
    Mr. Maloney. I thank the gentleman. Mr. Weber?
    Mr. Weber. Thank you, Mr. Chairman. I hope we get a second 
round. I have got three pages of questions.
    Mr. Butler, you talked in your comments about a 2030 goal, 
a 2050 goal, and going forward. And has there been any thought 
to nuclear, and just powering these ships that would be 
nuclear?
    Mr. Butler. Well, that has been a debate, sir, that has 
been going on for years. My personal take on that is that the 
politics of that are going to prevent it from ever being a 
widespread solution for----
    Mr. Weber. It hasn't prevented it thus far, has it?
    Mr. Butler. Well, for the commercial fleet----
    Mr. Weber. That is a joke, Mr. Butler; of course it has. 
Thank you.
    Well, let me move on. So the focus is away from fossil 
fuels, although I am hearing Dr. Kindberg talk about--was it 
cooking oil as a substitute? What were you calling that?
    Ms. Kindberg. That fuel is actually pretty limited in 
availability, because it is actually made from used cooking oil 
that is collected in Europe.
    Mr. Weber. Right. Well, you want to talk about needing 
infrastructure, OMG, you really need infrastructure there to 
collect all that.
    Are we really talking about just completely doing away 
with--is Maersk thinking they're just completely doing away 
with combustion engines?
    Ms. Kindberg. One of the early moves that we will make will 
be biofuels, and that is why I mentioned it, again, earlier. 
Because, again, biofuels are considered renewable, and that 
carbon, when you do the carbon accounting, doesn't count, 
because it is taken out of the atmosphere and returned quickly 
back to the atmosphere.
    Mr. Weber. OK. If you do biofuels, again, you are still 
back to an infrastructure need. Correct?
    Ms. Kindberg. Yes, sir.
    Mr. Weber. How do biofuels compare, for example, to--I will 
use LNG. We will move off of diesel. Hopefully that is our 
goal, here. How do biofuels compare to an LNG-powered vessel?
    Ms. Kindberg. Biofuels is a broad category. There could be 
bio-LNGs that could be derived from biological sources, but 
would still need the infrastructure to be delivered to the 
vessel.
    Mr. Weber. Well, if you are talking about liquified natural 
gas, now you are talking about storage where you have got tanks 
that are really, really cold, cryogenic storage. Now you are 
talking about some really, really major--you know, I have five 
ports in my district in the gulf coast of Texas. We do a lot of 
energy. We export a lot of LNG, and so this is extremely 
important that we are talking about it.
    And I think you also said that an 80,000-horsepower engine 
was most efficient. Can you--I am just trying to read my notes 
here, I was scribbling quickly. What did you say about 80,000-
horsepower engines?
    Ms. Kindberg. That was an example--our engines, unlike some 
of the military ships, our vessels operate with one great, big 
diesel engine.
    Mr. Weber. OK.
    Ms. Kindberg. And one big propeller. Some of the biggest 
ships today do actually have two engines and two propellers. 
But it is--we don't have some of the flexibilities or the costs 
that the military has.
    Mr. Weber. Right. Well, you know that submarines were dual-
powered, where they ran on batteries under water, of course, 
and they would surface and recharge with diesel engines, their 
batteries. Have you looked at kind of the dual set-up like 
that?
    Not necessarily diesel; it could be LNG or biofuels, or 
whatever, and then batteries. Yes, ma'am?
    Ms. Kindberg. Continue? Yes, thank you. We are looking at 
batteries. As a matter of fact, we have got a battery being 
shipped to a vessel right now for on-board testing. But there 
are also concerns about risk assessments, in terms of large 
batteries.
    Mr. Weber. How does the size of that battery compare to, 
say, a fuel tank, in terms of--you are going to use up cargo 
space, right, if you have too big of a fuel tank, or too big of 
a battery. How does a battery size compare to a fuel tank, do 
you know?
    Ms. Kindberg. Well, the battery we are going to be testing 
is the size of a 40-foot container. So it is 40x8x9 feet. But 
it is not going to be capable of moving the vessel. It is going 
to be used for peak shaving
    Mr. Weber. It is going to be used for what?
    Ms. Kindberg. Taking off the peak when we need to generate 
more power than the main engine is normally generating. So we 
might have to start up an auxiliary generator.
    Mr. Weber. OK.
    Ms. Kindberg. We would use the battery instead.
    Mr. Weber. You mean for, like, living quarters, or 
operation of the ship?
    Ms. Kindberg. A lot of our energy is used for pumps and 
valves, but it is also used for refrigerated containers, 
because there is a tremendous amount----
    Mr. Weber. Oh, sure.
    Ms. Kindberg [continuing]. Of refrigerated goods moved.
    Mr. Weber. So that is interesting, because you could take a 
couple of 40-foot 8x8 containers and have a pretty good energy 
supply there.
    And you are going to see if the battery lasts, is that what 
your--because you know what the footprint is. Are you looking 
for how powerful it is? What are you looking at?
    Ms. Kindberg. Well, again, the battery that we are going to 
be testing is not even capable of operating a vessel at--
alongside at shore for multiple days.
    Mr. Weber. Yes, but how about it----
    Ms. Kindberg. It is a first step.
    Mr. Weber. How about the refrigerated units? How about 
vessel lights and comfort? Will it do that?
    I am not talking about powering the ship, but I am just 
talking about running the living quarters, for example.
    Ms. Kindberg. It could run part of them.
    Mr. Weber. OK. Lots of questions. Thank you, Mr. Chairman.
    Mr. Maloney. All right, thank you, Mr. Weber. Now to the 
newest member of the subcommittee, who enjoys his own fan club 
among the witnesses, the gentleman from Pennsylvania, Mr. Lamb.
    Mr. Lamb. Thank you, Mr. Chairman.
    Welcome, everyone. Thank you for coming. I would like to 
shift the discussion a little bit towards vessels on our inland 
waterways.
    Western Pennsylvania, where I live and represent, has one 
of the largest inland ports in our country in Pittsburgh, with 
a lot of boats, mostly tugs and barges, on our three rivers. 
And we were the beneficiaries of a very interesting Government 
initiative a couple of years ago in which the U.S. Maritime 
Administration made a $730,000 grant to the Pittsburgh Region 
Clean Cities, which covered about half the cost of retrofitting 
a single towboat to go from diesel to natural gas/diesel 
combination.
    So it was about a $1.4 million project, single boat, dual 
fuel system. It decreased diesel by about 60 percent, overall. 
And they have been monitoring ever since how it has been 
working, but this is a boat that I think was built back in the 
1940s, so it is a pretty old vessel that they were retrofitting 
to do more work with.
    So I think it sounds like a great idea. I am happy we did 
it to demonstrate that it could work. And I guess my question 
to the group is, hearing that, is that a good use of Government 
investment dollars at that price, to be retrofitting these old 
vessels? What are some other options in that category, 
particularly as it relates to LNG?
    Because I share some of my colleagues on the other side's 
interest in using LNG more, especially what we produce in 
western Pennsylvania. And I do think it could be what Ms. 
Metcalf called a transition fuel here. But obviously, it is all 
about price, retrofitting versus designing new engines that 
would require LNG, as well.
    So I know that is kind of a lot in there, but any thoughts 
folks have on that?
    It looked like Mr. Bryn and Ms. Metcalf both, so maybe we 
could start on the end with the sole member of my fan club 
there, and then move over. So----
    Ms. Metcalf. I promise we will promote it, we will get you 
some more members.
    My opinion? And we do have some tug barge members. The 
American Waterways Operators has a primary inland coverage.
    Generally, what we find in large and small vessels, if you 
are going to incorporate new technology, it is cheaper to do it 
at new construction. Retrofitting--I think it is great they did 
this project, but retrofitting a 40-year-old vessel just 
doesn't make a whole lot of financial sense to me, other than 
to see if it can be done.
    Now, keep in mind, also, vessels on the Great Lakes are not 
at that 20- to 25-year lifespan. They are--there are some of 
them up there 50, 70 years old, I believe. OK, well, I am old, 
too, but I don't want to get too old. So it is a different 
marketplace up there, as well.
    The other thing about alternative fuels on the Great Lakes, 
or electricity, is that you have got shorter runs. You don't 
have 5,000 miles of Pacific Ocean that you are having to 
transit. You have got stops in between that you may be able to 
integrate a shore-based infrastructure of fuels and/or 
electricity that would be alternatives.
    Mr. Lamb. Thank you.
    Mr. Bryn?
    Mr. Bryn. Thank you for the question, Congressman. Yes, 
this is a topic that is sort of near and dear to our hearts. We 
have been working with the inland industry, and the inland 
towboats--it is a very interesting industry, and towboats come 
in all flavors and sizes.
    For example, there are what we call unit towboats that 
might run from a refinery in Congressman Weber's district and 
drop off some barges up in your area. It is a very, very 
interesting system. We have unit towboats, there are linehaul 
towboats, which push 40, 50 barges at a time on kind of a 
regular liner service. There are shuttle boats that run up, 
across the river.
    My point is that, depending on the vessel's profile and 
need and its service, the best solution can vary quite a bit. 
And so, what we have found with a lot of boats is what is 
common--if you take linehaul boats out of it and look at the 
rest of the types of boats, a lot of them do a lot of time 
actually sitting around. If it is a shuttle boat, they will be 
sitting alongside a barge for hours, days on end sometimes. 
When you get up into the locking river, where you all are, it 
would be spending a lot of time going through the locks.
    And anyway, at that low power, oftentimes these engines 
need to still idle, because the crew still needs instant power 
if, you know, in the event of an emergency or something.
    And so, what we found is a diesel-electric arrangement, 
while not zero emissions, can reduce engine running hours quite 
a bit. And then, if you add a battery, you can also just shut 
the engines off altogether, run off battery for a few hours. It 
can save quite a bit of fuel, and it is--you know, it is just a 
nicer environment for the folks on board, as well.
    So there are solutions. The key is fitting the right 
solution to the vessel. And that can work with LNG or diesel 
fuel.
    Mr. Lamb. Yes. I guess what I am asking is, you know, 
within the Government we always--oh, and I am basically out of 
time, so I will save that thought for next time and yield back 
to the chairman. Thank you.
    Mr. Maloney. I appreciate that. I thank the gentleman.
    Mr. Lowenthal?
    Mr. Lowenthal. Thank you, Mr. Chair, and thank you all, 
members of the panel.
    As you know, I represent one of the largest port complexes 
in North--well, the largest in North America in Long Beach/L.A. 
So I am interested in something that we started a number of 
years ago, or California started, and that is--I am going to 
first ask Mr. Bryn--and that goes to your--in your 
recommendations about solving the shore charging, and talking 
about shore charging. I think that the rollout of shore 
charging and shoreside power systems is vital to be moving in 
this direction.
    For example, in my community, as I mentioned, the L.A./Long 
Beach, we have driven substantial reductions in localized 
diesel emissions. And we are an area that is out of compliance, 
so this was critically important, not only to move the 
industry, but to protect our communities, which are--which--we 
have this tremendous movement of goods in an area that is very 
densely populated and ecologically tends to capture this 
pollution and let it sit, unless we really try to prevent it.
    So we have driven substantial reductions in localized 
diesel emissions through investment in dockside power in a 
State mandate for commercial vessels to use shore power. But we 
know that the adoption of this technology has been lagging 
across the country. And an EPA analysis in 2017, that found 
that, outside of California, only a handful of ports have any 
shore power capacity.
    And you talked about also--Mr. Bryn--about possible grants. 
And I know--if Congress made additional Federal grants or loan 
funds available to install shore power infrastructure, do you 
believe there is an interest at ports and terminals to adopt 
this technology without a mandate?
    And I want each--you know, we can start with Mr. Bryn, and 
then we are going to ask Dr. Kindberg.
    Mr. Bryn. Yes, thank you, Congressman. The Clean Air Action 
Plan in California was certainly a model, and it was forward-
thinking, for sure. And it has led to a lot of the development.
    We should be clear about shore charging. First of all, 
there are a few flavors. One is to plug in vessels like 
Maersk's when they arrive at the terminal to power the on-board 
load while they are at port. The other flavor is to charge up, 
like, a battery bank on a ferry or a tug in between voyages. 
Both have their own challenges.
    I would say, on the side which I think you are more 
referring to, which is charging oceangoing vessels, there are 
opportunities there. One of the challenges--well, I guess I 
would say two challenges, generally. One is that many vessels, 
especially older vessels, are not outfitted with the equipment. 
So, you know, that needs to be an upgrade done on board.
    The second challenges is that not all vessels are, let's 
say, obviously suited to it. So, for example, a containership 
or--a cruise ship is a perfect example. A cruise ship has an 
electrified power system. A containership, most of the loads 
that are happening on board are electric in nature, whether it 
is running the reefer boxes or the onboard loads, pumps, things 
like that. A bulker, though, doesn't have a lot of load when it 
is in port. A crude oil tanker runs a steam pump to offload its 
cargo.
    So my point, again, just like before, is it depends. And 
so, finding the right solution for the right vessel can be a 
challenge. And that may be----
    Mr. Lowenthal. But you could duplicate this not everywhere, 
but certainly in certain ports. It could be more widespread.
    Mr. Bryn. It certainly could be, but we would have to, as 
an industry, look at making sure--there is standardization 
already, making sure that is there, and making sure, you know, 
that all new vessels are outfitted----
    Mr. Lowenthal. Well, then I want to go to Dr. Kindberg, and 
asking is the industry ready to convert to shore power.
    In your testimony you did mention that Maersk uses cold 
ironing in California. Could your fleet use shore power if the 
infrastructure is put in place across the country?
    Ms. Kindberg. We are actually connecting today in China.
    Mr. Lowenthal. Pardon?
    Ms. Kindberg. China has been adding infrastructure very 
rapidly. As you know, they have very serious----
    Mr. Lowenthal. Onshore power, too. So the United States----
    Ms. Kindberg. So the vessels calling in California are also 
now connecting in China.
    Mr. Lowenthal. What about other ports in the United States? 
Would you be able----
    Ms. Kindberg. The barrier, I think----
    Mr. Lowenthal [continuing]. To connect to shore power?
    Ms. Kindberg. We don't have many vessels calling the east 
coast that actually have full shore power capability. Only 
about 5 to 8 percent of the global container fleet is currently 
fully equipped for shore power. It is about $1 million per 
vessel to equip it for shore power, and then per berth you 
could be talking anywhere from $1 to $5 million, plus the 
infrastructure to bring the power to the port.
    And, as you know, California bit the bullet and has made 
those big investments.
    Mr. Lowenthal. Right, California----
    Ms. Kindberg. But other places----
    Mr. Lowenthal [continuing]. Wants to protect its residents 
and the community. And so it made those investments.
    Ms. Kindberg. Right, but other places have looked at that 
and then decided perhaps they could get their reductions in 
other ways that were more cost effective. But, of course, 
California had already been through clean trucks and those 
things.
    Mr. Lowenthal. Do you think it is good to be moving towards 
more shore power throughout the----
    Ms. Kindberg. I think it is, but I think we have to find 
ways to do it more flexibly.
    Mr. Lowenthal. Thank you.
    Mr. Chair, I yield back.
    Mr. Maloney. I thank the gentleman. We are going to proceed 
to a second round of questions, with the witnesses' indulgence.
    Before we do that, just a point of personal privilege. I 
wanted to thank the person sitting next to me, whose name is 
Rennie Meyers, who has been here with the committee on a 1-year 
fellowship, NOAA's Sea Grant Fellowship, and has done great 
work for the committee.
    She is sitting in this chair today, normally occupied by 
the gentleman behind her, in recognition of her great work for 
the committee and her extraordinary skill in many areas, but 
especially in the areas of environmental concern. She will be 
going to another important position, where she will continue to 
support the committee. So we thank Rennie for her work.
    Proceeding to the second round, Doctor, if we could just 
finish up on some of the questions that my colleague from 
California was asking you, I am interested in the investments 
the Chinese are making that you alluded to. And, if you could, 
describe why that would be important to the Chinese Communist 
Party to make those investments.
    Ms. Kindberg. China has a very serious air quality problem. 
And so they have been looking at best practices around the 
world, and imitating some of those.
    So, as we begin to fuel switch here--and you were there 
when we first started doing that--they made that voluntary and 
then mandatory to use cleaner fuel in ports. And that is a very 
good way to reduce the sulfur that, as you mentioned, Mr. 
Chairman, does have health effects.
    They also are having the vessels connect to shore power, 
and then you turn off the engines, so there is no engine 
exhaust. And that way it reduces the air emissions, the toxic 
air emissions that are created while you are alongside.
    Mr. Maloney. And what kind of investments are we talking 
about by the Chinese Government in that regard?
    Ms. Kindberg. I don't know what the total is, but I know 
that there are about 12 or 14 ports that have very quickly 
installed shore power capability on lots of berths.
    Mr. Maloney. Is that going to merely serve an environmental 
purpose in China? Or will there be international economic 
opportunities for that technology, that type of equipment, in 
shoreside infrastructure that the Chinese can then export?
    Ms. Kindberg. I believe a lot of us are actually using 
Italian-made--although they may be produced in China, but in 
terms of the plugs and so forth----
    Mr. Maloney. And in terms of the U.S. industry in that 
regard?
    Ms. Kindberg. I am not aware of any U.S. industry that is 
doing that.
    Mr. Maloney. Right. And in other words, I am interested in 
the types of investments, in response to Mr. Weber's 
questioning about batteries, and the critical role they can 
play, and the size and the safety issues, what role could 
robust Federal investments in battery technology play in 
assisting you in that effort?
    How much of that currently is being borne by the private 
sector?
    In other words, that is a generic technology, to Mr. Bryn's 
point about making the technology fit the mission or the 
vessel. But there are some basic, core technologies involving 
an enormous need for research and development.
    Help us understand what role the Federal Government could 
play in assisting private industry and moving that to market in 
a cost-effective way.
    Ms. Kindberg. There are tremendous opportunities, but 
tremendous challenges, in terms of coming up with energy 
storage. And it is not just the maritime industry, it is our 
entire economy. That is a game-changer, if we could come up 
with cost-effective ways to store energy, and not just have to 
take it as it is made.
    So battery technologies would be a game-changer, not just 
for the maritime industry, but I think our whole economy.
    Mr. Maloney. But from your perspective, is the private 
sector going to be able to get there on its own, or do we have 
a role to play?
    Ms. Kindberg. I think I would have to turn to those who 
know----
    Mr. Maloney. Sure.
    Ms. Kindberg [continuing]. Better than I do.
    Mr. Bryn. Thank you, Mr. Chairman. So, looking at battery--
looking at marine battery technology, specifically, if you look 
at the cost structure for some of our marine battery 
manufacturers, when I talk with them, they say that the cost of 
the cells--which is the fundamental building block of the 
battery banks--it is on the order of about 20 to 30 percent of 
the overall cost. And the remaining 70 percent is specific to a 
marine-built battery with--and, obviously, safety is always 
paramount, and we have a very high standard in the maritime 
industry.
    So that is to say that--I would say that about 20 to 30 
percent of the cost is going to benefit from the global trend 
of high battery volume production, so that cell cost will come 
down, just following global trends. The remaining 70 or so 
percent, that is up to maritime to get that cost down. And that 
is going to be a challenge, because it is generally a low-
volume industry. So I think that is where we can help some of 
our marine battery manufacturers out.
    And I am happy and proud to say that, despite the fact that 
Europe is leading on actually deploying a lot of these battery 
technologies, we actually have a lot of manufacturers right 
here in the U.S. that are actually supplying some of those, two 
in the U.S. and one in Canada that are some of the global 
leaders on marine battery systems.
    Mr. Maloney. On a different subject, would the panel 
comment on the role the Coast Guard plays in the international 
enforcement of some of the issues we have been talking about?
    It was touched on in some of the testimony. What is the 
most effective international enforcement mechanism?
    And can you talk on the role the United States Coast Guard 
will play?
    Mr. Butler. Mr. Chairman, the entire international 
enforcement regime, basically, has two prongs. It is flag-state 
control and it is port-state control. And the U.S. Coast Guard, 
a primary role when we talk about enforcing these environmental 
laws, with respect to international ships it is primarily a 
port-state control operation.
    So it is a question of having the Coast Guard have the 
necessary staff and the necessary tools to efficiently inspect 
vessels to make sure that they are complying with these various 
regulations.
    And, as Dr. Kindberg said earlier, it may sound a little 
strange for industry to be calling for more enforcement, but 
the issue of having a level playing field and making sure that 
we are not distorting commerce here is quite critical.
    Mr. Berger. I would say the other key role that the Coast 
Guard is playing there in terms of inspections is working 
closely with industry as we are commercializing new technology.
    So other maritime authorities around the globe have clear 
standards, let's say, for battery technology, in particular. 
But the United States Coast Guard is working hard and working 
closely on a case-by-case basis for all battery-operated 
systems. We do not have a clear CFR within the Code of Federal 
Regulations on battery technology and battery systems on board 
vessels.
    And so the role that they can play--and I know they are 
working hard to do that, and they are in support. But on--at 
this point they are still working on a case-by-case basis, 
versus having a clear regulation in place to support that. And 
what that does is help industry then make investments as they 
are commercializing new technology, and that is working their 
way up into the fleet.
    Mr. Maloney. Thank you.
    Mr. Gibbs?
    Mr. Gibbs. Thank you. I know Mr. Butler talked about the 
IMO making it by 2050 is probably unlikely, the IMO 
requirements. But I want to pursue this a little bit about the 
technology with Dr. Kindberg.
    What are the horsepower requirements of these 
containerships? They are big ships.
    Ms. Kindberg. Again, it depends on the size of the vessel. 
But when we talk a small vessel, we are talking something that 
is 1\1/2\ football fields long.
    Mr. Gibbs. Yes.
    Ms. Kindberg. And when we talk big, we are talking four 
football fields long. So these are big ships.
    Mr. Gibbs. What kind of horsepower are those engines?
    Ms. Kindberg. And the biggest ones might run two engines 
that are 55,000 horsepower.
    Mr. Gibbs. Are those direct mechanical--not--they are not 
running motors. So running a propulsion system, it is 
mechanical, right, or----
    Ms. Kindberg. It is one big propeller or two big 
propellers, depending----
    Mr. Gibbs. So it is a mechanical, off the----
    Ms. Kindberg. Yes, and you have got a main shaft.
    Mr. Gibbs. Go to Mr. Bryn. When we are talking batteries, 
talking--to make that kind of energy equivalent, what kind of--
the battery technology--I know we have made big strides in the 
last few years in battery technology, but are we anywhere close 
to having that kind of technology to have a battery technology 
to propel through electric motors? That would help the quieter 
issue, too. That is another issue. Where are we in that?
    Mr. Bryn. Yes, thank you, Congressman. The short answer is 
no. And I wouldn't expect batteries to ultimately be the 
solution for oceangoing vessels. I think batteries may play a 
role. They will continue to improve on space and weight and 
cost, which are the three main factors that we have to 
consider.
    I don't think, long term, we ever expect batteries to have 
sufficient energy density for a containership. Where ABB would 
likely expect one potential candidate, are--as I mentioned--
fuel cells, and that is because you get much greater energy 
density in hydrogen fuel than you do in batteries.
    So--but batteries may have a role to play, even with fuel 
cell systems, because they can handle transient loads much 
better. So if you have an instant ramp-up or ramp-down of 
power, the battery can help to keep the fuel cell on a steady 
output. But fuel cells are one of several solutions being 
considered, and it is certainly one that we are focused on.
    Mr. Gibbs. Dr. Kindberg, is Maersk looking at fuel cell 
technology or not?
    Ms. Kindberg. We are looking at it. We are not currently 
using it, commercially.
    Mr. Gibbs. I yield my--thank you.
    Mr. Maloney. Mr. Larsen?
    Mr. Larsen. Thank you.
    Mr. Berger, on the maritime blue strategy that you have, 
that we have in the State, can you comment? Based on your 
experience as a merchant mariner, as well as working in the 
maritime beyond that, can you comment on what you are planning 
to do with regards to workforce development to support these 
changes?
    It seems that sometimes we can flip a switch on the economy 
and move on, but this is new technology, new research and 
development that seems to require maybe not all new skills, but 
some new thinking on how we develop that workforce. What is the 
State doing to prepare for that?
    Mr. Berger. Absolutely. Thank you, Congressman. This is 
another area where I am a firm believer in that ``yes, and'' 
approach. As we are looking at new technology, we are focused 
on innovation, and we are focused on that investment.
    Exactly to your point, we need to be focusing on what the 
next generation maritime workforce looks like, and how we 
approach that. This is a topic, worldwide. In Washington State 
the average age working in the industry right now is 54 years 
old. We call it the silver tsunami. The average----
    Mr. Larsen. Just a minute. I am 54 years old.
    [Laughter.]
    Mr. Berger. And there is a role for you on board a vessel, 
absolutely.
    [Laughter.]
    Mr. Larsen. I am sure there is.
    Mr. Berger. Yes. The majority of ferry captains----
    Mr. Larsen. I can pour a mean bowl of cereal.
    Mr. Berger. Likewise, likewise. The majority of captains 
and chief engineers in our State ferry systems are ready for 
retirement within the next 5 years, the majority of them.
    We also have issues around gender equality and 
underrepresentation of youth of color that are looking at the 
maritime industry as opportunities. That is particular issues 
in Washington State. So those are things that we are 
particularly focused on--Washington Maritime Blue, as a cluster 
organization, is.
    We developed a program called the Youth Maritime 
Collaborative, and trying to create specific workforce 
pipelines and pathways that go right into what we call career-
connected internships and apprenticeships. It is a big focus in 
our State of Washington's workforce development planning. So we 
are paying particular attention both to making sure that we are 
providing pathways, or just the outreach and awareness, 
particularly to underrepresented communities, as well as a 
focus on the new technologies.
    We have done a lot within the State to invest, particularly 
in our trades-based programs. But much like all of the focus, 
there have been parts and pieces from the Federal perspective, 
and focus on both workforce development, as well as in 
innovation, where we do not yet have a coordinated approach. 
There is not one agency that is focused on maritime, or that is 
focused on maritime workforce.
    And so, without kind of a concerted effort, without some 
sort of coordinated approach, we are not able to really make 
the best use of those dollars, or focus those dollars to where 
investments are going to make the most sense.
    Mr. Larsen. I know that the State has signed an MOU with 
the Norwegians. I am not sure which agency in Norway we all 
signed with----
    Mr. Berger. The MOU is between the Washington State 
Department of Commerce and Innovation Norway, which is part of 
their Ministry of Trade, Industry and Fisheries.
    Mr. Larsen. So within that MOU--this is now moving back to 
the technology side of things--within the MOU, I am trying to 
figure out how best to kick-start the challenge that the 
shipping industry has with regards to getting ships that have 
to be ready in 2030 for 2050, and what role that collaboration 
plays in developing, and which technologies that can support 
shipping to meet those goals in 2050.
    Mr. Berger. Right. And even sooner, as Dr. Kindberg was 
saying.
    Mr. Larsen. Yes.
    Mr. Berger. That is on multiple fronts. The big part of the 
relationship between Washington State and Norway has been 
focused on electrification of ferries, in that Norway is a 
global leader in that work. And so the opportunities for 
technology and knowledge transfer have been remarkable, as well 
as some cross-investments.
    We have also found great relationships between the 
different research universities and research labs. So we are 
setting up meetings now between folks in our department of 
energy and the Pacific Northwest National Laboratory and the 
NTNU that is up in Trondheim in Norway that are, you know, 
diving deep into what these potential new fuel source solutions 
might look like, whether they are hydrogen or ammonia or 
likewise.
    So, you know, coupled with Norway's expertise on battery 
technology on ferries, and research institutions that we have, 
I think, coupled expertise with, that is where--that in line, I 
think, focuses on where our MOU is between Washington State. 
And it is about cluster-to-cluster relationships. So they have 
a built-out system that supports these innovation clusters 
across Norway.
    Again, this is a public-private relationship, where you 
have competitors working together to create new markets and 
create new technologies, and with support from Government and 
support from research institutions. And we have found that that 
has been the best way to move forward actual commercialized 
projects that go--that are on the water.
    The first all-electric ferry, Ampere, came out of a joint 
innovation project, out of a cluster organization. The first 
hydrogen ferry that is being built in Norway is coming out of a 
joint innovation project within their cluster organization. 
These are federally funded, or nationally funded programs--some 
of those dollars come from the European Union, as well--coupled 
with private investment and R&D and their research 
institutions.
    And so, yes, we have, you know, business-to-business 
relationships with them as we build out projects. We are also 
learning from one another on how we develop these types of 
joint innovation projects, but we are coupling national Federal 
dollars with private investment.
    Mr. Larsen. Thank you, thank you.
    Mr. Maloney. Mr. Weber?
    Mr. Weber. Thank you, Mr. Chairman. Is it Dr. Kindberg or 
Kindberg? I missed what you said.
    Ms. Kindberg. It is Kindberg, like kindergarten.
    Mr. Weber. Like kindergarten? OK, thank you.
    So you said early--well, let me back into it this way. So 
the American Association of Port Authorities, which consists of 
Canada, the Caribbean, Latin America, United States, I looked 
at their website real quick, just for the benefit of the panel 
and for our group up here. And under their issues they really 
don't talk about any of this. So there is--we are having a 
discussion about having ports build facilities, infrastructure, 
to charge huge batteries on board ships. And shore power, we 
are calling it.
    As I said, I have got five ports in my district, more than 
any other Member of Congress, and actually ran a transportation 
company for a short time, which delivered to ships at the Port 
of Galveston. So I have got some first-hand experience in that.
    Any time you ask a port to build a--whether it is 
electrical, plant, call it whatever you want to--a system of 
building out, you are going to have to be taking--to power 
ships you are going to be taking very, very, very valuable real 
estate to build an energy plant, for example. That is going to 
take away from some of the local economy, because a lot of 
these harbors and these shoresides and stuff, the docks, are 
used to supply these oceangoing vessels.
    In the Gulf of Mexico you can go across--down into 
Galveston, and look during the night, and you can just count 
all the lights, lined out about 40 miles out, 30, 40 miles out, 
because--waiting to get in the Houston Ship Channel. If you use 
that area for electrification, if you will, powering the ship, 
you are taking up a very valuable berth or docking area that 
the ports might not be willing to give up, at least at a very 
low cost.
    Are you with me?
    If you look at the American Association of Port Authorities 
website, they have a list of issues, and none of this is being 
discussed in their issues that I see. So it might behoove us, 
Mr. Chairman, to bring them in here in the next discussion, and 
to say, ``What say you all about the prospect and possibility 
of being able to build out this infrastructure, so that we can 
service these on these oceangoing vehicles?''
    I hope that makes sense, because this is a group that 
really will have a vested interest in it.
    Dr. Kindberg, you said early on that there needed to be an 
agency that could enforce those rules, enforce them fairly, but 
help--something to the effect of, you know, not necessarily 
enforce them early on. Kind of as this--you want to elaborate 
on that for a second?
    Ms. Kindberg. Let me clarify just a little bit. There are 
those of us who are acting early, just like we fuel-switched 
early in California, and it cost us about $20 million. But 
then, when California made it mandatory, we already knew how to 
do it.
    [Pause.]
    Ms. Kindberg. I have lost track of where I was going, I am 
sorry.
    Mr. Weber. Well, let me fill in some blanks here from 
another part of your conversation, while you are thinking.
    So you said a ship coming from China to Europe could save 
$750,000 on that one trip. How many trips can they make? Is it 
one a month? Is it 12 a year? What is it?
    Ms. Kindberg. That trip is maybe 12 weeks.
    Mr. Weber. So it is 3 months.
    Ms. Kindberg. It is--yes.
    Mr. Weber. So we want somebody that is able to enforce 
those rules, and enforce them fairly. And as--I think what you 
are alluding to--as the learning curve is happening, you don't 
necessarily want an agency to come in here and just blast 
everybody with fines and fees if they are acting in good faith. 
I think that is what you are alluding to.
    Ms. Kindberg. Well, the point that I was making is 
sometimes you have people who try something new.
    Mr. Weber. Right.
    Ms. Kindberg. Say if we tried a battery from Mr. Bryn. And 
then a rule were put in place that made that battery no longer 
meet the requirements.
    Mr. Weber. OK.
    Ms. Kindberg. You would want to grandfather that.
    Mr. Weber. Sure.
    Ms. Kindberg. And there are also programs that have been 
put in place by some ports and other entities that have 
actually provided incentives for going beyond the regulatory 
requirements.
    Mr. Weber. Sure.
    Ms. Kindberg. And those have been very effective in some 
places.
    Mr. Weber. And those are voluntary, by the way, those 
incentives.
    Ms. Kindberg. Yes.
    Mr. Weber. And you shouldn't be penalized in case you don't 
want to agree with those.
    Mr. Butler, you look like you wanted to weigh in there for 
a second.
    Mr. Butler. No, I just wanted to emphasize the point that 
Dr. Kindberg made. There is short-term enforcement, if you 
will, and then there is the question of policy development in 
such a way that you create the proper incentives and as Dr. 
Kindberg said, you don't penalize people that have tried things 
new, and you don't set up situations where you are going to 
strand investment----
    Mr. Weber. Sure.
    Mr. Butler [continuing]. Think it through.
    Mr. Weber. Right. And I have been handed a note, Mr. 
Chairman, that Ms. Metcalf would like to weigh in.
    If you can, do that quickly, please.
    Ms. Metcalf. I can do it very quickly. Robust enforcement 
is critical. One thing that has not been mentioned yet is the 
fact that the industry was fully supportive and, in fact, 
recommended initially that the new amendments to MARPOL Annex 
VI has a ban on carriage of noncompliant fuel. So it--you don't 
just have to not use it. After 1 March 2020 you can't have it 
on board.
    Mr. Weber. Thank you, Mr. Chairman.
    Mr. Maloney. I thank the gentleman. I will just note for 
the record that the American Association of Port Authorities, 
to its credit, has a section on its website entitled, 
``Environment and Energy,'' which includes the language, ``As 
environmental leaders in the maritime environment, seaports 
employ alternative fuels, such as electricity, fuel cells, 
solar power, wind energy, and LNG.''
    Mr. Weber. Thank you for that, Mr. Chairman. I scrolled 
quickly and didn't see that. Thank you.
    Mr. Maloney. I am always happy to be helpful to my friend.
    Next, Mr. Lowenthal.
    Mr. Lowenthal. Thank you, Mr. Chair. I would like to follow 
up on the question of hydrogen fuel cells, and where we are 
going with hydrogen fuel cells.
    Kind of an interesting process is taking place in my port 
at this moment. Toyota, which has been one of the leaders in 
hydrogen fuel cells, is in the process of trying to develop a 
facility in the Port of Long Beach, which will generate 
hydrogen to create hydrogen.
    Now, they are going to be using it, I believe--well, first 
of all, let me preface that. And our local utility has some 
issues with that, as that develops, because of the--what it is 
going to take to develop that hydrogen, and how that fits into 
our air quality goals. And so this is not an easy thing.
    But the port is going to go forward with Toyota with a 
demonstration project, and that demonstration project is really 
going to be used for heavy-duty trucks and for yard equipment. 
I think that is the focus, if this hydrogen facility is 
developed, to move forward with that.
    My question is, is there a possibility to use this also? 
Could this be a stepping stone to the maritime industry itself 
to begin to use some of this, if we have a plant in the port 
that actually produces hydrogen?
    Mr. Berger. Congressman, we also in Washington State have a 
couple of demonstration projects----
    Mr. Lowenthal. Yes?
    Mr. Berger [continuing]. Similar to what you are talking 
about. Tacoma Power, which is a utility in the city of Tacoma, 
is also looking at the potential of a demonstration project, 
not only to power, like you say, yard equipment and trucks. 
They also operate a small train that moves containers around 
throughout that yard. Grant County PUD in central Washington 
State is also looking at it.
    That kind of infrastructure, and being able to use those 
demonstration projects to take a look at maritime applications, 
I think, is absolutely critical. And we saw the first passenger 
ferry, hydrogen-powered passenger ferry, in San Francisco. It 
was a partnership that was a private partnership, along with 
technology that came out of the Sandia National Labs. So 
another opportunity for partnering with Federal dollars.
    Our department of energy in the water power technology 
office has focused their energy for wave and tidal on how to 
develop alternative and renewable fuels out at sea. And they 
are looking towards what the maritime applications are for 
offshore and renewable energy.
    So I think all those projects are going to be absolutely 
critical, as we look at a network of what the next future fuel 
looks like, certainly for global and offshore and deep sea, but 
also, as well, for near shore and short sea shipping.
    Mr. Lowenthal. Yes, I get it, I am just wondering and 
listening to--thank you for that. I just see that, with the 
limitations of battery, that we are really looking at, in the 
future, other alternatives. And I certainly think that this is 
a potential.
    I am glad to hear of these demonstration projects. Although 
they have not really reached out yet in our community to deal 
with some of the maritime shipping part, but they are doing, 
you know, every--the--all the other equipment that is needed 
at--in the port, itself, is really what they are going to be 
using it for.
    But I see this as a step in the right direction, and I am 
just wondering if others have any thoughts about that.
    Ms. Metcalf?
    Ms. Metcalf. Thank you, Mr. Chairman. I will be very brief. 
I am not an engineer, I was a deckie, so I like to see the sun. 
I am not technically as proficient as some of my colleagues 
here. But I did pass organic chemistry, as I know you did. And 
even though I am older, I still have to fight to think outside 
the box. But it just keeps coming back to me what water is. It 
is salt, sodium chloride, it is oxygen, and it is hydrogen.
    Mr. Lowenthal. Right.
    Ms. Metcalf. And I think that may be the line that you are 
following.
    We might have a whole ocean out there of potential hydrogen 
fuel, if we can figure out how to actually do it. I will leave 
that up to the certified smart people, though. Thank you.
    Mr. Lowenthal. Thank you.
    Mr. Butler. Mr. Lowenthal, just one observation about that. 
The question you raise, which is a very good one, about how do 
we use some of these demonstration projects to figure out 
perhaps where we go next on a bigger scale----
    Mr. Lowenthal. That is right.
    Mr. Butler [continuing]. Is one of the fundamental research 
and development questions out there, because there has been a 
lot of discussion today about short sea and ferry applications. 
Mr. Bryn properly pointed out that a lot of the technologies 
that are available for those applications are not, in fact, 
scalable, or not likely to be scalable for transoceanic, deep 
sea shipping.
    So I think, as we have this discussion about encouraging 
investment, about ways in which the Government can help, 
private actors can move this forward. We have to keep in mind 
that the scale is different for a transoceanic, international, 
large vessel sector than it is for the short sea sector.
    Mr. Lowenthal. Right.
    Mr. Butler. And we can't make the mistake of simply saying, 
if batteries work for ferries, we just need a bigger battery. 
That is not necessarily the case.
    Mr. Berger. Congressman, on your example about the 
demonstration projects, you know, I guess the one thing I 
wanted to point back out, as well, is as we were working with 
the national laboratory systems and the Department of Energy, 
as well as Coast Guard and MARAD and NOAA and the Department of 
Commerce and EDA funding, there are parts and pieces of folks 
across the Federal agencies and enterprise that are having 
small parts of this discussion separately.
    Until we kind of have a focus and organized conversation, I 
think, across the Federal enterprise, it is going to be hard 
for us to make the right investments and to the right vessels. 
As Congressman Lamb was talking about, it is going to be hard 
for us to understand the nuances of different vessel types and 
different appropriate fuel types for different--so until we 
have that level of organized approach and directed funding 
towards that, it is going to be hard for us to really start to 
scale and have those level of conversations.
    And I think cluster organizations, coupled with your 
focused approach, can really help us make some leap-forwards.
    Mr. Maloney. Well, I thank you very much, and----
    Mr. Lowenthal. I yield back.
    Mr. Maloney [continuing]. I thank the panel.
    If there are no further questions, I would just conclude by 
saying, you know, it is just clear from this conversation--and 
one of the reasons behind today's hearing--is that many of us 
up here do understand that if we are going to ask you to be who 
we want you to be, we are going to have to be who you need us 
to be, in terms of the role the public sector needs to play. 
And I think that effective teamwork between the public and 
private sector in this area, as in so many, is critical.
    And so we are very interested in continuing to understand 
the productive role the Congress can play, the Federal 
Government can play, and the public sector can play, in terms 
of resolving some of these issues of effective enforcement, 
getting you the basic research and investments necessary to 
bring these technologies to market in an economically efficient 
way. Some of the political issues involving shoreside 
infrastructure and the tradeoffs there, they are all legitimate 
concerns and questions. But working together, there is not a 
reason in the world we can't solve these issues and make your 
industry more successful, more efficient in time to do us some 
good in terms of our responsibilities to the climate.
    So, with that, seeing no further questions, I would like to 
thank all the witnesses for participating in today's hearing. 
Your contribution has been tremendous.
    And I would ask unanimous consent that the record of 
today's hearing remain open until such time as the witnesses 
have provided answers to any questions that may have been 
submitted to them in writing.
    So ordered.
    And I ask further unanimous consent that the record remain 
open for 15 days for any additional comments and information 
submitted by Members or witnesses to be included in the record 
of today's hearing.
    Without objection, so ordered.
    If no one has anything else to add, we will stand 
adjourned. Thank you.
    [Whereupon, at 11:40 a.m., the subcommittee was adjourned.]



                       Submissions for the Record

                              ----------                              

   Prepared Statement of Hon. Peter A. DeFazio, a Representative in 
     Congress from the State of Oregon, and Chairman, Committee on 
                   Transportation and Infrastructure
    Thank you, Chairman Maloney, I commend you for taking up the topic 
of ``green shipping'' as the first hearing in the new year for the 
Subcommittee on Coast Guard and Maritime Transportation.
    Since new international low sulfur emission standards for marine 
transportation kicked in two weeks ago, the timing of this hearing 
could not be more appropriate.
    For too long global marine carriers have been able to evade 
complying with emission control standards, notwithstanding the fact 
that other transportation modes did have to comply with emission 
standards to reduce a whole host of noxious emissions and other harmful 
particulate matter from cars, trains, and planes.
    Slowly, the International Maritime Organization was able to build a 
consensus on a schedule of emission reductions, that when fully 
implemented, will have reduced absolute vessel emissions by at least 50 
percent from the 2008 baseline. This is a very positive development 
that stands to improve air quality and reduce human health impacts. I 
commend the IMO for taking this initiative and moving ahead, but we can 
and must do better.
    The world's largest shipping company has set a goal of zero 
emissions by 2050, but that should be a goal for the entire industry. 
If the maritime industry merely reduces vessel emissions by 50 percent 
over the next 30 years, the impact of such a reduction could be largely 
offset by an increase in vessel traffic.
    But to meet even the 50 percent reduction target, the global 
maritime industry must overcome substantial technical, economic, 
financial, and logistical challenges.
    It is the discussion of those challenges that most interests me, in 
particular how this scenario could play out here in the United States.
    For example, it remains uncertain what role the Federal government 
will play in fostering or facilitating the transition to a carbon-free 
maritime industry for both our coastwise and foreign trades.
    If anything, over the past thirty years the maritime industry has 
become almost an orphaned child and an afterthought in the Department 
of Transportation. And were it not for the Navy shipbuilding program, 
our shipbuilding industry might have entirely lost its capability to 
build ocean-going vessels.
    Additionally, the switch to a carbon-free maritime industry will 
have repercussions across more than just the vessels themselves. 
Corresponding impacts also will affect port facilities and maritime 
industries that provide fuels, logistical support, and stevedoring for 
the new ``green'' fleet of vessels calling on U.S. ports.
    So, when we take up the topic of ``green shipping'' we are talking 
about much more than just new, innovative vessel designs, or low sulfur 
fuels. We are talking about a dynamic shift. A shift that in a 
relatively short fifteen- to thirty-year period will result in the 
virtual makeover of the conventional global maritime transportation 
system.
    This is exciting stuff. There are, however, no assurances that we 
will end up with a new global maritime supply chain that is more 
efficient and less harmful to the global environment. The only way 
forward is to engage the industry to learn what they are doing and to 
determine the best course of action for the Federal government.
    If one thing is clear today it is this: we can no longer afford to 
sit on our hands and be idle. Collectively, both the Congress and the 
administration need to get to work today reimagining the maritime 
industry of tomorrow.

                                 
  Prepared Statement of Hon. Sam Graves, a Representative in Congress 
     from the State of Missouri, and Ranking Member, Committee on 
                   Transportation and Infrastructure
    Thank you, Chairman Maloney, and thank you to our witnesses for 
being here today.
    If the international shipping community were a foreign nation, they 
would rank sixth in the world in terms of air emissions from ships. In 
light of those significant emissions levels, new International Maritime 
Organization (IMO) rules went into effect on January 1st, and IMO has 
set more stringent air emission reduction targets for 2030 and 2050.
    I applaud the industry for tackling this issue head on, including 
proposing new ways to raise funds for research on reducing carbon 
emissions.
    With that said, we want to make sure any regulations or set targets 
are realistic and achievable.
    I look forward to hearing the witnesses' assessment of the new 
rules which just went into effect, and their views on how the industry 
will meet the 2030 and 2050 goals.

                                 
  Letter of January 14, 2020, from David Bolduc, Executive Director, 
  Green Marine, Submitted for the Record by Hon. Sean Patrick Maloney
                                                  January 14, 2020.
Hon. Sean Patrick Maloney,
Chairman,
Subcommittee on Coast Guard and Maritime Transportation, U.S. House 
        Committee on Transportation and Infrastructure, 2331 Rayburn 
        House Office Building, Washington, DC.
Hon. Bob Gibbs,
Ranking Member,
Subcommittee on Coast Guard and Maritime Transportation, U.S. House 
        Committee on Transportation and Infrastructure, 2446 Rayburn 
        House Office Building, Washington, DC.

RE: Comments regarding the January 14th Subcommittee on Coast Guard and 
Maritime Transportation's Hearing on The Path to a Carbon-free Maritime 
Industry: Investments and Innovation

    Dear Chairman Maloney and Ranking Member Gibbs,
    Green Marine appreciates the opportunity to submit these comments 
regarding the January 14th hearing titled The Path to a Carbon-free 
Maritime Industry: Investments and Innovation. This hearing comes at a 
critical time, as the maritime industry moves to meet the International 
Maritime Organization 2030 and 2050 carbon emissions reduction goals.
    In our comments, we would like to address the importance of 
collaboration between the maritime industry, government, and NGOs; how 
essential is a clear, data-based, enforced regulatory baseline; and 
finally, the value of voluntary programs to achieve greater 
sustainability.
Our work and goals
    Established in 2007, Green Marine is a voluntary marine industry 
certification program with the goal of achieving increasing levels of 
environmental performance that exceed regulatory requirements. There 
are currently more than 140 ship owners, port authorities, terminals 
and shipyards from coast to coast in the United States and Canada 
participating in the program \1\. The Green Marine environmental 
certification program addresses key environmental issues through 12 
performance indicators that include greenhouse gases, air emissions, 
spill prevention, waste management, environmental leadership, and 
community impacts--some applicable to shipping activities, others to 
landside operations. The certification process is rigorous and 
transparent with results independently verified every two years. Each 
company's individual performance is evaluated and made public annually.
---------------------------------------------------------------------------
    \1\ A complete list of all Green Marine participants is available 
online here: https://green-marine.org/wp-content/uploads/2017/07/
GM_Members_December2019.pdf
---------------------------------------------------------------------------
    Green Marine's mission is to advance environmental excellence. Our 
environmental certification program offers a detailed framework for 
maritime companies to first establish and then reduce their 
environmental footprint. Our participants--ship owners, port 
authorities, Seaway corporations, terminal operators and shipyard 
managers--have to demonstrate year-over-year improvement in measurable 
ways to maintain their Green Marine certification.
    Green Marine's success as the premier environmental certification 
program for North America's maritime industry stems in good part from 
its efforts to identify and address regional as well as continental 
issues. As a result, some of the performance indicators have been 
developed to protect specific habitat and/or species in a region or to 
deal with particular maritime operations within that area. The program 
has earned support from more than 70 environmental organizations, 
scientific research programs and government agencies. These supporters 
\2\ contribute to shaping and revising the program.
---------------------------------------------------------------------------
    \2\ A complete list of all Green Marine Supporters is available 
online here: https://green-marine.org/members/supporters/
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The importance of a collaborative approach
    As Green Marine has grown, we have still held true to our founding 
goals to strengthen our industry's environmental performance and strive 
for continual improvement; engage with government agencies and gain 
their recognition, input, and support for the industry's efforts and 
outcomes towards sustainability; and, build our relationships with the 
NGO and environmental community. Familiarize them with the industry's 
advancement and benefits. Earn their trust and support.
    For example, Green Marine formally engaged in a few strategic 
Memorandums of understanding. The MoU signed on October 2013 with the 
American Association of Port Authorities was pivotal to Green Marine 
membership expansion in the United States, raising the number of 
participating U.S. ports from the initial five in Green Marine to the 
current 22 American ports. Through this agreement, the AAPA and Green 
Marine formally recognize their mutual interests and support and share 
common goals to advance environmental protection at seaports in the 
Western Hemisphere.
    AAPA determined that the Green Marine program is legitimate, 
applicable, voluntary and scalable for port authority and marine/
intermodal terminal operations, and the association encourages their 
members who find it beneficial to their operations to participate in 
the program.
    Green Marine also seeks international and technical collaborations. 
For example, the Society of Naval Architects and Marine Engineers 
(SNAME) became a new association member of Green Marine in March 2019 
and signed an accord with Green Marine to further their common goals in 
fostering greater environmental sustainability in the maritime sector. 
The partnership will enhance the exchange of technical information 
between Green Marine and SNAME to further minimize the environmental 
impact of marine commerce.
    Last year, Washington State rolled out its plan to accelerate 
maritime tech innovation, create jobs, protect the environment, and 
ensure industry sustainability and growth. Maritime Blue 2050 is the 
first initiative of its kind in the United States, and Green Marine is 
proud to be recognized within the strategy and to have supported the 
development and now the implementation and leadership for the strategy 
through West Coast & US Program Manager Eleanor Kirtley serving on the 
Steering Committee and Board of Directors.
    Green Marine counts 30 associations members, a dozen based in the 
United States.\3\ We believe a collaborative approach is essential to 
tackle the decarbonisation challenge, and Green Marine makes a point of 
fostering partnerships within the industry and outside. Our regional 
advisory committees and workgroups bring a diversified group of 
stakeholders (industry representatives, NGOs, governmental agencies, 
academics, technology suppliers, etc.) to the table to discuss the 
environmental program development.
---------------------------------------------------------------------------
    \3\ A complete list of all Green Marine Association members is 
available online here: https://green-marine.org/members/associations/
---------------------------------------------------------------------------
The regulatory baseline
    Green Marine criteria regularly undergo reassessment to ensure that 
all levels are sufficiently demanding in relation to existing or 
imminent regulations, as well as the availability and feasibility of 
new technologies and/or best management practices. The 2020 IMO sulfur 
emissions regulation, for example, influenced our indicator on Sulfur 
oxides (SOx) and particulate matter (PM) emissions. Green Marine 
supports clear, data-based, and enforced regulations for the marine 
transportation industry so we can provide our ship owners, port 
authorities, terminals and shipyards operators with a detailed and 
comprehensive set of criteria helping them stay beyond compliance.
The positive, effective impact of voluntary programs
    Green Marine has a track record of measured improvement, year on 
year for the past twelve years. On a scale of Levels 1 to 5, where 1 is 
the regulatory baseline and 5 stands for Excellence and Leadership, 
half of our participants reach an average of Level 3 and above. Our 
participants who have been in the program the longest, on average 
achieve the highest levels. We have gone beyond environmental 
compliance while growing the program scope of the environmental issues, 
strengthening the criteria each year, and increasing the number of 
participants. Membership has grown by 10% year on year. The growth of 
our membership proves that it answers a need and a tangible desire 
within the industry for a voluntary program under which participants 
take on concrete steps to minimize the environmental impacts of their 
activities. The overall level improvements registered by all the 
different types of participants in the latest results \4\ is a 
testimony to the real commitment by the membership to continually 
strive to do better while accepting greater challenges.
---------------------------------------------------------------------------
    \4\ The latest results relate to the 2018 year of operation and are 
published in Green Marine 2018 Annual Performance report (https://
green-marine.org/wp-content/uploads/2019/06/2018Perfo_Report_final_WEB-
1.pdf). The evaluation period for the 2019 operations is currently in 
progress and the next results will be released in early June 2020.
---------------------------------------------------------------------------
Conclusion
    Thank you for the opportunity to voice our support for clean 
shipping initiatives; for collaboration with industry and NGOs; for 
clear, data-based, and enforced regulations; and for recognition for 
the efficacy of voluntary programs like ours for example.
    It is gratifying to have Green Marine's certification program 
recognized by more and more enterprises as a challenging but feasible 
approach to improve sustainability through a step-by-step framework to 
address priority issues. We hope that the international regulatory 
shift towards more stringent requirements and the general public 
increased awareness towards sustainability can promote a culture of 
continual improvement beyond regulatory compliance. We also 
respectfully hope Green Marine can continue play a central role in 
intensifying dialogue and direct collaboration between the maritime 
industry and stakeholders (NGOs, governments, municipalities, 
scientists, etc.), and establishing and/or strengthening the existing 
collaborations and environmental strategies with partners in both 
Canada and the United States.
    Thank you again for the opportunity to submit these comments 
regarding the Subcommittee on Coast Guard and Maritime Transportation's 
hearing on The Path to a Carbon-free Maritime Industry: Investments and 
Innovation.
        Sincerely,
                                              David Bolduc,
                                  Executive Director, Green Marine.

                                 
  Letter of January 14, 2020, from Daniel Hubbell, Shipping Emissions 
 Campaign Manager, Ocean Conservancy, Submitted for the Record by Hon. 
                          Sean Patrick Maloney
                                                  January 14, 2020.
Hon. Sean Patrick Maloney,
Chairman,
Subcommittee on Coast Guard and Maritime Transportation, U.S. House of 
        Representatives, 2331 Rayburn House Office Building, 
        Washington, DC.
Hon. Bob Gibbs,
Ranking Member,
Subcommittee on Coast Guard and Maritime Transportation, U.S. House of 
        Representatives, 2446 Rayburn House Office Building, 
        Washington, DC.
    Dear Chairman Maloney and Ranking Member Gibbs,
    Ocean Conservancy thanks the Subcommittee for highlighting the 
pressing challenges of climate and the maritime industry in the 
upcoming hearing on The Path to a Carbon-Free Maritime Industry. 
Shipping, both domestic and international, accounted for approximately 
2.6% of global CO2 emissions in 2015.\1\ This places the sector in the 
same class as a G7 country, roughly equivalent to Germany's national 
emissions. While the sector continues to improve its energy efficiency 
and remains more efficient than any other form of cargo transportation, 
these improvements have not kept pace with the growth of trade, and 
emissions have continued to increase.\2\ If no advances in technology 
and low or zero carbon fuels are adopted, emissions from shipping could 
continue to grow up to 250% from 2012 levels by 2050.\3\ The industry 
can adapt but an effort from government and industry is needed.
---------------------------------------------------------------------------
    \1\ Olmer, N., Comer, B., Roy, B., Mao, X., Rutherford, D. (2017). 
Greenhouse Gas Emissions from Global Shipping, 2013-2015. The 
International Council on Clean Transportation. Available at: https://
theicct.org/publications/GHG-emissions-global-shipping-2013-2015
    \2\ Ibid. At 8
    \3\ Balcombe, P., Brierley, J., Lewis, C., Skatvedt, L., Speirs, 
J., Hawkes, A., & Staffell, I. (2019). How to decarbonise international 
shipping: Options for fuels, technologies and policies. Energy 
conversion and management, 182, 72-88.
---------------------------------------------------------------------------
    While shipping is a prime contributor to climate change, it is also 
exposed to its impacts. Many American ports are vulnerable to sea-level 
rise and storm surges made worse by climate change. Even temporary 
disruptions of these facilities have serious economic consequences. For 
instance, in the aftermath of Hurricane Sandy the Port Authority of New 
York and New Jersey was forced to divert more than 25,000 shipping 
containers to other ports, part of an estimated $2.2 billion in damages 
and losses to the Authority.\4\ Rising seas also impact our naval 
bases. In the past ten years, Norfolk Naval Shipyard has suffered nine 
major floods that damaged equipment.\5\ At present, few American ports 
are climate resilient or ready for the realities of a world that has 
already warmed more than 1.8 +F from pre-industrial levels, and could 
rise to more than 2.7 +F by 2030.\6\ It is clear that we need to build 
resilience to climate impacts--and significantly reduce greenhouse gas 
emissions from all sources.
---------------------------------------------------------------------------
    \4\ Strunsky, S. (2019). Port Authority puts Sandy damage at $2.2 
billion, authorizes $50 million to power wash PATH tunnels. NJ.com 
Available at: https://www.nj.com/news/2013/10/
port_authority_sandy_22billion_outlines_recovery_measures.html
    \5\ Kusnetz, N. (2018). Rising seas threaten Norfolk Naval 
Shipyard, raising fears of `catastrophic change'. NBC News. Available 
at: https://www.nbcnews.com/news/us-news/
rising-seas-threaten-norfolk-naval-shipyard-raising-fears-catastrophic-
damage-n937396
    \6\ IPCC, 2018: Summary for Policymakers. In: Global Warming of 1.5 
+C. An IPCC Special Report on the impacts of global warming of 1.5 +C 
above pre-industrial levels and related global greenhouse gas emission 
pathways, in the context of strengthening the global response to the 
threat of climate change, sustainable development, and efforts to 
eradicate poverty [Masson-Delmotte, V., P. Zhai, H.-O. Portner, D. 
Roberts, J. Skea, P.R. Shukla, A. Pirani, W. Moufouma-Okia, C. Pean, R. 
Pidcock, S. Connors, J.B.R. Matthews, Y. Chen, X. Zhou, M.I. Gomis, E. 
Lonnoy, T. Maycock, M. Tignor, and T. Waterfield (eds.)]. In Press.
---------------------------------------------------------------------------
    In 2018, the International Maritime Organization (IMO) adopted its 
Initial IMO Strategy on Reduction of GHG Emissions from Ships.\7\ The 
ultimate goal is to eliminate greenhouse gas (GHG) emissions from the 
sector as soon as possible, and reduce emissions by at least 50% from 
2008 levels by 2050.\8\ In our view it is essential that full 
decarbonization of the shipping sector be achieved as soon as possible, 
and no later than 2050. Notably, shipping was not directly included in 
the Paris Agreement.\9\
---------------------------------------------------------------------------
    \7\ IMO. (2018). Resolution 304(72). Available at: Initial IMO 
Strategy on Reduction of GHG Emissions from Ships http://www.imo.org/
en/OurWork/Documents/Resolution%20MEPC.304%
2872%29%20on%20Initial%20IMO%20Strategy%20on%20reduction%20of%20GHG
%20emissions%20from%20ships.pdf
    \8\ Rutherford, D. & Comer, B. (2018). The International Maritime 
Organization's initial greenhouse gas strategy. The International 
Council on Clean Transportation. Available at: https://theicct.org/
publications/IMO-initial-GHG-strategy
    \9\ Light, J. (2018). A Paris Agreement for the Shipping Industry. 
UN Dispatch. Available at: https://www.undispatch.com/a-paris-
agreement-for-the-shipping-industry/
---------------------------------------------------------------------------
    Many technologies and operational changes are available today to 
reduce a ship's GHG emissions. Ships can slow down to save fuel; 
reducing speed by 20% can not only reduce emissions by up to 34% but 
also potentially reduce other environmental impacts, such as underwater 
noise or air pollution.\10\ Ship operators can also install wind-
assisted propulsion technologies that can significantly reduce fuel 
consumption, up to 47% for some ships.\11\ Additionally, hull air 
lubrication systems can cut fuel use and emissions by 10% or more.\12\ 
The sector will require a combination of energy-saving technologies, 
such as wind-assisted propulsion, as well as alternative zero or low-
carbon fuels, such as hydrogen or ammonia, to truly decarbonize by 
midcentury.\13\ These technological and operational changes present 
opportunities for the industry; however the lifespan of vessels 
requires coordination and innovation to be successful.
---------------------------------------------------------------------------
    \10\ Leaper, R. C. (2019). The role of slower vessel speeds in 
reducing greenhouse gas emissions, underwater noise and collision risk 
to whales. Frontiers in Marine Science, 6, 505.
    \11\ Comer, B., Chen, C., Stolz, D., & Rutherford, D. (2019). 
Rotors and bubbles: Route-based assessment of innovative technologies 
to reduce ship fuel consumption and emissions. The International 
Council on Clean Transportation. Available at: https://theicct.org/
publications/working-paper-imo-rotorships
    \12\ Ibid. at 8.
    \13\ Hall, D., Pavlenko, N., & Lutsey, N. (2018). Beyond road 
vehicles: Survey of zero-emissions technology options across the 
transport sector. The International Council on Clean Transportation. 
Available at: https://theicct.org/publications/zero-emission-beyond-
road-vehicles
---------------------------------------------------------------------------
    Given the lifespan of oceangoing vessels (oceangoing ships 
routinely sail for 20-30 years or more,\14\ while Great Lakes ships 
have been known to last for over 100 years \15\), the first zero 
emission oceangoing vessels must be on the water by 2030 if there is 
any chance for decarbonization by 2050. In recognition of this, The 
Getting to Zero Coalition, an alliance of more than 90 companies from 
multiple sectors, formed in 2019 with the purpose of getting commercial 
deep sea zero emission ships on the water by 2030.\16\ Although use of 
these fuels would constitute a radical shift for the industry, shipping 
has demonstrated its ability to adapt and change fuel types over its 
history, including in the global shift to lower sulfur fuels that began 
on January 1st, 2020.\17\
---------------------------------------------------------------------------
    \14\ UNCTAD. (2019). Review of maritime transport 2019. United 
Nations Conference on Trade and Development. Available at: https://
unctad.org/en/pages/PublicationWebflyer.aspx?
publicationid=2563
    \15\ Greene, M. (2019, April 18). Former `jinx ship' breezes 
through Chicago without a hitch. The Chicago Tribune. Available at: 
https://www.chicagotribune.com/news/breaking/ct-met-st-marys-
challenger-barge-chicago-20190416-story.html
    \16\ Global Maritime Forum. (2019). Getting to Zero. Available at: 
https://www.globalmaritimeforum.org/getting-to-zero-coalition/
    \17\ Balcombe et al. 2019
---------------------------------------------------------------------------
    The United States alone accounts for approximately 8% of global 
trade and has the opportunity to be a leader. Billions of dollars of 
goods flow through our ports each day.\18\ Moreover, the United States 
has the technical know-how to be a leader in zero emission 
technologies, with world-class research facilities, such as Sandia 
National Laboratories, which have done research on zero emission 
vessels and their fuels.\19\ These innovative research labs and 
technical know-how place the United States in a strong position to 
foster innovation and drive the operational and technological changes 
the maritime industry needs if it is to decarbonize successfully.
---------------------------------------------------------------------------
    \18\ O'leary, A. (2019). Legal Pathways to Deep Decarbonization In 
the United States. Chapter 17: Shipping. Edited by Gerrard, M.B., and 
Dernbach, J.C. Environmental Law Institute.
    \19\ Sandia National Laboratories. (2019). Maritime applications 
for hydrogen fuel cells. Available at: https://energy.sandia.gov/
programs/sustainable-transportation/hydrogen/
market-transformation/maritime-fuel-cells/
---------------------------------------------------------------------------
    As this Subcommittee considers what incentives and support U.S. 
vessels need to thrive in a decarbonized maritime industry, Ocean 
Conservancy suggests the following options,
    1.  Support collaboration across ports. Some U.S. ports, such as 
Long Beach, Los Angeles, and New York/New Jersey, have already 
committed to exploring investment in alternative fuels and other 
initiatives like onshore power, but more work is needed. In the long 
term, such investment by multiple ports could open the possibility of 
zero emission short sea shipping by U.S. flagged ships.
    2.  Explore a federal fuel tax per ton of CO2 emitted by maritime 
ships entering U.S. ports. Not only could a tax encourage more energy 
efficient ships in the short term but the proceeds could finance 
research and development of zero emission ships.\20\ \21\
---------------------------------------------------------------------------
    \20\ Id. At 456
    \21\ Wan, Z., El Makhloufi, A., Chen, Y., & Tang, J. (2018). 
Decarbonizing the international shipping industry: Solutions and policy 
recommendations. Marine pollution bulletin, 126, 428-435.
---------------------------------------------------------------------------
    3.  Offer grants for development of zero emission technologies or 
tax incentives for companies which install fuel saving equipment such 
as wind-assisted propulsion technologies, such as rotor sails.
    4.  Identify innovative initiatives to reduce shipping emissions 
within individual ports and states, and encourage their regional and 
national adoption.
    5.  Fund the procurement of zero emission vessels for government 
agencies. By procuring zero emission vessels, the government can, in 
partnership with both public and private ports, build the market for 
zero emission fuel infrastructure within key ports, either with 
additional direct financial support or in public-private partnerships.
    6.  Encourage the U.S. delegation to the IMO to support ambitious 
global standards that encourage the worldwide uptake of zero-carbon 
fuels and technologies. We encourage the Subcommittee to consult with 
the U.S. Coast Guard, which is the lead agency for the IMO, on its 
current position, and its own cross agency discussions with other 
relevant agencies like the Environmental Protection Agency (EPA) and 
the National Oceanic and Atmospheric Administration (NOAA).

    As you work to develop a strategy for zero emissions vessels, we 
encourage the Committee take a collaborative approach engaging maritime 
industry stakeholders, lead maritime federal agencies, and 
nongovernmental groups like Ocean Conservancy to develop a robust 
approach that allows us all to move toward a decarbonized future.
    Thank you for your consideration of this important topic. Ocean 
Conservancy looks forward to working with you as you develop solutions.
        Thank you,
                                            Daniel Hubbell,
            Shipping Emissions Campaign Manager, Ocean Conservancy.

                                 
 Letter of January 13, 2020, from Bruce Appelgate, Associate Director, 
 Scripps Institution of Oceanography, Submitted for the Record by Hon. 
                          Sean Patrick Maloney
                                                  January 13, 2020.
  A zero-emission hydrogen fuel cell oceanographic research vessel at 
                  Scripps Institution of Oceanography
    Scripps Institution of Oceanography urgently needs a new research 
vessel to replace its venerable R/V Robert Gordon Sproul, which after 
serving scientists, students and engineers for 38 years has reached the 
end of its service life. Ships like Sproul are critical for 
understanding the physical and biological processes in our oceans, and 
how they are impacted by human activities.
    We are actively engaged in designing a new replacement vessel. We 
envision a new state-of-the-art ship that will carry on the important 
scientific activities that Sproul has made possible, and to provide new 
and compelling educational opportunities for upcoming generations of 
scientists, engineers, policy makers and educators during this time of 
rapid environmental change.
    A key part of such a vessel is a clean power plant that fits our 
University's pledge to become carbon neutral by 2025. In November 2013, 
President Janet Napolitano announced the Carbon Neutrality Initiative 
\1\, which commits the University of California to emitting net zero 
greenhouse gases from its buildings and vehicle fleet by 2025, 
something no other major university system has done. As part of the UC 
San Diego campus, Scripps is joined in this effort. We have completed a 
feasibility study \2\ to build and operate a Zero Emission Research 
Vessel (ZERO-V) that uses a fuel cell system to convert liquid hydrogen 
fuel to electricity to supply all the power required on board. This 
comprehensive study demonstrated the technical and regulatory 
feasibility of a coastal research vessel powered solely by hydrogen 
fuel cells.
---------------------------------------------------------------------------
    \1\ University of California Carbon Neutrality Initiative, 
www.ucop.edu/carbon-neutrality-initiative
    \2\ Klebanoff, L. E. et al, Feasibility of the Zero-V: A zero-
emission hydrogen fuel-cell, coastal research vessel, Sandia National 
Laboratories, Livermore CA, 2017.
---------------------------------------------------------------------------
    For a research vessel, the advantages of using hydrogen fuel cells 
are considerable. Zero emissions hydrogen technology allows the 
collection of air samples with no contamination from vessel exhaust. 
Since fuel cells are very low noise power systems, such research 
vessels are quieter and thus radiate substantially less underwater 
noise, which enables better scientific acoustic operations reduces 
noise impacts on marine wildlife. PEM fuel cells offer faster power 
response than internal combustion engine technology, which is an 
advantage in vessel handling and positioning. Fuel cells generate pure, 
deionized water which is needed for laboratory use and can also be 
treated to use as the ship's source of potable water (both of which we 
currently go to great lengths to produce this at sea). No fossil fuels 
on board means there is no risk of an oil spill, which improves our 
ability to work in sensitive habitats without fear of polluting them.
    This is a game-changing approach to marine power that, if 
demonstrated and adopted widely, could significantly reduce pollution 
and CO2 emissions from ships, which have been shown to have major 
health impacts on population centers ashore, and contribute to 
greenhouse warming. To realize our vision of clean renewable marine 
hydrogen power, we are faced with substantial challenges. The federal 
regulatory framework for building and operating U.S.-flagged liquid 
hydrogen-fueled ships is a work in progress, and requires important 
participation by the U.S. Coast Guard. Most of the hydrogen available 
today is ``dirty''--it is derived from methane in a process that 
releases methane's carbon into the atmosphere as CO2. For hydrogen fuel 
to be truly CO2-free it needs to be sourced from hydrolysis of water 
using renewable power. Hydrogen currently costs more than diesel per 
mile, meaning that the cost of operating a clean ship is currently more 
than operating one that uses fossil fuels.
    All of these challenges can be overcome with the maturation of the 
hydrogen industry in general, and the maritime hydrogen power sector in 
particular. I urge congress to work with the hydrogen and maritime 
industries so that we can develop a production and distribution 
infrastructure in America that can reliably provide clean hydrogen to 
consumers, at rates that are competitive with polluting fossil fuels.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


        Sincerely,
                                           Bruce Appelgate,
           Associate Director, Scripps Institution of Oceanography.

                                 
Letter of January 14, 2020, from Jesse N. Marquez, Executive Director, 
Coalition For A Safe Environment, Submitted for the Record by Hon. Sean 
                            Patrick Maloney
                                                  January 14, 2020.
Hon. Sean Patrick Maloney,
Chairman,
Subcommittee on Coast Guard & Maritime Transportation, U.S. House 
        Committee on Transportation and Infrastructure, 2331 Rayburn 
        House Office Building, Washington, DC.
Hon. Bob Gibbs,
Ranking Member,
Subcommittee on Coast Guard & Maritime Transportation, U.S. House 
        Committee on Transportation and Infrastructure, 2446 Rayburn 
        House Office Building, Washington, DC.
Subcommittee on Coast Guard & Maritime Transportation,
507 Ford House Office Building, Washington, DC.

RE: Subcommittee on Coast Guard and Maritime Transportation's Hearing 
on The Path to a Carbon-Free Maritime Industry: Investments and 
Innovation on January 14, 2020

SU: Public Comments

    Dear Chairman Maloney and Ranking Member Gibbs:
    The Coalition For A Safe Environment as a member of the Moving 
Forward Network respectfully submits our public comments to the 
Subcommittee on Coast Guard and Maritime Transportation's Hearing on 
The Path to a Carbon-Free Maritime Industry: Investments and 
Innovation.
    The Moving Forward Network is a national network of over 50 member 
organizations that centers grassroots, frontline-community knowledge, 
expertise, and engagement from communities across the US that bear the 
negative impacts of the global freight transportation system. The 
Moving Forward Network builds the capacity of network participants 
working to improve the U.S. Freight Transportation System in the areas 
of environmental justice, public health, quality of life, the 
environment and labor.
    We thank you for the opportunity to submit public comments on the 
following themes:
      Industry Resistance To Innovation & Decarbonization of 
the Maritime Industry
      Benefits of Decarbonization
      Status of Zero Emissions On-Road Freight Transportation 
Vehicles
      Status of Zero Emissions Off-Road Cargo Handling 
Equipment
      Status of Ship Emissions Capture & Treatment Technologies
      Status of Zero Emission Ships and Barges
      Status of Zero Emissions Construction Equipment
      International Maritime Organization Standards--MARPOL 
Annex 6, 13
      Current & Past Port Freight Transportation, 
Infrastructure & Mitigation Funding Mechanisms
      Homeland Security
1. Industry Resistance To Innovation & Decarbonization of the Maritime 
                                Industry
    We have witnessed numerous times year-after-year, project-after-
project Ports, Terminal Operators, Railyard, Shipping and Trucking 
Companies resistance to the introduction of clean zero emission 
technologies and even emission capture and treatment technologies 
across all sectors of on-road, off-road and ocean going vessel, freight 
transportation vehicles and cargo handling equipment.
    We understand that new innovative technologies take time to 
develop, a significant upfront investment and time to mature just like 
all of their predecessors. Even today proven certified new Class 8 
Diesel Engine Drayage Trucks off the production line breakdown for 
various equipment failure reasons. It requires patience, understanding 
and diligence to prevail.
      It is a fact that new technologies will eventually 
replace old technologies.
      It is a fact the new technologies are more cost-effective 
and efficient than old technologies.
      It is a fact that most new technologies have zero 
emissions.
      It is a fact that there are governmental agency approved 
ship emissions capture and treatment technologies.

    Ports, Terminal Operators, Railyard, Shipping and Trucking 
Companies historically have not introduced one new carbon-free or zero 
emissions technology on their own accord in the last 20 years.
    It has been public comments, public outcry, protests, 
demonstrations, environmental lawsuits, grass roots campaign to replace 
elected officials with progressive candidates and new public sponsored 
laws, rules, regulations, programs that has allowed innovation and 
change to occur.
    It has been the public and community organizations partnering and 
supporting new innovative technology companies that has opened the 
Pandora's Box and the challenge to the sacred cow.
    In 2001 it took San Pedro, California homeowners associations and 
residents to file an environmental lawsuit against the #1 largest 
container port in the U.S. the Port of Los Angeles to force them to 
incorporate clean technologies. The Port of Los Angeles was so arrogant 
they did not even prepare an environmental Impact Statement/
Environmental Impact Report for the new China Shipping Terminal. They 
were found guilty, a court injunction ordered them to cease and desist 
all construction on a 60% completed new terminal and established a $ 50 
million Miitgation Fund.
    The Plaintiffs demanded that the new terminal be electric, the Port 
of Los Angeles refused saying it was not feasible and not cost-
effective. The court disagreed. Several studies have now been published 
which disclosed that it is in fact cheaper for a ship to plug-in then 
use bunker fuel.
    The courts ordered the Port of Los Angeles to build the first 
electric shorepower terminal, retrofit 70% of the ships to plug-in, 
install diesel truck emission capture technologies and mitigate 
community impacts. The settlement also required the use of Low-Sulfur 
Marine Fuel. Then 10 years later the Port of Los Angeles was found 
again guilty of not-complying with the court order stipulation 
mitigation agreement. We the public also found out that the Port of LA 
forgot to sign a binding contract with China Shipping.
    In 2006 the California public and environmental organization 
supported AB32 the Global Warming Solution Act which became law. The 
law required that California adopt early actions measures to reduce 
greenhouse gases within 5 years. The Coalition For A Safe Environment 
as a member of the Environmental Justice Advisory Committee recommended 
that all major California ports should be required to have electric 
shorepower. The recommendation was adopted by the California Air 
Resources Board and a new ship shorepower regulation was issued in 
2014. Today all California major ports have electric shorepower power. 
However, the majority of all ships are not retrofitted to plug into 
electric shorepower.
    Advanced Cleanup Technologies, Inc. (ACTI) a new emerging small 
minority owned Hispanic business 13 years ago presented their idea for 
a ship and locomotive engine exhaust capture and treatment technology 
to the Port of Los Angeles Board of Harbor Commissioners and Port 
Staff, they laughed at him and said it was an unproven technology.
    ACTI was able to secure several governmental agency grants to build 
a prototype in 2006 to test on locomotives. The Advance Locomotive 
Emissions Contrail System (ALECS) technology was found to be 80%-90% 
effective in capturing and treating locomotive engine exhaust 
emissions. In 2008 the Port of Long Beach gave ACTI permission to 
install and begin testing their Advance Maritime Emissions Contrail 
System (AMECS) technology with a terminal operator on their ships. In 
2014, the City of Long Beach and the California South Coast Air Quality 
Management District give ACTI a contract for a formal demonstration of 
the AMECS technology. The AMECS technology was now 90%-99% effective in 
capturing and treating ship auxiliary engine and boiler exhaust 
emissions.
    On October 17, 2015 AMECS was approved by the California Air 
Resources Board and has been used on over 300 ships. AMECS has even 
been proven to be more cost-effective then electric shorepower. AMECS 
Use existing state-of-the art off-the-shelf proven technologies, does 
not require any modification of a ship, any modification of terminal 
infrastructure, does not require any shorepower & not subject to power 
outages, does not require any additional special permits, can be built 
Stationary On-Dock or Mobile On-Barge and works on any category class 
of ship. As of today not one port in California or Terminal Operator 
has purchased an AMECS system.
    The first two companies in the U.S. to build a Zero Emissions 
Electric Truck have went bankrupt. Balcon built the first electric 
battery Class 8 Drayage Truck and Vision Motor Corp another local Los 
Angeles small business built the first Hydrogen Fuel Cell Battery 
Truck. Yes the Port of Los Angeles has given grants (public money) to 
conduct their first pilot projects with 1-2 trucks but after years of 
developing and improving their technologies, the ports refused to 
purchase more trucks. Vision Motor Corps had two major trucking 
companies willing to purchase 200 and 300 hydrogen fuel cell Tyrano 
trucks but the Port of Los Angeles refused to support them, would not 
recognize or give the trucking companies pollution credits. Ports will 
give grants to test and do pilot demonstrations forever. No Port has 
included Zero Emissions Trucks as mitigation in any EIS/EIR as of 
today. They include a lease agreement statement to conduct a technology 
assessment every five years.
    California and other states have innovative technology companies 
that we need to embrace and invest in before foreign companies steal 
our innovative technology leadership. The US has already lost 99% of 
its merchant ship building base to foreign countries.
                     2. Benefits of Decarbonization
      It is a fact that new technologies support long term 
economic sustainability.
      It is a fact that new technologies significantly reduce 
air pollution.
      It is a fact that new technologies significantly reduce 
greenhouse gas reductions.
      It is a fact that new technologies reduce significantly 
public health impacts.
      It is a fact that new technologies reduce significantly 
reduce public health care costs.
      It is a fact that new technologies support long term 
economic sustainability.
      It is a fact that new technologies reduce premature 
transportation infrastructure.
      It is a fact that new technologies create more new jobs
  3. Status of Zero Emissions On-Road Freight Transportation Vehicles
Trucks
    Ports and the Traditional Diesel Fuel and Natural Gas Freight Truck 
Transportation Industry give the impression that Carbon-Free Zero 
Emission Class 8, Class 7 etc. trucks are not available, which is not 
true. The Coalition For A Safe Environment publishes almost monthly a 
Zero Emission Transportation Vehicles, Cargo Handling Equipment & 
Construction Equipment Commercial Availability Survey. Here are a few 
facts:

------------------------------------------------------------------------
                                      Currently Available For Purchase/
                                              One Year Delivery
------------------------------------------------------------------------
Electric Trucks Class 8............                                  11
Electric Class 7 Truck.............                                   1
Electric Trucks Class 6............                                   6
Electric Trucks Class 5............                                   2
Electric Trucks Class 4............                                   1
Electric Trucks Class 3............                                   2
------------------------------------------------------------------------

    It is a fact that all Class 8 Zero Emission Trucks can meet the 
demand for all short hauls of less than 100 miles. The Ports refuse to 
include these trucks for mitigation for all projects, terminals, 
railyards, intermodal facilities that have short haul requirements.
Trains
    Ports and the Traditional Diesel Fuel and Natural Gas Freight Train 
Transportation Industry give the impression that Carbon-Free Zero 
Emission Trains are not available, which is not true. The Coalition For 
A Safe Environment publishes almost monthly a Zero Emission 
Transportation Vehicles, Cargo Handling Equipment & Construction 
Equipment Commercial Availability Survey. Here are a few facts:

------------------------------------------------------------------------
                                      Currently Available For Purchase/
                                              One Year Delivery
------------------------------------------------------------------------
Electric Trains....................                                  22
------------------------------------------------------------------------

    The Port of Rotterdam has been using electric trains exclusively 
for over 50 years in Europe. There are over 5 countries that are using 
electric freight trains.
     4. Status of Zero Emissions Off-Road Cargo Handling Equipment
Trucks
    Ports and the Traditional Diesel Fuel and Natural Gas Freight Truck 
Transportation Industry give the impression that Carbon-Free Zero 
Emission Class 8, Class 7 etc. trucks are not available, which is not 
true. The Coalition For A Safe Environment publishes almost monthly a 
Zero Emission Transportation Vehicles, Cargo Handling Equipment & 
Construction Equipment Commercial Availability Survey. Here are a few 
facts:

------------------------------------------------------------------------
                                      Currently Available For Purchase/
                                              One Year Delivery
------------------------------------------------------------------------
Electric Yard Tractors Class 8.....                                  10
Electric Class 7 Truck.............                                   1
------------------------------------------------------------------------

    It is a fact that all Class 8 and Class 7 Zero Emission Trucks can 
meet the demand for all short hauls of less than 100 miles. The Ports 
refuse to include these trucks for mitigation for all projects, 
terminals, railyards, intermodal facilities that have short haul 
requirements.
Cranes
    Ports and the Traditional Diesel Fuel and Natural Gas Cargo 
Handling Industry give the impression that Carbon-Free Zero Emission 
vehicle and equipment are not available, which is not true. The 
Coalition For A Safe Environment publishes almost monthly a Zero 
Emission Transportation Vehicles, Cargo Handling Equipment & 
Construction Equipment Commercial Availability Survey. Here are a few 
facts:

------------------------------------------------------------------------
                                      Currently Available For Purchase/
                                              One Year Delivery
------------------------------------------------------------------------
Electric Ship-to-Shore (STS) Rail-                                    3
 Mounted Gantry Cranes.............
Electric Rubber-Tired Gantry (RTG)                                    6
 Cranes............................
Electric Rail-Mounted Gantry Cranes                                   1
Electric Bulk Handling Crane.......                                   1
Carry Deck Crane...................                                   2
Reach Stackers.....................                                   7
Shuttle Carrier....................                                   1
Straddle Carrier...................                                   4
Trailer Spreader...................                                   1
Electric Forklifts.................                                 109
Electric Pallet Truck..............                                   1
Top Front End Payloader............                                   1
------------------------------------------------------------------------

    It is a fact that that almost every manufacturer will build zero 
emission Cargo Handling Equipment if a customer requests it.
      5. Status of Ship Emissions Capture & Treatment Technologies
    Ports and the Traditional Shipping Industry give the impression 
that there are no ship emissions capture and treatment technologies 
available, which is not true. Here are a few facts:

------------------------------------------------------------------------
                                      Currently Available For Purchase/
                                              One Year Delivery
------------------------------------------------------------------------
Ship Emissions Capture & Treatment                                    2
 Technologies......................
------------------------------------------------------------------------

    Only one company can accommodate all ship classes and categories. 
ACTI which is now Advanced Environmental Group, LLC (AEG).
               6. Status of Zero Emission Ships & Barges
    As of today there are no Zero Emission Freight Transport Ships, 
however, in 2012 Nippon Yusen launched the first partially 10% solar 
powered RoRo Ship the Auriga which visited the Port of Long Beach.
    The nation's first hydrogen fuel cell electric powered Zero 
Emission Passenger Ferry is now operating in San Francisco Bay and in 
2012 the largest Swiss designed solar 50 passenger ship the Turanor 
PlanetSolar completed an 18 month global world trip.
    In 2018 the Ports of Rotterdam, Antwerp and Amsterdam became the 
first in the world to begin using Zero Emission Barges. The Dutch 
manufacturer Port Liner built the five Carbon-Free Barges which have no 
engine rooms which allowed 8% more cargo to be carried.
    We believe that hydrogen fuel cell electric power is the current 
available clean sustainable technology to invest in that will meet the 
need of carbon-free ship freight transportation.
           7. Status of Zero Emissions Construction Equipment
    Ports and the Traditional Diesel Fuel and Natural Gas Cargo 
Construction Industry give the impression that Carbon-Free Zero 
Emission construction vehicles and equipment are not available, which 
is not true. The Coalition For A Safe Environment publishes almost 
monthly a Zero Emission Transportation Vehicles, Cargo Handling 
Equipment & Construction Equipment Commercial Availability Survey. Here 
are a few facts:

------------------------------------------------------------------------
                                      Currently Available For Purchase/
                                              One Year Delivery
------------------------------------------------------------------------
Electric Dredgers..................                                   5
Tracked Dozer (Tractor)............                                   1
Excavators.........................                                   4
Top Front End Payloader............                                   1
Wheeled Loader.....................                                   5
Rope Shovels.......................                                   3
Wheel Dumper.......................                                   1
Concrete Mixers....................                                   1
Dump Trucks........................                                   4
Delivery Truck.....................                                   8
Cab Chassis Delivery Truck.........                                   8
Flat Bed Truck.....................                                   3
Cargo Panel Van....................                                  11
Electric Pickup Trucks.............                                   7
Utility/Electric Trucks............                                   3
Aerial Boom Trucks.................                                   4
Compact Utility Vehicles...........                                  22
------------------------------------------------------------------------

  7. International Maritime Organization Standards--MARPOL Annex 6, 13
    Currently requires the worldwide transition into low-sulfur marine 
fuels.
    Currently requires that all ships entering the U.S. West Coast 
Emission Control Area (ECA) must comply with NOX, SOX and PM emissions 
requirements.
    Currently requires that all ships entering the U.S. West Coast ECA 
built after January 1, 2016 must have cleaner Tier 3 Engines.
    8. Current & Past Port Freight Transportation, Infrastructure & 
                     Mitigation Funding Mechanisms
    California has been the national leader in introducing innovative 
funding mechanism to support investment in freight transportation and 
infrastructure.
    In 1998 the Carl Moyer Memorial Air Quality Standards Attainment 
Program (Moyer Program or Program) has cost-effectively reduced smog-
forming and toxic emissions. The Carl Moyer Program is implemented as a 
partnership between the California Air Resources Board (CARB) and 
California's 35 local air districts. CARB works collaboratively with 
the air districts and other stakeholders to set Guidelines and ensure 
the Program reduces pollution and provides cleaner air for 
Californians. Approximately $1 billion has been allocated to date and 
the Program continues to provide over $60 million in grant funding each 
year to clean up older polluting engines throughout California.
    The 2001 China Shipping San Pedro Homeowners environmental lawsuit 
settlement with the Port of Los Angeles also included an extra 
Mitigation Fund Container Fee of $ 30 per TEU if the China Shipping 
Terminal exceeded the 328,000 EIS/EIR TEU's cap per calendar year. The 
China Shipping Terminal did exceed the EIS/EIR cap and generated $ 10 
million.
    In 2005 the Pier Pass Traffic Mitigation Fee (TMF) was established 
at the Ports of Los Angeles and Long Beach as an incentive to shift 
some container movement to night hours vs day hours to relieve traffic 
congestion and truck idling which causing significant air pollution in 
harbor communities. A flat fee for daytime container moves at the Ports 
of Los Angeles and Long Beach during peak day time hours. The Tariff 
was $31.52 per TEU and $ 63.04 for all other TEU Sizes. The TMF reached 
high of $ 72.09 TEU in 2018. PierPass was in response to a stern 
warning from the California Legislature in 2003 to either mitigate 
port-caused traffic congestion in Los Angeles-Long Beach or the 
legislature would impose a solution.
    In 2006 Proposition 1B the Highway Safety, Traffic Reduction, Air 
Quality, and Port Security Bond Act of 2006, is approved by California 
voters and authorizes the Legislature to appropriate $1 billion in bond 
funding to the California Air Resources Board to reduce air pollution 
emissions and health risks from freight movement along California's 
priority trade corridors. Approximately $200 million is allocated every 
year.
    In 2006 the California Air Resources Board approves the Cap & Trade 
Program under Assembly Bill (AB) 32 the Global Warming Solutions Act of 
2006 which allows the purchasing of air pollution credits to mitigate 
greenhouse gas environment impacts. Over $ 12 billion has been raised 
since 2012 by California and over $ 250 million annually allocated for 
public and freight transportation. Funds support zero emission, near 
zero emission, emission capture & treatment technologies and energy 
efficiency programs.
    In 2007 the Ports of Los Angeles and Long Beach establish a Clean 
Truck Fund as part of the newly adopted Clean Air Action Plan. A tariff 
of $ 35 per TEU would be assessed on every loaded container entering or 
leaving the Ports by drayage truck beginning June 1, 2008.
    In 2007 environmental organizations, homeowner associations and 
residents opposed the Port of Los Angeles TraPac Container Terminal 
Expansion Project for failing to adequately mitigation all community 
impacts. The threat of another public environmental lawsuit forced the 
Port of Los Angeles into a pre-court settlement. The settlement MOU 
included a Mitigation Fund Container Fee of $ 3.50 per TEU, $1.50 PX or 
0.15 Per Ton of Cargo for the projected 1,497,142 EIS/EIR TEU's cap per 
calendar year.
    In 2011 the California Air Resources Board approves the Cap & Trade 
Program under AB 32 the Global Warming Solutions Act of 2006 which 
allows the sales and purchasing of air pollution credits to mitigate 
greenhouse gas environment impacts. Over $ 12 billion has been raised 
since 2012 by California and over $ 250 million annually allocated for 
public and freight transportation. Funds support zero emission, near 
zero emission, emission capture & treatment technologies and energy 
efficiency programs.
    In 2015 Senate Bill (SB) 513 was approved providing new 
opportunities for the Program to contribute significant emission 
reductions alongside implemented regulations, advance zero and near-
zero technologies, and combine program funds with those of other 
incentive programs.
    In 2017 AB 617 Nonvehicular Air Pollution: Criteria Air Pollutants 
and Toxic Air Contaminants is approved requiring the reduction of 
emissions of toxic air contaminants and criteria pollutants in 
communities affected by a high cumulative exposure burden. Over $ 245 
million is allocated annually for mitigating mobile sources and 
stationary sources.
Sample Federal Grant Funding Programs:
    U.S. Dept. of Energy--The Vehicle Technologies Office (VTO) 
supports high impact projects that can significantly advance its 
mission to develop more energy efficient and environmentally friendly 
highway transportation technologies that enable America to use less 
petroleum.
    U.S. Dept. of Transportation--Fixing America's Surface 
Transportation Act or FAST Act--Fostering Advancements in Shipping and 
Transportation for the Long-term Achievement of National Efficiencies, 
or FASTLANE, grant program.
                          9. Homeland Security
    No dependence on fossil fuels using Electric Battery and Hydrogen 
Fuel Cell Power Zero Emission Technologies.
    In conclusion, we can provide detailed information, studies and 
reports on all available zero emissions and emissions capture and 
treatment technologies. We can also provide introductions to many of 
the new emerging technology companies.
        Respectfully Submitted,
                                          Jesse N. Marquez,
              Executive Director, Coalition For A Safe Environment.



                                Appendix

                              ----------                              


   Questions from Hon. Peter A. DeFazio to Joshua Berger, Governor's 
     Maritime Sector Lead, Washington State Department of Commerce

    Question 1. Reports of emerging environmental, climate, and health 
impacts of black carbon produced by current ``alternative'' fuels like 
LNG indicate that the full transition away from LNG-powered 
transportation may be a critical step to ensure a livable future on 
earth. What are the necessary steps to transition our marine 
transportation system toward 100 percent clean energy sources?
    Answer. It is well established within the maritime transportation 
industry and its supply chain that LNG is a growing ``transition'' fuel 
seeking to bridge the gap from today's typical emission profile towards 
a 100% clean energy, zero-emission future. Investments are being made 
in order to meet current international regulations and significantly 
limit other emissions like NOx, SOx and diesel particulate matter, 
particularly in disproportionately low-income communities of color. 
However, it is also accepted that this is not a long-term solution to 
get to zero-emissions and many believe that investing in the 
infrastructure necessary for LNG will prolong the necessary investment 
in R&D and solutions for a 100% clean energy future.
    In my opinion, the steps necessary to get towards a 100% clean 
energy future and zero-emission transportation include:
      Establish and invest in current infrastructure known to 
support zero-emission fuels. For example, developing an electrical grid 
that can support the types of loads necessary to electrify inland and 
short sea shipping as well as cold ironing for deep-sea vessels, cruise 
ships, etc. This would include ways to produce zero-emission fuels in 
the future like hydrogen and/or ammonia fuel cells and a distinct look 
at how existing infrastructure can support future alternatives. These 
infrastructure investments would need to look systemically along the 
working waterfront and be part of a deliberate and strategic approach 
to decarbonization.
      Invest in a coordinated approach to R&D and 
commercialization of zero-emission solutions within the federal 
enterprise. There is a nascent but effective group being led by the US 
Department of Energy to coordinate with other relevant agencies, 
departments and offices where R&D is underway seeking to address 
alignment and support of industry's direction. The Blue Economy spans 
across many federal agency interests and areas of responsibility. If 
there is a centralized place, or group that could facilitate federal 
investment and strategy for R&D this would drastically scale our 
effectiveness and ability to find solutions. One example being 
discussed is the revival of the National Oceanographic Partnership 
Program (NOPP) \1\ which could be resourced and expanded to include the 
breadth of the Blue Economy, including maritime transportation.
---------------------------------------------------------------------------
    \1\ National Oceanographic Partnership Program, https://
www.nopp.org/
---------------------------------------------------------------------------
      Empower the US maritime industry by leading the global 
maritime community at the IMO, UN and other intergovernmental forums. 
For example, the proposal put forward by the World Shipping Council and 
several other industry associations to establish an IMO backed R&D fund 
would be a significant step towards what is needed on a global scale to 
find zero-emission solutions and the infrastructure needs to support 
them \2\. The US has an important voice at the IMO and could 
increasingly engage the global maritime and ocean economy at the UN 
level to be part of the solution. This would send a leadership signal 
to the US maritime industry that we are engaged and want to lead the 
work in this major maritime transformation underway. So far, we are not 
leading this effort and are lagging behind both Europe and Asia.
---------------------------------------------------------------------------
    \2\ World Shipping Council Proposal to IMO-MPEC for R&D Fund, 
http://www.worldshipping.org/public-statements/regulatory-comments/
MEPC_75-7-4_-_Proposal_
to_establish_anInternational_Maritime_Research_and_Development_Board_-
IMRB-_-ICS_BIMCO_CLIA_INTERCA...-_18_Dec_2019.pdf
---------------------------------------------------------------------------
      Support the efforts of regional innovation clusters. At a 
local scale, the maritime and ocean supply chain of operators, 
technology developers, and designers are engaging with state and local 
governments, research institutions, entrepreneurs, investors and 
community groups to accelerate innovation. These formal organizations 
are drawing participation and collaboration to manage successful 
demonstration projects, deploy private and public capital, and develop 
new technology. All other world-class maritime regions are investing in 
these ``innovation ecosystem builders'' to lead these efforts. Norway, 
France, Portugal, England, Singapore, Dubai, and others have a national 
system of innovation clusters supported, at least in part, by 
government. Just now the US is starting to recognize the role of these 
cluster organizations, incubators and accelerators. The recent Build to 
Scale Notice of Funding Opportunity (NOFO), a partnership between the 
Economic Development Administration and the Department of Energy, to 
support the Blue Economy is a tremendous start \3\. We would hope this 
would be an ongoing commitment to supporting the underlying operational 
needs of this activity.
---------------------------------------------------------------------------
    \3\ US Commerce Economic Development Administration FY2021 Build to 
Scale Funding Opportunity, https://www.grants.gov/web/grants/view-
opportunity.html?oppId=324375

    Question 2. What strategies is Washington state using to reach its 
zero-emission by 2030 goal? Please send a list of the technologies 
being deployed across the fleet.
    Answer. Washington state owns and operates the largest ferry system 
in the United States and is committed to convert the entire fleet of 25 
vessels and 20 terminals to electric and hybrid-electric operations by 
2040 \4\. We are starting with the conversion of our largest vessels 
and starting a 5-vessel newbuild program of another class. The 
conversion of our largest vessels and largest polluters is from diesel 
electric to diesel/battery hybrid. These are 200 + vehicle ferries 
designed to run at 90% zero-emission with the appropriate charging 
infrastructure at the terminals. Washington State Ferries also use a 
B20 blend of biodiesel.
---------------------------------------------------------------------------
    \4\ Washington State Ferries 2040 Long Range Plan, https://
www.wsdot.wa.gov/sites/default/files/2019/01/07/WSF-2040-Long-Range-
Plan-2019.pdf
---------------------------------------------------------------------------
    Other public (local municipality transit and ferry districts) and 
private operators of ferries are utilizing both hybrid-electric systems 
and designing all-electric systems, with both battery and fuel cell 
technology being explored. Electric and hybrid solutions are 
competitive for ferry, short sea and inland vessel operations where 
charging infrastructure can be deployed to support operations.
    Washington state is also investing in electrification of cargo 
terminals at our major gateways through the state's VW mitigation 
settlement. A portion of these funds, along with state capital dollars, 
are being used to support port investments to provide cold ironing at 
container and cruise terminals. As well, the state administers the 
Clean Energy Fund, a competitive grant program for electrification of 
transportation, including for maritime applications.
    Other fuel technologies I am aware of that are being researched or 
developed throughout the private commercial fleet in Washington 
include: biodiesel, biogas, LNG, LNG/battery hybrid, hydrogen fuel 
cell, hydrogen injection w/diesel, and ammonia fuel cell.
    Washington based design, architecture and construction firms are 
developing more efficient hull designs and materials to increase 
efficiency for alternative, zero-emission options like foiling for high 
speed passenger ferries.
    Washington has also become a center for battery/energy storage 
design and development both for on-board as well as supporting 
shoreside charging. There are new marine specific battery companies in 
Washington state. One is working on commercializing a solid-state 
lithium ion battery to be completely manufactured in the US. Others are 
bringing new technologies, chemistries, cooling and management systems 
as the market for marine batteries continues to exponentially grow.

    Question 3. What work has the Washington Maritime Blue cluster done 
to operationalize alternative fuels and energy sources with the 
smallest greenhouse gas emission impact?
    Answer. As an independent non-profit, cluster organization, 
Washington Maritime Blue operates on a number of levels to support 
alternative fuels and zero-emission solutions to meet the State's 
strategy goals for deep-decarbonization. They include:
      Marketing and communications for our members and the 
growing center of excellence in our region, particularly around 
electrification.
      Knowledge sharing events, called Blue Forums, that bring 
together hundreds of stakeholders on key topics such as maritime energy 
solutions, digitalization, battery safety, etc.
      Managing Joint Innovation Projects to achieve 
demonstration and/or commercialization of new technology and 
collaborative R&D. For Example; managing members and funding mechanisms 
to design, construct and support operations of a zero-emission fast 
foil ferry for Puget Sound passenger service.
      Administer a partnership between service providers, 
educational institutions, and employers to make maritime an accessible 
option for low-income youth and youth of color to create a 21st century 
maritime workforce.
      Attract various forms of investment and funding to 
demonstration projects and entrepreneurs working on solutions for the 
blue economy and decarbonization of maritime transportation.
      Develop and manage a Blue Innovation Accelerator for 
young companies working on solutions to achieve our state's Strategy 
for the Blue Economy and building a Maritime Innovation Center to be a 
hub for our region's growth as a center of excellence.

    Question 4. How have you collaborated with shore infrastructure 
operators (i.e., ports, marine terminals, fuel suppliers) to source 
fuels? What challenges arose, and what federal support can enable 
further successful implementation?
    Answer. Incorporating technology and infrastructure development on 
shore is key to successful deployment of technology on board vessels as 
well as the ability to reduce impact of vessels at berth and shoreside 
operations. A number of projects are underway to further implement:
      Washington State Department of Ecology is administering a 
grant program utilizing VW Settlement dollars, a portion of which is 
slated for marine terminal electrification adding cold ironing capacity 
as well as terminal equipment.
      Washington State Department of Commerce is working with a 
major bio/renewable fuel producer to expand operations and production 
in the state for both aviation and marine fuels.
      Washington Maritime Blue is leading a team in a grant 
application to bring renewable hydrogen production to a major port in 
Washington that would be used for marine/maritime applications 
including terminal equipment and local rail.
      Washington Maritime Blue is supporting technology 
supplier input to standardization of charging technology for ferry 
operations.
      Washington Maritime Blue is working with several digital/
tech companies and terminal operators to increase efficiency for 
terminal movements, drayage, and just in-time arrivals seeking to 
decarbonize up to 30% through efficiencies, tracking and incentives 
alone.
      Washington Maritime Blue is working with a team to 
produce a decarbonization strategy for Seattle's working waterfront 
along with the Port of Seattle, Seattle City Light (the utility), 
terminal operators, owners and tenants.

    One of the largest challenges that has arisen for us working to 
develop shore-side infrastructure is how to best engage with the 
utility. They are often supportive but either the technology or rate-
based systems that are in place seemingly limit the economic viability 
of large electrification projects. However, we have found that working 
collectively we can find ways to make the economics work to look for 
solutions like micro-grid technology, new rate systems, energy storage 
and renewable energy production. With the leadership of Governor 
Inslee, we now have new Clean Energy Transition policies passed in 2019 
that incentivize the public and private utilities to transition to 
renewables and gain credits for supporting electrification of 
transportation systems. Finding federal mechanism to incentivize 
utilities to modernize and account for the large increase of 
electrification in all sectors will be essential to scale these types 
of projects.
    Another challenge is the ability to permit and complete large 
industrial projects. Not only are there challenges protecting maritime 
industrial lands in a fast-growing region, but gaining social license 
for industrial projects, even if the end use is to reduce/eliminate 
emissions. Many of these are state, local and stakeholder issues--
however there has been a lack of consistency and predictability when it 
comes to federal permitting of infrastructure projects. For example, 
there is still no clear standard accounting for greenhouse gasses in 
NEPA nor is there consistency or clear federal to state standards for 
the 401/404 water quality permit from the application process to 
decision making. This makes it very challenging for developers and 
operators who work with very small margins to weigh the cost/benefit of 
approaching large scale projects, especially those along the 
waterfront. Washington state is proud of our high environmental 
standards, we believe these are not unsurmountable. However, it is 
critical that permitting and regulatory bodies provide consistency and 
predictability for developers to plan the very large capital 
investments necessary to decarbonize maritime transportation and power 
a clean economy.
    Additionally, as stated above, having R&D and infrastructure 
dollars that are distinctly available for maritime energy solutions and 
coordinated across multiple federal agencies and departments is 
critical. Many of these solutions are ready to plan and build, some 
need further testing to scale. There are some examples that can be used 
as models, including the Department of Energy's H2@Scale grant program 
\5\ where maritime applications are a specific category. Other areas 
could be adding maritime decarbonization criteria to BUILD grants and 
other port and infrastructure funding mechanisms through US DOT and 
MARAD.
---------------------------------------------------------------------------
    \5\ US Department of Energy H2@Scale Program, https://
www.energy.gov/eere/fuelcells/h2scale

    Question 5. What would it take to advance the US position in the 
clean maritime industry and totally decarbonize our maritime sector?
    Answer. Many of the steps necessary to decarbonize the maritime 
sector are outlined above. That there will not likely be a single 
solution makes it challenging to fully account. However, global 
estimates put the scale of investment at $1 trillion \6\. If the US was 
able to commit and dedicate a certain amount of relative investment 
with coordinated leadership our position would be significantly 
advanced. Much like the role of a cluster organization for a local or 
regional maritime cluster the US would need a central organizing and 
coordinating office to bridge and leverage the appropriate agencies 
across the federal enterprise. Again, the NOPP is already set up to 
handle that sort of role if resourced and directed appropriately.
---------------------------------------------------------------------------
    \6\ UMAS/Energy Transitions Commission study for the Global 
Maritime Forum: Getting to Zero Coalition, https://
www.globalmaritimeforum.org/press/new-analysis-puts-a-price-tag-on-
maritime-shippings-decarbonization

    Question 6. The International Council on Clean Transportation 
reports that over 59,000 people died from effects of shipping emissions 
in 2015, and the ongoing effects of port activity on local 
communities--disproportionately low-income communities of color--
include asthma and other chronic illnesses. What steps has the Office 
of Maritime taken to mitigate these impacts?
    Answer. Addressing the disproportionality of affected communities 
by climate impacts is a top priority for Governor Inslee and is part of 
the criteria for decision making in all appropriate state agencies. 
Related to maritime transportation:
      The Washington State Department of Ecology has set 
criteria to prioritize electrification projects that receive funding 
with dollars from the VW settlement account. The process looks at NOx, 
SOx and diesel particulate matter reductions in relation to 
economically stressed census tracts. This heavily weights 
electrification projects in and around port industrial areas due to 
heavy emissions from shipping and vessel activity. ``Using data from 
the Washington Tracking Network's `Diesel Pollution and 
Disproportionate Impact', we identified communities that have 
historically borne a disproportionate share of the diesel air pollution 
burden. These priority communities have high-traffic transportation 
corridors and urban population centers, ports, and industrial 
facilities that can be sources of diesel air pollution, so they provide 
the greatest opportunity for Washington to achieve its mitigation plan 
principles and priorities'' \7\.
---------------------------------------------------------------------------
    \7\ Washington State Department of Ecology VW Federal Enforcement 
Action, https://ecology.wa.gov/Air-Climate/Air-quality/Vehicle-
emissions/Volkswagen-enforcement-action/VW-federal-enforcement-action
---------------------------------------------------------------------------
      The Washington State Department of Commerce-Energy 
Division, manages the state's Clean Energy Fund which competitively 
awards clean energy projects in various sectors and programs. The 
recently released Electrification of Transportation Systems Program \8\ 
heavily weights projects that reduce impacts in disproportionality 
affected communities using the same health disparity data referenced 
above.
---------------------------------------------------------------------------
    \8\ Washington State Department of Commerce's Electrification of 
Transportation Systems Program, https://www.commerce.wa.gov/growing-
the-economy/energy/clean-energy-fund/electrification-of-transportation/
---------------------------------------------------------------------------

   Question from Hon. Anthony G. Brown to Joshua Berger, Governor's 
     Maritime Sector Lead, Washington State Department of Commerce

    Question 1. In your opinion, what policy actions can Congress take 
to ensure that the Department of Defense's investment in blue carbon 
capture technology is accessible and leveraged by the commercial 
maritime industry?
    Answer. It has been, and will continue to be, a critical connection 
between the nation's Department of Defense and commercial-industrial 
sectors in order to leverage investments in projects like blue carbon 
capture, and others. As well, we need to insure there continues to be 
effective mechanisms to leverage innovation in the commercial sector to 
support the needs of DOD--like the Small Business Innovation Research 
(SBIR) program and others.
    Washington State's military and defense sector is a critical 
component to our state's economy. ``As the second largest public 
employer in Washington employing more than 127,000 active duty, 
reserve, guard and civilian personnel, home to over 540,000 veterans 
including 71,000 retirees and 88,674 military families; Washington's 
military and defense community supports over $13 billion dollars in 
annual procurement supported by nearly 2,000 businesses across the 
state, representing nearly 3% of the state's GDP'' \9\. This impact is 
closely linked to our maritime sector in particular due to the Puget 
Sound Naval Shipyard, the Naval Base Everett, the Naval Submarine Base 
Bangor, and the Naval Undersea Warfare Center Division Keyport. A Navy 
program that was created to support technology transfer and we are 
working directly with is NavalX-NW Tech Bridge.
---------------------------------------------------------------------------
    \9\ Washington State Department of Commerce Industry Sector 
Development Program, https://www.commerce.wa.gov/growing-the-economy/
key-sectors/military-defense/
---------------------------------------------------------------------------
    ``Northwest (NW) Tech Bridge was the result of an alignment of many 
factors. As the Department of the Navy identified its need to develop 
new technology and partnerships at scale, the Washington State 
Manufacturing Extension Partnership (MEP), Impact, simultaneously 
engaged with a group of stakeholders from the Washington State maritime 
sector, industry and academia to increase capabilities of the 
Washington maritime industry. These initiatives, coupled with 
Washington's multi-million dollar investment in local innovation 
centers, culminated in very fertile ground for collaboration on 
national Navy challenges.
    Our NW Tech Bridge will identify a low-barrier off-base facility to 
support rapid collaboration, workshops, and problem-solving events 
nearby in Kitsap County. Naval Undersea Warfare Center Keyport is 
working on a contractual agreement that will allow for day-to-day 
collaboration on problems with industry and academia in a physical 
collision space. Extensive academic and industry collaboration already 
occurs within the state with our top tier research and training 
institutions such as Washington State University (WSU), University of 
Washington (UW) and UW Tacoma, Western Washington University, and 
Olympic College. Leveraging these relationships are critical to the 
success of NW Tech Bridge and the Navy'' \10\.
---------------------------------------------------------------------------
    \10\ NavalX-NW Tech Bridge, https://www.secnav.navy.mil/agility/
Pages/tb_northwest.aspx
---------------------------------------------------------------------------

 Questions from Hon. Peter A. DeFazio to John W. Butler, President and 
            Chief Executive Officer, World Shipping Council

    Question 1. Reports of emerging environmental, climate, and health 
impacts of black carbon produced by current ``alternative'' fuels like 
LNG indicate that the full transition away from LNG-powered 
transportation may be a critical step to ensure a livable future on 
earth. What are the necessary steps to transition our marine 
transportation system toward 100 percent clean energy sources?
    Answer. To transition the maritime transportation system to clean 
energy sources requires an intensive and dedicated research and 
development effort that is specifically focused on evaluating what 
combination of clean fuels and technologies are feasible for 
application in the commercial maritime sector. While tremendous strides 
have been made in the development of low carbon and zero emission 
technologies in the on-road sector, the level of research, development, 
and related activities devoted to developing zero-emission fuels and 
technologies designed for use in the commercial maritime sector is very 
limited with many projects focused on small ferries and other vessels 
with modest power requirements.
    Recognizing this challenge, the World Shipping Council (``WSC'' or 
``the Council''), together with a number of other maritime industry 
organizations, has submitted a detailed proposal to the International 
Maritime Organization (IMO) that calls for establishment of an 
International Maritime Research and Development Board (IMRB) whose 
purpose would be to undertake the necessary research to develop and 
introduce zero-emission ships (including systems appropriate for large 
transoceanic ships) as soon as possible. The proposal also includes a 
legally binding funding mechanism that would generate roughly 5 billion 
USD from ocean carriers over a ten-year period. WSC believes this 
action is a critical step in developing the technical pathways for the 
introduction of low-carbon and zero-emission ships. The proposal 
submitted to the IMO is included in my written testimony provided in 
advance of the January 14 hearing.

    Question 2. What strategies is the Council using to reach the IMO 
emission reduction targets? Please send a list of the technologies 
being deployed across the fleet.
    Answer. WSC and its members are working with a large number of 
governments, the IMO Secretariat, environmental organizations, and 
other interested parties to gather support for the proposed IMRB 
(discussed in Item 1) as well as other measures currently under 
development at the IMO. A short indicative list of technologies 
currently being used to significantly reduce emissions of sulphur, NOx, 
PM, CO2, black carbon, and other air emissions include:
      Use of low-sulphur fuels (both within Emission Control 
Areas and on a global scale);
      Use of exhaust gas cleaning systems (EGCS);
      The introduction of new, more fuel-efficient ship designs 
that have led to significant improvements in the fuel efficiency of 
container ships and vehicle carriers with many of the larger container 
ships improving their design efficiency in excess of 45%;
      Trials in the use of biofuels in a number of ships; and
      The conversion of many container ships to utilize shore-
side power in California and other locations where connections are 
available.

    Question 3. What alternative fuels and energy sources will have the 
smallest greenhouse gas emission impact? What work have your members 
done to operationalize the use of those fuels?
    Answer. Notable uncertainty still surrounds the question of what 
fuels offer the greatest potential to reach near-zero carbon emissions 
in the commercial maritime sector, but ammonia and hydrogen are two of 
the more promising fuels, if produced using renewable energy such as 
solar. Some small-scale demonstrations of hydrogen and battery 
applications have been undertaken on small vessels with very limited 
power requirements. The greatest technical challenges lie with 
identifying what fuels and technology systems may prove feasible for 
large transoceanic ships that have very large power demands (e.g., 
engine power capabilities of 30,000-80,000 kW) and need to sail 
distances measured in thousands of miles between refueling.
    The proposal to establish an IMRB is designed to devote 
considerable effort not only in exploring the different fuel and 
technology configurations necessary that can be applied in the maritime 
fleet (including large transoceanic ships), but to develop and test 
shipboard prototypes and to explore shore-to-ship fuel infrastructure 
protypes for the most promising fuels and technology systems.
    To operationalize the use of these fuels requires intensive 
technical research and development work and prototype development. This 
type of work exceeds the capability of any single company or probably 
any single government. Consequently, WSC and other industry 
organizations have worked for roughly two years to develop the IMRB 
proposal to the IMO.

    Question 4. How has the industry collaborated with shore 
infrastructure operators (i.e., ports, marine terminals, fuel 
suppliers) to source fuels? What challenges arose, and what government 
support enabled successful implementation?
    Answer. Experience in this area to date is largely relevant to use 
of LNG and the use of shore-side auxiliary power in California ports. 
In the case of LNG use, WSC member companies have developed direct fuel 
supplier relationships in specific ports where specialized arrangements 
have been made for delivery of LNG to ships (often truck-to-ship 
transfers). The support of the U.S. Coast Guard and local port 
authorities has been critical to establish the necessary protocols and 
standards to ensure safe handling of the fuel.
    In the case of shore-side auxiliary power, the overwhelming 
majority of experience falls in California where fleet requirements 
apply to container ship operators visiting California ports. The 
introduction of shore-side electrical infrastructure with adequate 
connection vaults is an extremely challenging, costly, and complicated 
undertaking. California has provided a test case for the numerous 
technical and regulatory challenges that accompany such rules and the 
California Air Resources Board (CARB) is currently considering a series 
of major amendments (including expansion of the program to other ship 
types) to the existing California at-berth power requirements.
    WSC has been working closely with CARB as they move forward with 
these amendments and we believe the revised regulations should produce 
better results as legal obligations are proposed to be established for 
terminals and ports to provide the necessary infrastructure and to 
ensure connections are made to visiting vessels in a timely manner. Any 
state or locality considering shore-side power requirements should 
carefully study the experience and lessons learned in California.

    Question 5. What would it take to comprehensively and sustainably 
advance the US position in the clean maritime industry and totally 
decarbonize our maritime sector?
    Answer. Totally decarbonizing the commercial maritime sector will 
require the development of zero-carbon fuels and technology systems 
specifically designed for the unique requirements of large transoceanic 
ships and a broad array of ship types with specific operational 
demands. This will require an intensive examination of fuel density 
characteristics, materials science, the potential for green production, 
and the development of specific systems that meet the demands of ships 
that transit long distances before refueling. We believe that the 
proposed establishment of an IMRB is critical to achieving this 
objective (see also the response to question 1).

    Question 6. Shore power technology has the potential to virtually 
eliminate greenhouse gas emissions from maritime vessels while at 
berth, put upfront capital expenditure has deterred operators from 
investing in such infrastructure.
    Comment from Mr. Butler. It should be noted that shore power 
technology only eliminates GHG emissions for ships at berth if the 
electricity supplied is itself ``green power.'' If the power plant 
generating the electricity is producing GHG emissions, emissions are in 
most cases reduced (depending on the fuel used), but not eliminated. 
The most significant air quality benefits of shore power are generally 
associated with the reduction of NOx and PM in the port area, and these 
emissions are the primary reasons that shore power has been pursued in 
California.
    a. What sorts of incentives and supports could help promote at-
berth electrification for your members' vessels?
    Answer. While retrofitting and equipping ships with shore power 
capability is expensive, the most complicated and expensive investments 
involve the provision of electrical infrastructure in the port and 
terminals. This requires extensive consideration of what the most 
efficient and cost-effective design is for electrical sub-stations 
throughout the port as well as the location and construction of 
electrical vaults that will enable visiting ships to connect as 
planned.
    For some ship types, such as transoceanic vehicle carriers that 
visit a given port on a very infrequent basis (e.g., some vehicle 
carriers may visit a given port once or twice in a two to three year 
period), a system that uses shore-based emission capture technology 
instead of shore-based electrical connections may prove more practical 
and cost effective as an emission reduction strategy.
    b. What sorts of collaboration and coordination are necessary to 
ensure international operators can plug in to an electric grid here and 
abroad? What are the advantages of that approach?
    Answer. Years of experience in California has demonstrated that an 
effective at-berth emission program (whether that is electrification or 
emission capture) requires extensive shore-side planning and 
coordination between the port authority, terminals, ship operators, and 
regulatory authorities. The experience in California has also 
demonstrated that an effective at-berth program requires that 
definitive obligations be placed on shore-side entities and not only on 
visiting ships. Failure to do so can result in a situation where shore-
power equipped vessels are unable to connect to shore-side power due to 
inadequate shore-side infrastructure and insufficient incentives or 
requirements to ensure timely connection of the vessel. Any program 
also needs to ensure that the relevant electrical power and connection 
requirements are fully consistent with international standards.

    Question 7. The International Council on Clean Transportation 
reports that over 59,000 people died from effects of shipping emissions 
in 2015, and the ongoing effects of port activity on local 
communities--disproportionately low-income communities of color--
include asthma and other chronic illnesses. What steps has the Office 
of Maritime taken to mitigate these impacts?
    Answer. To effectively mitigate these impacts, port authorities and 
relevant regulatory bodies need to consider a suite of actions that 
look at the overall movement of goods in and out of the port and the 
efficiency of inter-modal transfers. The availability of rail 
transportation in the port, the use of clean fuels and technology in 
drayage operations, and emissions from truck traffic, locomotives, and 
ships need to be examined as a whole. In short, more efficient movement 
of cargo in and out of the port area results in reduced emissions and 
improved air quality.
    The North American Emission Control Area (ECA) established through 
the IMO in 2012 has reduced sulphur content in marine fuels from a 
maximum of 3.5% m/m to 0.10% m/m. This regulatory action has resulted 
in dramatic reductions of both SOx and PM emissions generated by ships 
visiting U.S. ports and transiting within 200 miles of the Atlantic, 
Pacific, and Gulf Coasts (specific coordinates are provided in Appendix 
VII of MARPOL Annex VI). On 1 January 2020 the IMO also lowered the 
maximum sulphur content of marine fuels used outside of emission 
control areas from a maximum of 3.50% m/m to 0.50% m/m. Both actions 
are expected to result in significant air quality benefits and 
reductions in estimated premature deaths in the United States and 
across the world.

 Question from Hon. Anthony G. Brown to John W. Butler, President and 
            Chief Executive Officer, World Shipping Council

    Question 1. In your opinion, what policy actions can Congress take 
to ensure that the Department of Defense's investment in blue carbon 
capture technology is accessible and leveraged by the commercial 
maritime industry?
    Answer. DOD's investment in blue carbon technology is an 
interesting area of technology development. If these research efforts 
lead to technologies that are appropriate and cost-effective for 
application in the commercial maritime sector, we would be interested 
in following such developments. At this point we do not have enough 
information to know whether this is a promising approach that could be 
applicable to commercial applications.

Questions from Hon. Peter A. DeFazio to B. Lee Kindberg, Ph.D., Head of 
          Environment and Sustainability-North America, Maersk

    Question 1. What strategies is Maersk using to reach its zero-
emission by 2030 goal? Please send a list of the technologies being 
deployed across the fleet.
    Answer. Over the last decade Maersk has reduced our fuel consumed 
and related emissions by 42% per container moved. This energy 
efficiency improvement was achieved in three primary ways: new larger, 
highly efficient vessels, significant retrofits of our existing 
vessels, and improved operational and vessel management practices. 
Retrofits to our existing vessels include optimizing propulsion systems 
and bulbous bows, engine modifications, and elevating the bridge and 
lashing racks to carry more cargo on the same vessel.
    In December 2018 Maersk announced a goal of Net Zero Carbon 
Shipping by 2050. More near-term goals are to launch our first zero 
carbon vessel by 2030, and to continue our energy efficiency work with 
a 2030 goal of a 60% reduction in CO2 emissions vs. 2008.
    To achieve these goals we are investing in a range of new 
innovative fuel and technology programs, and are piloting other 
technologies such as installation of a large marine battery. We will 
continue implementation of the radical retrofit program mentioned above 
and continue improving planning and optimizing of our networks and 
operations. We also maturing, hardening and fully implementing the 
innovative digitalization Connected Vessel program. This program is 
connecting our fleet digitally with our global operations coordination 
centers and enables real-time optimization of operational conditions. A 
brief video with more information is available at https://www.bing.com/
videos/search?q=youtube+maersk+zero+carbon&view
=detail∣=1081847AE8FF0279FA751081847AE8FF0279FA75&FORM=VIRE.

    Question 2. What alternative fuels and energy sources will have the 
smallest greenhouse gas emission impact? What work has Maersk done to 
operationalize the use of those fuels?
    Answer. In October 2019 we published a study together with Lloyds 
Register where we openly shared what we see as the three best option to 
Decarbonize ocean shipping: Alcohols (biofuels/LEO etc.), Biogas and 
Ammonia. We are also following developments in fuel cells and
    Biofuels can have no ``tailpipe'' CO2 emissions, reducing the 
lifecycle CO2 footprint to the levels required to produce and transport 
the fuel (comparable to ``well to wheel'' metrics for conventional 
fuels). Our work on innovative biofuels includes a Lignin Ethanol Oil 
project, and the new Maersk ECO Delivery product.

    Question 3. How has Maersk collaborated with shore infrastructure 
operators (i.e., ports, marine terminals, fuel suppliers) to source 
fuels? What challenges arose, and what government support enabled 
successful implementation?
    Answer. At this time the fuels needed have been available through 
our traditional suppliers, with whom we have worked closely for many 
years (especially for the successful implementation of the IMO 2020 
fuel program). Shore power/electrification has required close 
cooperation with marine terminals and ports in California for over 10 
years to ensure vessel and shore-side infrastructure are compatible and 
aligned. Continued communication and cooperation are needed for ongoing 
shore power operations.
    For future fuels, the shore side need will be driven by the fuel 
types selected--their physical properties and any possible fuel 
handling risks identified. Clearly cooperation with shippers and ports 
will be essential, and time and investment needed to enable 
implementation. As an example, the Port of Rotterdam was one of the 
core partners in our first biofuel trial in April-May 2019.

    Question 4. What would it take to advance the US position in the 
clean maritime industry and totally decarbonize our maritime sector?
    Answer. Global action is required to address the challenges of 
decarbonizing international shipping. Mr. Butler of the World Shipping 
Council, who also spoke to the Subcommittee hearing on this topic, may 
be an excellent resource on policies to advance decarbonization.

    Question 5. Shore power technology has the potential to virtually 
eliminate greenhouse gas emissions from maritime vessels while at 
berth, put upfront capital expenditure has deterred operators from 
investing in such infrastructure.
    a. What sorts of incentives and supports could help promote at-
berth electrification for Maersk vessels?
    b. What sorts of collaboration and coordination are necessary to 
ensure international operators can plug in to an electric grid here and 
abroad? What are the advantages of that approach?
    Answer (a.-b.). The investment required for shore power is indeed 
significant, both on vessels and the land side. In addition, like other 
electrification programs, the benefit of shore power is dependent on 
availability of plentiful electricity from clean sources. Only 
California has made the enormous investment required to provide both 
shore power infrastructure and to green their electric grid.
    Even in California shore power is only in use for container, cruise 
and refrigerated cargo in five ports. And some of these ports do not 
have sufficient off-port electrical power supply or on-port 
infrastructure to enable full use of this technology. Other types of 
vessels and ports (e.g., tankers, vehicle carriers and bulk cargo 
ships) do not yet have shore power capability. Some US military 
installations do have shore power capability.
    While there is an international ISO/IEEE standard for shore power 
it may need updates to serve a broader range of vessel types and 
cargos. This standardization is essential for international 
compatibility. Technical and operational challenges also still impede 
full use of shore power, including aligning connections for vessel and 
shore as vessel sizes change, congestion, and challenges with equipment 
reliability in the ocean salt environment. Close cooperation between 
ports, marine terminals, vessel owners and operators and regulatory 
agencies is important for this implementation, and to date public 
funding has been required for broad implementation.

    Question 6. The International Council on Clean Transportation 
reports that over 59,000 people died from effects of shipping emissions 
in 2015, and the ongoing effects of port activity on local 
communities--disproportionately low-income communities of color--
include asthma and other chronic illnesses. What steps can we take 
today to mitigate these impacts?
    Answer. Since 2015 a number of measures have been implemented to 
reduce the environmental impacts of ports in the US. The North American 
Emissions Control Area (ECA) is a 200-mile band around the US and 
Canada where cleaner fuel has been required since 2012. In 2015 the ECA 
fuel sulfur limit stepped down from 1.0% sulfur to 0.1%S, reducing 
emissions of sulfur oxides by an additional 90%, and also reducing 
related fine particles significantly. In January 2020 the global fuel 
sulfur limit changed from 3.5% to 0.5%. IMO and the North American ECA 
also set requirements for engines to produce fewer oxides of nitrogen 
(NOx). These requirements will continue to phase in as new vessels 
replace older ones, continuing to reduce emissions from the global 
fleet for the next decades.
    Other steps being taken in some ports include incentive programs 
for voluntary vessel speed reductions and encouraging deployment of 
newer lower-emitting vessels. On the land side, cargo handling 
equipment can be electrified, incentive programs help implement newer 
lower-emitting trucks sooner, and shore power can reduce emissions if 
electric power is from clean or renewable sources.

    Question 7. Has Maersk invested in any of the following existing 
zero-emission technologies: Electric Ship-to-Shore (STS) Rail-Mounted 
Gantry Cranes, Electric Rubber-Tired Gantry (RTG) Cranes, Electric 
Rail-Mounted Gantry Cranes, Electric Bulk Handling Crane, Carry Deck 
Cranes, Reach Stackers, Shuttle Carriers, Straddle Carriers, Trailer 
Spreaders, Electric Forklifts, Electric Pallet Trucks, or Top Front End 
Payloaders?
    Answer. Our sister company APM Terminals has invested in several of 
these technologies in their US and global facilities.

Question from Hon. Anthony G. Brown to B. Lee Kindberg, Ph.D., Head of 
          Environment and Sustainability-North America, Maersk

    Question 1. In your opinion, what policy actions can Congress take 
to ensure that the Department of Defense's investment in blue carbon 
capture technology is accessible and leveraged by the commercial 
maritime industry?
    Answer. I was not familiar with the DoD's blue carbon capture 
technology. Carbon capture is certainly of interest for all large 
energy users, and we will seek further information on this capability. 
Transparency and collaboration between military and civilian industry 
are important in technology transfer, and we would be interested in 
discussing such potentials further.

 Question from Hon. Carol D. Miller to B. Lee Kindberg, Ph.D., Head of 
          Environment and Sustainability-North America, Maersk

    Question 1. It is impressive that MAERSK has reduced their fuel 
consumption by over 40 percent in the last decade. As we enter a new 
decade, what progress do you expect the industry to make over the next 
ten years?
    Answer. Maersk is continuing our work to dramatically improve 
energy efficiency and thus reduce fuel-related emissions. Our 2030 goal 
is to have reduced our fuel use and related CO2 emissions by 60%, and 
to launch our first carbon neutral vessel. We have committed to Zero 
Carbon Shipping by 2050.
    Based on results reported annually to the Clean Cargo Working 
Group, which do include Maersk's results, the container shipping 
industry as a whole has also made impressive progress in emissions 
reduction. Since Clean Cargo began publicly reporting data from the 
industry in 2009, emissions per container per kilometer have dropped 
37.1 percent on average. Maersk and the other members of Clean Cargo 
remain committed to continued progress.
    The international regulatory structure for emissions reduction is 
developing at IMO, with some metrics and goals in place and others 
being developed. The IMO website describes these goals as follows 
(source: http://www.imo.org/en/MediaCentre/
HotTopics/GHG/Pages/default.aspx):

        ``In April 2018, IMO's Marine Environment Protection Committee 
        (MEPC) adopted an initial strategy on the reduction of 
        greenhouse gas emissions from ships, setting out a vision to 
        reduce GHG emissions from international shipping and phase them 
        out, as soon as possible in this century. The vision confirms 
        IMO's commitment to reducing GHG emissions from international 
        shipping and, as a matter of urgency, to phasing them out as 
        soon as possible.

        ``More specifically, under the identified ``levels of 
        ambition'', the initial strategy envisages for the first time a 
        reduction in total GHG emissions from international shipping 
        which, it says, should peak as soon as possible and to reduce 
        the total annual GHG emissions by at least 50% by 2050 compared 
        to 2008, while, at the same time, pursuing efforts towards 
        phasing them out entirely. ``The strategy includes a specific 
        reference to ``a pathway of CO2 emissions reduction consistent 
        with the Paris Agreement temperature goals''.

        ``The full text of the Initial IMO Strategy on reduction of GHG 
        emissions from ships can be downloaded here [https://
        unfccc.int/sites/default/files/resource/
        250_IMO%20submission_Talanoa%20Dialogue_April%202018.pdf], . . 
        .''

Questions from Hon. Peter A. DeFazio to Peter Bryn, Technical Solutions 
              Manager-North America, ABB Marine and Ports

    Question 1. What technologies can help operators meet a zero-
emission by 2030 goal? Please send a list of the technologies you would 
consider.
    Answer. There are a number of technology options available to ship 
owners and operators for reducing or eliminating emissions. It is 
critical that ship owners and operators identify the proper solution 
for the operational needs of their vessel. For most segments and 
technologies, an electric propulsion system is a key enabling 
technology. My testimony provides a list of those technologies on page 
six and then provides further detail by vessel segment on pages 8-
14.\\
---------------------------------------------------------------------------
    \\ Editors's note: Please see Mr. Bryn's testimony as it 
appears at https://docs.house.gov/meetings/PW/PW07/20200114/110356/
HHRG-116-PW07-Wstate-BrynP-20200114.pdf.
---------------------------------------------------------------------------
    Some vessel segments have more readily available zero emissions 
options than others. For example, ferries have become one of the 
pioneering vessel types for zero-emission battery deployment because 
they combine generally shorter routes with regular port visits. The 
shorter routes allow installation of battery packs that can fully power 
the vessels on their journeys while the predictable routes and 
turnaround times enable efficient deployment of shoreside charging 
infrastructure. For these reasons, its unsurprising that the ferry 
industry is among the first marine segments to adopt full battery-
electric solutions.

    Question 2. How has ABB collaborated with shore infrastructure 
operators (i.e., ports, marine terminals, fuel suppliers) to source 
fuels and energy? What challenges arose, and what government support 
enabled successful implementation?
    Answer. ABB provides a number of low and zero emissions 
technologies to ports and marine terminals including: electric cranes 
and gates, microgrids, energy storage solutions, control systems, and 
ship to shore electrical infrastructure. Some examples include: Long 
Beach Container Terminal [https://www.youtube.com/watch?v=JIrPWW6r1uo], 
and a number of ship to shore projects [https://new.abb.com/
substations/port-electrification-and-shore-to-ship-power]. Emission 
reduction policies and targets have played an integral role in 
incentivizing low and zero emission technology deployments at ports, 
particular for ship to shore connections. Other low and zero emission 
solutions like electric port operations (gates, cranes, vehicles) 
benefit from government policies focused on lower emissions as well as 
funding mechanisms to assist owners and operators convert existing 
diesel powered systems to electric grid powered systems.

    Question 3. What would it take to advance the US position in the 
clean maritime industry and totally decarbonize our maritime sector?
    Answer. The US could position itself as a leader in the clean 
maritime industry by setting clear, national, and ambitious 
decarbonization targets for both federal and merchant fleets as well as 
providing financial support and incentives for research, development, 
and deployment of zero emissions marine technologies, including 
shoreside infrastructure for charging and carbon free fuels.

    Question 4. The International Council on Clean Transportation 
reports that over 59,000 people died from effects of shipping emissions 
in 2015, and the ongoing effects of port activity on local 
communities--disproportionately low-income communities of color--
include asthma and other chronic illnesses. What steps can we take 
today to mitigate these impacts?
    Answer. Transitioning to low and zero emissions technology for port 
operations, on vessels, and for ship to shore power (cold-ironing), can 
reduce or eliminate local emissions. Importantly, low and zero emission 
solutions often have strong economic benefits, including increased 
container throughput and productivity, and lower maintenance and 
operations costs for both vessels and ports. The federal government has 
a number of policy tools at its disposal to encourage this transition 
that range from setting emission standards to investing in 
electrification of port operations and shoreside power for cold-
ironing.

    Question 5. What vessels in Federal fleet, particularly those used 
the Coast Guard, could see substantial emissions reductions using 
existing technology while still meeting mandated use? What federal 
programs (existing or not) could facilitate rapid uptake of no/low-
carbon technologies?
    Answer. There are a number of Federal Fleet ships that could use 
existing technology to reduce their emissions, while also preparing 
them for even further reductions as new zero emission technologies are 
commercialized over the course of their lifetime. Two types of vessels 
that provide near term emission reduction opportunities include: (1) 
MARAD National Security Multi-Mission Vessels and (2) Coast Guard 
Waterways Commerce Cutters. Other vessel classes that provide 
opportunities for emissions reductions include vessels operated by: 
National Park Service, US Coast Guard, National Oceanic and Atmospheric 
Administration, among others.
    In the near-term, the Passenger Ferry Grant Program (S.5307) could 
facilitate the uptake of commercially ready zero-emission ferries in a 
number of ways, including, for example: requiring a certain portion of 
grant funding to specifically support zero-emission ferries or 
infrastructure; or establishing a zero-emission sub-program similar to 
the transit bus low/no program (S.5339c).

Question from Hon. Anthony G. Brown to Peter Bryn, Technical Solutions 
              Manager-North America, ABB Marine and Ports

    Question 1. In your opinion, what policy actions can Congress take 
to ensure that the Department of Defense's investment in blue carbon 
capture technology is accessible and leveraged by the commercial 
maritime industry?
    Answer. Blue carbon capture refers to technology to remove CO2 
directly from the atmosphere and is in the very early stages of 
research and development. A few policy principles could help facilitate 
commercial readiness and adoption, including, but not limited to:
      Providing consistent, predictable and steady federal 
investment over a number of years;
      Establishing cross-disciplinary planning, research, 
development, and deployment teams;
      Involving commercial and private sector advisors, 
collaborators, and project partners from the start of the program;
      Promoting and fostering cross-agency cooperation, 
including: Department of Energy, National Science Foundation, National 
Oceanic and Atmospheric Administration, Department of Defense, and 
others.

Foreword to Responses from Kathy Metcalf, President and Chief Executive 
                Officer, Chamber of Shipping of America

    summary of perspectives of the commercial maritime industry in 
                       providing responses below
    While understandably, this hearing focuses on the relationship of 
this issue to the US maritime system, it is important to recall that 
shipping is global in nature as are the impacts of greenhouse gases 
(GHGs) and CO2 emissions. The most robust control mechanisms in one 
country will never make up for the lack of control systems in other 
countries. Thus the solution to a successful GHG emissions reduction 
program must be global in nature, adopted by the International Maritime 
Organization's (IMO) Member States and fully implemented by national 
governments with jurisdiction over ports (port states), coastal states, 
and flag states. In this respect, the ``common but differentiated 
responsibilities'' (CBDR) principle applied by the United Nations 
Framework Convention on Climate Change (UNFCCC) which distinguishes 
between developed and developing countries should have no place in the 
development of GHG control mechanisms for global shipping. Rather the 
International Maritime Organization's (IMO) ``no more favorable'' 
treatment principal should apply and thus the IMO should be the lead UN 
agency in developing the way forward in addressing GHG emissions from 
shipping. It is critical that the US and its fellow IMO Member States 
work together to develop a truly global program for GHG emissions 
reductions and establish a level playing field for vessels, ports and 
coastal states.
    The solutions to address the decarbonization of shipping rest with 
both governments and the private sector. A good example of private 
sector activities is the Global Maritime Forum (GMF) which is founded 
on the idea that ``progress happens when people from all parts of a 
system--in this case the global maritime industry and its stakeholders 
who have the will and the influence to make positive change--come 
together to discuss challenges and work together on finding new 
solutions''. Its objective is ``to shape the future of global seaborne 
trade to increase sustainable long-term economic development and human 
wellbeing''. To put the magnitude of this problem and its solution in 
perspective, the GMF has estimated that at least USD 1 trillion in 
investments will be needed to decarbonize shipping with the major need 
for investment upstream in energy and fuel production (87%). For more 
information on the GMF, please see their website at https://
www.globalmaritimeforum.org/. For more information on their scale of 
investment study, please see https://www.globalmaritimeforum.org/press/
new-analysis-puts-a-price-tag-on-maritime-shippings-decarbonization.
    We provide this information to make the point that the research and 
development and costs associated with the decarbonization of shipping 
and the land-based industries which will support this paradigm change, 
is not within the financial bounds of most countries or the industry. 
It is however within the bounds of an international collaboration among 
all the stakeholders including governments, the shipping industry, 
energy producers, ports and environmental organizations. Collaboration 
on what is arguably one of the most significant issues of our 
generation is critical to execute the transition to the decarbonization 
of the shipping industry and all its supporting components.
    It is important to realize that not all vessels are the same either 
in structure or in operational profiles. To successfully transition, a 
number of solutions will likely be identified unique to a particular 
type/size of vessel and/or trading patterns, making even more complex, 
the ultimate solution for application to the global fleet.
    To fully appreciate the commitments the global shipping industry 
has made to achieve these goals, the International Chamber of Shipping 
(ICS), of which we are a founding member, co-hosted a successful side 
event at the UNFCCC Conference of the Parties (COP 25) in mid-December. 
During that side event, ICS on behalf of the global shipping industry 
stated that ``as shipping's global regulator, the UN International 
Maritime Organization has successfully enhanced the sector's impressive 
environmental performance through a comprehensive framework of 
regulations which enjoy robust enforcement worldwide and this includes 
greenhouse gas reduction''. The ICS spokesperson further stated that 
``there are already mandatory CO2 reduction regulations in force 
globally that will require all ships to be at least 30% more carbon-
efficient by 2025. In line with the ambitious CO2 reduction targets 
which IMO Member States agreed last year (2018), the IMO will adopt a 
new package of regulations in 2020 with a focus on operational fuel 
efficiency and speed optimization. This should ensure further CO2 
reductions by 2023 and assure that the sector is on track to exceed the 
IMO target of a 40% efficiency improvement across the entire world 
fleet by 2030.'' Regarding the ambitious 2050 goal, the ICS 
spokesperson stated that ``the industry's greatest priority is to help 
the IMO make rapid progress with implementing its very ambitious 2050 
target, cutting the sector's total CO2 emissions, regardless of trade 
growth, by at least 50%, with full decarbonisation soon after. 
Accelerating R&D of zero-carbon technologies and propulsion systems 
that can be applied on trans-oceanic ships must therefore be at the 
heart of the IMO strategy.''

 Questions from Hon. Peter A. DeFazio to Kathy Metcalf, President and 
        Chief Executive Officer, Chamber of Shipping of America

    Question 1. Reports of emerging environmental, climate, and health 
impacts of black carbon produced by current ``alternative'' fuels like 
LNG indicate that the full transition away from LNG-powered 
transportation may be a critical step to ensure a livable future on 
earth. What are the necessary steps to transition our marine 
transportation system toward 100% clean energy sources?
    Answer. The first step towards operationalizing 100% clean energy 
sources is the creation of a global R&D program which can identify 
alternative fuels both transitional and zero carbon. To date possible 
alternatives include electric/battery, hydrogen, green ammonia, and 
biofuels. Once the ``possible'' is identified, research needs to be 
done to determine the capabilities of ships, port infrastructure and 
energy producers to use, produce and distribute fuels on a global 
basis. Parallel work to the alternative fuel initiative is identifying 
the needed changes to marine propulsion systems and onboard storage 
requirements so that reliable and safe systems can be integrated into 
new ship design.

    Question 2. What strategies is are members of the Chamber using to 
reach the IMO emission reduction targets? Please send a list of the 
technologies being deployed across the fleet.
    Answer. To the best of our knowledge, very few large commercial 
ships are able to integrate zero carbon solutions on board their 
vessels at this point in time due to the non-availability of zero 
carbon fuels and propulsion systems that can utilize these fuels. 
Various technologies are being reviewed and in some cases are the 
subject of research programs which include application of more 
stringent energy efficiency design standards, application of energy 
efficiency design concepts to existing ships, mandatory power 
limitations on ships, goal based short term reduction measures as part 
of the Ship's Energy Efficiency Management Plan (SEEMP), strengthening 
of the existing SEEMP, and speed optimization. While these examples are 
concepts, the technologies associated with implementing some of these 
measures are not yet developed or in extreme cases, not yet identified. 
An excellent primer on the challenges facing the industry may be found 
in the document published by the classification society DNV-GL entitled 
``Energy Transition Outlook 2019'' which may be downloaded at https://
eto.dnvgl.com/2018/maritime. Of particular note is the information 
found on alternative fuel technology (Chapter 3), fuel flexibility as a 
bridge towards low-carbon shipping (Chapter 4) and the ecosystem 
approach to bridge the emissions cap (Chapter 5).

    Question 3. What alternative fuels and energy sources will have the 
smallest greenhouse gas emission impact? What work have your members 
done to operationalize the use of those fuels?
    Answer. As indicated above, operationalization of lower carbon or 
zero carbon fuels on large commercial ships is not yet possible in most 
cases due to the nonavailability of the alternative fuels and 
propulsion systems designed to use them. Our members, via CSA's 
involvement and information sharing with international industry 
colleagues and IMO Member States, are reviewing a number of 
alternatives for consideration in future new builds which also includes 
discussions with governments, the global classification societies and 
engine manufacturers. Although much research remains to be done on the 
GHG emissions impacts of specific transitional (low carbon) and zero 
carbon fuels, current focus is on methanol, LNG/LPG, electrification 
(battery hybrid systems), biofuels, hydrogen and ammonia.

    Question 4. How have your members collaborated with shore 
infrastructure operators (i.e., ports, marine terminals, fuel 
suppliers) to source fuels? What challenges arose, and what government 
support enabled successful implementation?
    Answer. The nature of our members' collaboration with shore 
infrastructure varies with the commercial arrangements between vessel 
owners and terminal operators and ship types. For example, one of our 
member companies own and operate container vessels and own and operate 
their terminal facilities in the US. In this case, integration of shore 
power (cold ironing) into the port operating profile of their vessels 
was facilitated by the fact that both the ship and terminal were owned 
and operated by the same entity. In other cases (the majority,) vessels 
call at terminals that are not owned by the company which owns the 
vessel which makes the implementation of vessel/shore infrastructure 
collaboration more difficult especially when taking into account that 
ownership of the terminal may range from a private entity to a public 
port authority. As regards sourcing of fuels, vessel owners work very 
closely with established marine fuel/bunker providers to assure the 
availability of compliant fuel (0.1% for use in the emissions control 
areas, 0.5% for use outside the emission control areas). Although zero 
carbon fuels are not yet available in the global marketplace (nor are 
vessels which can utilize these fuels), it would be expected as we 
transition to zero carbon fuels, a similar dialogue will occur between 
fuel providers and the vessels which will purchase and use these fuels.
    CSA as an organization is working with a number of global port 
initiatives which are discussing the need for infrastructure to 
accommodate both transition fuels and eventually zero-carbon fuels. Two 
examples of these collaborative efforts are the World Ports 
Sustainability Program (WPSP) and the Global Industry Alliance (GIA).
    WPSP is composed of the American Association of Ports Authorities, 
the European Sea Ports Organization, the International Association of 
Cities and Ports and the World Association for Waterborne Transport 
Infrastructure. WSPS is focused on the UN Sustainable Development Goals 
by engaging business, governments and societal stakeholders to add 
value for local communities and wider regions in which ports are 
embedded. More information on this project can be found at https://
sustainableworldports.org/
    GIA is an ongoing project overseen by the IMO in partnership with 
two other UN agencies and is focusing on the development of public/
private partnerships among key stakeholders including shipowners, 
operators, classification societies, engine and technology builders and 
suppliers, big data providers, oil companies and ports. More 
information on this project can be found at https://glomeep.imo.org/
global-industry-alliance/global-industry-alliance-gia/
    Both programs are a result of the recognized need for collaboration 
and coordination across all stakeholders to address environmental 
issues associated with shipping and ports, including the 
decarbonization of shipping.

    Question 5. In your testimony, you discussed a complex web of 
environmental impacts in the maritime sector. What would it take to 
comprehensively and sustainably advance the US position in the clean 
maritime industry and totally decarbonize our maritime sector?
    Answer. While marine transportation is by far the most 
environmentally friendly form of transportation on a ton per distance 
traveled basis, the industry has long been committed to the principle 
of continuous improvement in our safety and environmental performance 
and reduction of our environmental footprint. The complex web of 
environmental issues to which I referred in my testimony relates to the 
need to appreciate that environmental improvements in one specific area 
of vessel operations may adversely impact the environmental performance 
in other areas. Our goal is, of course, to address these issues 
holistically so that the maximum net environmental benefit is realized. 
The same is true with regard to all transportation modes and their GHG 
emissions control strategies. As noted above that shipping is the most 
environmentally friendly form of transportation on a ton per distance 
traveled basis, we must be certain that shifts to other less friendly 
transportation modes do not result from GHG reduction strategies 
applied to the global maritime industry.

    Question 6. Shore power technology has the potential to virtually 
eliminate greenhouse gas emissions from maritime vessels while at 
berth, put upfront capital expenditure has deterred operators from 
investing in such infrastructure.
    a. What sorts of incentives and supports could help promote at-
berth electrification for your members' vessels?
    b. What sorts of collaboration and coordination are necessary to 
ensure international operators can plug in to an electric grid here and 
abroad? What are the advantages of that approach?
    Answer. Please permit me to respond to these two questions in a 
single response. In our opinion, the largest obstructions to the global 
adoption of the use of shore power while a vessel is at berth is two-
fold. The first is the lack of a global land-based and shipboard 
standard for shore power provision and standardization of the ship/
shore interface. This is a significant challenge since the energy 
demands of a vessel at berth vary with the type of vessel. The second, 
and equally important obstruction, is capital cost to the terminal 
operator (land-based infrastructure) and to the vessel owner to 
retrofit its vessels to connect to shore power. While these are not 
insurmountable challenges, they will require a coordination between the 
global shipping industry and terminals to assure a safe and sufficient 
power supply is available to vessels of all types. Another confounding 
aspect of this issue relates to the commercial ownership profiles of 
terminals worldwide. In some cases, terminals are privately owned while 
in other cases, these terminals are owned and operated by national 
governments or regional port authorities and thus funding streams would 
need to be created by both public and private entities.
    In our opinion the necessary incentives and supports to promote a 
global at-berth electrification program require collaboration and 
coordination of all stakeholders to provide a globally consistent set 
of requirements for both the vessel and land-based infrastructure which 
will provide the shore power to the vessels. This process has been 
underway at IMO as regards standardization of the ship to shore 
interface for vessels but does not seem to be developed on the shore 
side of the connection, understandable due to the wide variation in 
terminal ownership characteristics as well as national initiatives to 
promote the shore power concept. Once this coordination is well 
underway, discussions on funding should ensure that funding for the 
shore based infrastructure would occur at least at a national level or 
in some cases at regional or port level programs.
    One comment we would offer on the use of shore-power is the need to 
recognize that emissions reduced at the ship/shore interface through a 
shore power program, must be viewed in the perspective of the ultimate 
source of the shore power. For example, China has put a limited shore 
power usage requirement in some of its major ports, but to the best of 
our knowledge the power is being generated by coal-fired power plants 
which, at a minimum, results in a zero net emissions reduction or, more 
likely, an increase in net emissions given the land-based emissions 
associated with coal-fired power plants.

    Question 7. The International Council on Clean Transportation 
reports that over 59,000 people died from effects of shipping emissions 
in 2015, and the ongoing effects of port activity on local 
communities--disproportionately low-income communities of color--
include asthma and other chronic illnesses. What steps can we take 
today to mitigate these impacts?
    Answer. While we are not in a position to address environmental 
issues ashore which result from the close proximity of port and 
terminal facilities with low-income communities of any type, the global 
maritime industry's commitment to reduction of its environmental 
footprint via all media, will result in the net improvement of 
environmental quality in the port/terminal areas at least as regards 
the emissions from the vessel while at berth. Collaboration between the 
port and global maritime community can further decrease the impacts of 
marine operations in these areas even further.

  Question from Hon. Anthony G. Brown to Kathy Metcalf, President and 
        Chief Executive Officer, Chamber of Shipping of America

    Question 1. In your opinion, what policy actions can Congress take 
to ensure that the Department of Defense's investment in blue carbon 
capture technology is accessible and leveraged by the commercial 
maritime industry?
    Answer. The important issue highlighted by this question is not 
unique to the commercial access to blue carbon capture technologies 
being pursued by the Department of Defense (DOD). As a result of the 
significant R&D budgets allocated to DOD, many cutting edge 
environmental issues have been the subject of DOD research projects 
including hull fouling, underwater noise generation by vessels and 
technologies used to control and monitor operational discharges from 
vessels. While some sharing of information has occurred in the past, 
the commercial maritime industry has rarely been the benefactor of 
findings from DOD studies due to security classifications. While it 
would clearly be inappropriate to publicly share information with 
national security implications, a better process to timely review and 
remove security classifications from studies which have never or no 
longer carry national security implications would be a critical 
development to enable sharing of information between the military and 
commercial maritime sectors.

  Questions from Hon. Carol D. Miller to Kathy Metcalf, President and 
        Chief Executive Officer, Chamber of Shipping of America

    Question 1. The shipping industry has pledged to generate 5 billion 
dollars over the next 10 years to help meet the International Maritime 
Organization 2050 emission reduction targets. How will the money be 
used to accomplish this goal?
    Answer. The global maritime transport industry has submitted a 
proposal to form the world's first collaborative shipping R&D program 
to help eliminate CO2 emissions from international shipping. This 
proposal was discussed at length at the hearing by Mr. John Butler of 
the World Shipping Council. A copy of the industry proposal to IMO is 
attached to his testimony at Annex A. CSA participated in the 
development of this initiative as a founding member of the 
International Chamber of Shipping, one of the 8 sponsors of this 
proposal which also included the World Shipping Council. This proposal 
includes the creation of an International Maritime Research and 
Development Board (IMRB), a non-governmental R&D organization that 
would be overseen by IMO Member States with a primary focus of 
accelerating the research, development and deployment of low-carbon and 
zero-carbon fuels, energy sources, propulsion systems and other new GHG 
reduction technologies that will be necessary to meet the 2050 goal set 
by the IMO strategy. The IMRB would be composed of a Board of 
Directors, Executive Director and a professional staff with specific 
responsibilities including:
      Development, direction, management and administration of 
the international maritime research and development strategy designed 
to promote the development of low-carbon and zero-carbon technologies 
and fuels for use across the maritime sector, including propulsion 
systems;
      Identification, definition and ongoing refinement of the 
specific research priorities established within the mandate and charter 
of the IMRB;
      Development of specific R&D programs, review of proposals 
received, and decisions concerning specific project approval and 
funding;
      Consideration of changes and modifications to specific 
research and development objectives in light of project results, 
technology developments, and experience gained;
      Administration of the collection of R&D contributions and 
the issuance of evidence of contributions having been made by 
shipowners; and
      Management and administration of the International 
Maritime Research Fund (IMRF) including all fiduciary responsibilities 
and provision of regular progress reports, assessments, and 
recommendations to the supervisory body which would report to the IMO 
Marine Environment Protection Committee.

    While the IMRB is still in proposed form and will be discussed at 
the spring 2020 meeting of the IMO Marine Environment Protection 
Committee, it is envisioned that the IMRB Board would include non-
governmental professionals with experience in research and development, 
shipping, shipbuilding, zero-carbon fuels, environmental energy policy 
and other expertise relevant to the work of the Board, all contributing 
to the identification of promising research projects and the necessary 
oversight of these projects as they are being conducted.

    Question 2. How has the shipping industry worked with the U.S. 
Government to promote smart, proactive regulations and what can we do 
in Congress to make sure that American shipping remains competitive?
    Answer. The Chamber of Shipping of America is committed to work 
with stakeholders at the international and US national level, first as 
a member of the International Chamber of Shipping delegation to the IMO 
as well as working with members of the US delegation to IMO which 
includes representatives from EPA, the US Coast Guard and the Maritime 
Administration (MARAD). Nationally, MARAD, although working with a 
woefully inadequate budget, has conducted a number of research projects 
in this area through its Maritime Environmental and Technical 
Assistance (META) Program. Under the META program, MARAD partners with 
federal, state and local agencies, the maritime industry and academia, 
to develop and carry out projects that provide information and insight 
on key maritime environmental issues. To date, projects have been 
carried out or are currently underway in the areas of vessel and port 
emissions, biofuels, fuel cells, liquefied natural gas (LNG), emissions 
reduction technologies, hybrid and batteries and energy efficiency 
technologies. The META program's impacts could be significantly 
increased with a larger budget allocation which would enable MARAD to 
delve into new issues and expand the scope of their studies on existing 
issues.
    Similar programs are underway in a number of countries but better 
coordination at the international level is needed to avoid duplication 
and promote a sharing of information and expenses in conducting these 
much needed research projects.
    As regards the competitiveness of the US shipping industry i.e. US 
flag, there is no doubt that these initiatives will significantly add 
to the capital cost of building a vessel as well as the operating costs 
associated with what are likely to be more expensive fuels. While it is 
expected that these costs will be borne across the entire industry, 
regardless of flag, the current cost differentials between US flag 
vessels versus non-US flag vessels will at least remain the same if not 
increase.

    Question 3. It is important to recognize the importance that 
traditional fuel will continue to play in global trade in powering our 
fleets, especially in deep sea shipping. How has the industry continued 
to innovate when it comes to traditional fuel sources?
    Answer. In an ideal world, the shift from traditional fuels to 
carbon neutral fuels would be a seamless and accelerated transition 
regardless of whether the fuel was used in a land based or sea based 
application. As is implied in this question, use of traditional fuels 
will continue until such time as new carbon neutral fuels are produced 
in sufficient volumes, new vessels are constructed with propulsion 
systems that can utilize these carbon free fuels and the necessary 
shore infrastructure is in place to supply these carbon free fuels to 
the global maritime industry. In the meantime, the global shipping 
industry has adopted a number of measures already in place that are 
reducing emissions from vessels. These measure include the adoption of 
the energy efficiency design index (EEDI) applicable to new vessels, 
the ship's energy efficiency management plan applicable to both new and 
existing vessels and more stringent requirements for reduced nitrogen 
oxide (NOx) emissions from marine engines. In addition to these 
measures the sulfur levels of marine fuels have been drastically 
reduced from an average 2.5% sulfur level to a 0.5% sulfur level for 
fuels used on the high seas and a 0.1% sulfur level for fuels used in 
IMO adopted emissions control areas which includes the North America 
and the Caribbean emission control areas. While it is recognized that 
these measures will not bring the CO2 emissions down to the goals 
included in the IMO greenhouse gas emissions control strategy, these 
are early steps in reducing vessel emissions until such time as low or 
zero carbon fuels and vessels are in place.