Response to Climate Change

Climate change is expected to expose humankind to major physical risks, such as serious natural disasters.

In June 2020, we reviewed our “K” LINE Environmental Vision 2050, and based on the results of the scenario analysis proposed by the Task Force on Climate-related Financial Disclosures (TCFD), identified issues to be addressed and revised some targets.

Furthermore, in November 2021, we recognized global climate change countermeasures as an issue that must be strengthened by the entire international community, and we therefore set a higher challenge of net-zero GHG emissions by 2050. In addition, as a long-term vision in our medium-term management plan announced in May 2022, we are committed to smoothly switching to other forms of energy for our company and society. We will promote the realization to a low-carbon and carbon-free society.

In April 2021, the “K” LINE Group restructured the existing organization and reformed the promotion system for sustainability to ensure it is a key management objective. The Corporate Sustainability Management Committee, chaired by the president & CEO, is enhancing corporate value by reviewing and formulating a promotion system for the “K” LINE Group’s sustainability management. Additionally, in October 2021, we established the new GHG Reduction Strategy Committee by integrating the Alternative Fuel Project Committee, which is in charge of accelerating initiatives for conventional vessels fueled by liquified natural gas (LNG) and the LNG fuel supply business and examining next-generation fuel and new technologies, with the Environment/Technology Committee, which formulates measures for compliance with environmental regulations, including technical aspects. Each of these two committees functions as a forum for strategic discussions. The Environmental Sub-Committee, a subcommittee under the Corporate Sustainability Management Committee, is responsible for operating the environmental management system (EMS) formulated in accordance with the “K” LINE Group Environmental Policy and the standards of the International Organization for Standardization (ISO). The subcommittee is also responsible for promoting other environmental activities.

The Paris Agreement sets out a long-term target to pursue efforts to limit the average global temperature rise to 1.5℃, well below 2℃, compared to preindustrial levels. In the spirit of the Paris Agreement, the International Maritime Organization (IMO), a specialized United Nations agency for maritime issues, has set targets and measures for international shipping activities. We are working to reduce the GHG emissions from our business activities in line with the IMO’s policies, but we recognize that efforts to reduce GHG emissions may be insufficient, and that the 4℃ warming scenario and the intensification of physical risk is a possibility. The Group must build the resilience to adapt to those conditions to ensure that its business operations will continue. We have formulated road maps for how the Group should prepare for the anticipated negative (risks) and positive (opportunities) aspects of both the below 2℃ warming scenario and the 4℃ warming scenario.

We will steadily promote an action plan for achieving the interim milestones for 2030 that have been set out in our “K” LINE Environmental Vision 2050.
We will take on the new challenge of achieving net- zero GHG emissions as a target for 2050. We will aim to help enrich the lives of people by also promoting support for the shift to a carbon-free society.

2050 Targets

"K" LINE decarbonization : Take on the challenge of net-zero GHG emissions

Support the decarbonization of society : Be the transporter and suppplier of new energy 

2030 Interim Milestones

“K” LINE low-carbonization : Improve CO2 emissions efficiency by 50% compared to 2008  
Support development of a low-carbon society : Transport and supply new energy for a low-carbon society

2023 Targets

“K” LINE decarbonization : 

【Reinforcement of measures to improve operational efficiency（fuel efficiency）】

・Reduce CO2 emissions through slow steaming.

・Improvement of ship operation managemant throuth performance analysis using AI technology.

【Study the introduction of low-carbon and decarbonize fuels】

・Study introduction of LNG, ammonia, and other fuel vessels.

・Use of carbon neutral fuels such as bio fuels.

【Contribution to the demonstration and diffusion of the Seawing automatic kite eystem】

・Trial and expansion of the introduction of the "Seawing" wind power propulsion auxilary system.

【Consideration and introduction of other new technologies】

・Consider adopting energy-saving equipment and add-ons（water - emisison boilers, inverters, etc.）in the new shipbuilding plan.

・Verify the effectiveness of energy-saving devices using AI analysis technology.

・Consider specifications to control mehane slip and N2O emissions.

・Study on-board CO2 capture technology.

【Onshore Initiatives】

・Reduce total electricity consumption and GHG emisisons associated with electricity consumption at onshore facilities to below the previous year's levels.

・Promote the introduction of electricity derived from renewable energy sources.

・Reduction of CO2 emissions by hybridization of cargo handling equimpent at lthe compant's terminals.

Support the decarbonizaion of society : 

【Development and expansion of new businesses that contribute to the low-carbon society】

・Contribute to supply chain development as a transportation company through membership in domestic and international organizations related to the utilization of hydrogen and ammonia.

・Participated in a commercial demonstraiotn project using a large liquefied hydrogen carrier, and worked toward the commercial use of hydrogen in society.

・Expand business related to renuwable energy such as offshore wind power generation and CCUS （liquefied CO2 transnport）.

・Promote efforts to realize CNP （Carbon Neutral Port）, participate in CNP study groups at each port, and study projects.

・Continuation of LNG fuel supply business for ships and consideration of ammonia fuel supply ships.

While taking on the challenge of achieving net-zero GHG emissions in 2050, we will first work toward achieving the 2030 interim milestones set out in the “K” LINE Environmental Vision 2050 by making the shift toward ships fueled by LNG, ships fueled by liquefied petroleum gas (LPG), and ships that use new zero-emission fuels such as ammonia and hydrogen, from the perspective of achieving low-carbon and carbon-free transition at “K” LINE. Additionally, we will promote initiatives for reducing CO2 emissions, such as using the Seawing automated kite system (wind propulsion) and Kawasaki Integrated Maritime Solutions (integrated vessel operation and performance management system).

“BANGKOK COLD STORAGE SERVICE, LTD,” which operates in Bangkok, Thailand, installed solar panels on the roof of its 2nd warehouse in 2014. Output of the solar power system is up to 112.5kw, and total output in 2016 was 165mwh. This energy is equivalent to 13.9% of the annual electricity consumption at this warehouse and greatly contributes to energy saving. Further, “BANGKOK COLD STORAGE SERVICE, LTD” has been engaged in business operations in consideration of the environment since obtaining verification of ISO14001 in 2009.

• Raised funds through Japan’s first climate transition loan (purpose specified finance) for the LNG-fueled car carrier, CENTURY HIGHWAY GREEN, in March 2021
• Raised approximately ¥110 billion through Japan’s first transition-linked loan (TLL) (purpose unspecified finance) in September 2021. Funds to be used to finance a range of environmental countermeasures aimed at decarbonization

• Full-scale internal launch of operation in April 2021. From fiscal 2022, this has been calculated with reference to an economic index that takes into account a future earnings contribution of ¥7,000 per ton of CO2
• Promote low-carbon transition and decarbonization projects by using them as an indicator for the evaluation of investment projects

We will promote initiatives, such as supporting the offshore wind power business, participating in and creating a fuel supply network for the hydrogen and ammonia transportation business, and participating in the CO2 transportation business, as a target for supporting the development of a low-carbon and carbon-free society set out in the “K” LINE Environmental Vision 2050, which aims to achieve net-zero GHG emissions by 2050.

• Participation in R&D and demonstration project for CO2 marine transportation together with the Engineering Advancement Association of Japan, Nippon Gas Line Co., Ltd., and Ochanomizu University. Completion of construction for demonstration project vessel scheduled for December 2023

• Entry into long-term contracts with Northern Lights for two liquefied CO2 vessels.
  The ships will be delivered in 2024 and will contribute to the world’s first full-scale carbon capture and storage (CCS) value chain.

• Collaborate with Chubu Electric Power Co., Inc., on a tidal energy project in Canada (aim to begin operation in 2023)
• Looking into carbon credits, carbon offsets, etc.
• Participate in international think tank Global CCS Institute
• Participate in joint CCS study in Malaysia

(Tons)

(Tons)

(g-CO2/ton-mile)