Carbon Insetting: A Sustainable Solution for the Shipping Industry


As global efforts intensify to reduce greenhouse gas emissions, the global freight industry faces a critical crossroads. According to the Smart Freight Centre, it currently shoulders a hefty 8% of global carbon emissions, with shipping alone contributing nearly 3%. Studies predict these emissions to double by 2050 due to surging demand. While voluntary climate action exists, it lacks coordination, leaving the pace of decarbonization woefully inadequate.

What is Carbon Insetting?

Pioneering shipping companies are embracing a more proactive strategy: Carbon insetting. Carbon insetting involves implementing greenhouse gas (GHG) emission reduction projects within a company’s own operations and supply chains.

For the shipping industry, carbon insetting presents a unique opportunity to address emissions at the source. Through strategic investments in various initiatives, shipping companies can significantly reduce their carbon footprint. These initiatives span from vessel engine retrofits to implementing a fuel switch. Fuel switch, o means the volume of sustainable biofuel that reduces the emissions will be fuelled into a third-party carrier that would have normally burned fossil fuel. Even though cargo may not be directly transported using biofuels, the mass balance principle ensures overall emission reductions. All reductions contribute to the bigger picture, propelling the industry towards a cleaner future.

The necessity of carbon insetting for the shipping industry is twofold: addressing Scope 3 emissions for customers and reducing their own Scope 1 emissions. Scope 3 emissions are the indirect emissions associated with a company’s upstream and downstream activities, including those generated by its suppliers, customers, and transportation partners. For shipping companies, much of their customers’ Scope 3 emissions can be attributed to transporting goods via maritime routes.

By implementing carbon insetting strategies, like the Low Carbon Fuel Program, shipping companies can provide their customers with a tangible solution to mitigate their Scope 3 emissions, positioning themselves as partners in sustainability and enabling their customers to meet their own emission reduction targets. Additionally, carbon insetting initiatives directly address the shipping industry’s Scope 1 emissions generated from their own operations.

Trust Normec Verifavia for Insetting verification

Leveraging our expertise in greenhouse gas verification, Normec Verifavia is the trusted partner for shipping companies seeking independent verification of their carbon insetting initiatives like the Low-carbon fuel program, or insetting with established registries like 123Carbon. We are dedicated to helping maritime operations to enhance transparency, accountability, and sustainability.

Supplier Admin Dashboard - MDs & SDoCs for Maritime Suppliers made easy

Supplier Admin Dashboard – MDs & SDoCs for Maritime Suppliers made easy