WORKING PAPER - Financing zero-emission vessel shipbuilding in China Summary Introduction

» The engine cost was based on the power of the engine (megawatts), and the tank cost was based on the tank size (m3). [...] CZEV i,j - CVLSFO i,j Caverage i,j = (1)GTi,j Where: Caverage i,j i s the average additional CapEx per unit GT of ship type i, size j, in dollars/tonne CZEV i,j is the CapEx of representative ZEV of ship type i, size j, in dollars CVLSFO i,j is the CapEx of representative VLSFO ship of ship type i, size j, in dollars GTi,j is the GT of the representative ship of ship type i, size j, in tonnes Cmai. [...] Researchers have estimated that in order to reach the IMO’s initial strategy goal, the price of carbon needs to increase to about $100 per tonne of CO2 in the early 2030s and further to around $230–$260 per tonne of CO2 between 2035 and 2045 (Baresic et al., 2022). [...] Projection of maritime CO2 emissions and carbon revenue Our results show that the decade from 2030 to 2040 would be the most significant time window for the ZEV transition in shipbuilding, with annual revenues peaking at $93.6 billion in 2035 before dropping as the accelerated decarbonization of shipping reduces CO2 emissions and associated revenues. [...] As one of the biggest shipbuilding countries, China is positioned to play a critical role in the development of the ZEV shipbuilding industry and to help lead the transition to a zero-emission shipping future.