Executive Summary

The Seminar on Decarbonization by Electrification of Local Vessels, held on 30 July 2024, examined how Hong Kong can accelerate vessel electrification to meet its net-zero goals. While technology is ready — with advanced marine batteries, lightweight vessel design, and flexible charging solutions — deployment remains limited. Hong Kong’s short routes and dense port infrastructure make it an ideal global demonstration site, yet progress is held back by systemic barriers.

Two problems stood out. First, infrastructure constraints: ferry piers and terminals lack electrical capacity, and there is no coordinated plan to match vessel demand with grid upgrades. Second, financial gaps: while large operators may recover costs within 5–8 years through green finance, the small vessel sector — about 80% of the fleet — lacks access to subsidies and financing, leaving the majority underserved.

The seminar emphasized that technology and finance alone cannot deliver transformation without government leadership. International experience, from Norway’s Maritime Battery Forum to China’s multi-ministry framework, shows that coordinated policy is the critical catalyst.

Participants agreed on three immediate priorities:

1. Create a Hong Kong Maritime Battery Forum for public–private coordination.
2. Expand subsidies and financing access to small vessel operators.
3. Conduct a spatial demand study to guide charging and grid investment.

The conclusion was clear: Hong Kong has the means, but only decisive policy action can unlock large-scale electrification.

Technical Summary

The Seminar on Decarbonization by Electrification of Local Vessels, a specialized seminar targeting local vessel electrification and decarbonization was held on 30 July 2024 at Hong Kong Productivity Council Building, focusing specifically on transforming Hong Kong's local shipping sector to support shipping decarbonization as well as the city's net-zero commitment. The event was co-organized by the Institute for the Environment at Hong Kong University of Science and Technology and Yun Lee Marine Group Holdings Limited, bringing together academic expertise and industry leadership from Hong Kong’s local maritime communities. 

This shipping electrification and decarbonization seminar was honoured to welcome distinguished representatives from across the maritime electrification value chain, demonstrating comprehensive stakeholder engagement in the sector's transition. We were privileged to have Mr. Frankie Yick Chi-ming, SBS, JP, Member of the Legislative Council of Hong Kong for the Transport Functional Constituency, deliver the opening address outlining government policy directions for local vessel decarbonization.

The technical presentations featured Contemporary Amperex Technology Co Ltd (CATL)'s senior executives Mr. Zhuang Zhanting and Mr. Weng Kangqiang, who shared cutting-edge marine battery systems and charging solutions specifically designed for local vessels; Mr. Huang Shengkai from Guangdong Zhongwei Composite Materials, who presented carbon fiber shipbuilding technologies enabling lightweight electric vessel construction; and Mr. Qin Xuanqing from Zhuhai Aoshenna Marine Engineering, who discussed small and medium-sized vessel electrification solutions. HKUST's research contribution came from Mr. Chen Jiajing, who presented Greater Bay Area emission reduction research and green corridor development potential. Infrastructure and energy perspectives were provided by CLP Power's Ms. Catherine Fok, who explored Hong Kong's maritime zero-carbon pathway, and DNV Energy Systems' Mr. Thomas Lo, who shared international electric vessel development trends and technical standards. The session concluded with a comprehensive panel discussion featuring industry operators including Yun Lee Marine Group's Mr. Wen Tsz Kit (event co-organizer) and Hong Kong & Kowloon Ferry's Captain Cheung Tai Kee, alongside green finance experts from Asia Carbon Institute and SGS Hong Kong, addressing practical implementation challenges for local vessel electrification. This focused assembly represented the essential stakeholder ecosystem required for Hong Kong's local vessel electrification advancement.

The discussions across both technical and policy panels underscored the critical importance of coordinated action between government, industry, and technology providers to accelerate Hong Kong's transition to electric shipping.

Electric vessel technology has reached commercial maturity with comprehensive solutions available for Hong Kong's local shipping sector. CATL demonstrated sophisticated marine battery systems offering 8-year lifecycle management, innovative leasing models, and Vessel-to-Grid (V2G) capabilities where 5,500 kWh marine batteries can serve dual purposes for grid stabilization. Combined with lightweight carbon fibre construction reducing vessel weight by 10-15% and diverse charging infrastructure from overnight AC to rapid DC systems, the technical foundation for Hong Kong's vessel electrification is established. Hong Kong's short routes, frequent sailings, and concentrated port infrastructure present optimal conditions for electric vessel deployment that could establish the territory as a global demonstration case.

Unanimous consensus emerged on the critical necessity of immediate government policy intervention to catalyze market transformation. Drawing from Norway's successful Maritime Battery Forum model established in 2013 and mainland China's comprehensive six-ministry policy framework that has accelerated provincial electrification programs, participants emphasized that while technology and financing mechanisms are ready, coordinated government action remains the essential catalyst. Small vessel operators, comprising 80% of Hong Kong's fleet, particularly stressed that commercial viability depends heavily on government subsidies and infrastructure support, as current programs primarily serve larger operators while leaving the majority of vessels underserved.

Financial mechanisms including green finance frameworks, carbon credit generation, and innovative business models can achieve 5-8 year payback periods, though infrastructure constraints require coordinated solutions based on comprehensive spatial demand mapping. Understanding the geographical distribution of charging demand across different vessel types, operational patterns, and route networks represents a critical prerequisite for strategic infrastructure planning and grid capacity allocation. Such demand mapping studies are essential to identify optimal charging station locations, determine electrical grid upgrade requirements, and coordinate utility infrastructure investments with vessel electrification timelines. However, immediate implementation barriers including insufficient electrical capacity at ferry piers, regulatory restrictions on battery systems, and physical limitations at key terminals require systematic infrastructure development with utility companies and government coordination to translate demand analysis into actionable deployment strategies.

The seminar concluded with clear implementation priorities: formation of a Hong Kong Maritime Battery Forum, development of end-to-end solutions encompassing vessels to charging infrastructure, and early government engagement to create integrated policy frameworks. International collaboration opportunities with Norway's decade-long experience and mainland China's world-leading battery technology offer accelerated learning pathways. Success depends on fostering dialogue among all stakeholders to develop comprehensive implementation plans that can position Hong Kong at the forefront of the maritime electrification revolution while addressing both large operators and the significant small vessel sector.

Roundtable Session: How to overcome obstacles for migration from oil to electric (如何克服油轉電過渡的障礙)

Prof. Christine Loh (HKUST) was the moderator of the Roundtable Session which addressed four major themes detailed as follows, ended with policy recommendations for Hong Kong Government.

Technical Challenges and Battery Solutions

1. Mr Zhanting Zhuang (Contemporary Amperex Technology Co Ltd, CATL) highlighted the superior capabilities of marine batteries over automotive systems. "Marine battery systems, such as those used in container ships, offer superior energy capacity and consistent performance over time, which is essential for reliable power supply to shore-side systems," he explained. He noted that marine batteries of 5500 kWh—equivalent to 100 Tesla EV battery systems—can maintain stable performance throughout their lifecycle, unlike automotive batteries which may experience variability.

2. Zhuang emphasized CATL's commitment to battery recycling, noting their investment in China's largest battery recycling company since 2015, which achieves recycling rates exceeding 95%. However, he acknowledged that "the oldest electric ships currently involved are only four years old, indicating that these batteries will still have a long period before entering into the recycling system."

Infrastructure Development and Government Support

3. Mr Tai Kee Cheung (Hong Kong and Kowloon Ferry Limited) expressed concerns about implementation challenges in Hong Kong, emphasizing the need for standardized battery systems similar to containerized models. He highlighted infrastructure limitations, noting that "electricity supply to Central would not be feasible in the next decade" according to Transport Department officials, and pointed to restrictions on installing charging stations at Central pier.

4. Mr Thomas Lo (DNV Energy System) provided international perspective, sharing that "from a technical perspective, there are no significant challenges left; rather, the remaining obstacles are largely institutional." He referenced Norway's successful experience from a decade ago and encouraged learning from their solutions.

5. Mr Alex Chan (Siemens-energy Co., Limited) stressed infrastructure gaps, highlighting challenges related to insufficient electricity supply at ferry piers in North Point and Kwun Tong due to existing electricity infrastructure limitations.

Business Models and Financing Solutions

6. Zhuang outlined CATL's exploration of innovative leasing models, which would allow shipowners to utilize batteries while collaborating with financial institutions. He proposed reference pricing for battery replacement after typical ship lifespans of eight years, anticipating that "battery costs will decrease over time, due to improved energy density and reduced production costs per unit of electricity."

7. Calvin Wong (SGS Hong Kong, China) emphasized sustainable finance frameworks, recommending development of "sustainable green finance framework" that includes adherence to green loan principles. He highlighted the Hong Kong government's green finance taxonomy introduced in May 2024 and the importance of understanding operational emissions index (OEI) calculations.

8. William Chan (Asia Carbon Institute) explained carbon asset creation, noting that "if a project can generate carbon credits that can be sold, it can help fund the project." However, he cautioned that government regulation of low-carbon emission vessels could affect carbon credit availability.

Future Research and Implementation Priorities

9. Looking ahead, participants identified critical success factors for electric vessel adoption. Mr Kangqiang Weng highlighted mainland China's government-driven approach since 2020, where six ministries jointly released policies to vigorously develop electrification, followed by provincial subsidy programs.

10. Multiple speakers emphasized the need for comprehensive government involvement. Catherine Fok (CLP Power Hong Kong Limited) proposed creating "robust end-to-end solution that encompasses everything from electric vessels to charging infrastructure and power supply," believing such comprehensive planning could serve as a significant driving force when presented to government or green finance entities.

11. Christine emphasized the essential role of early government participation and necessity of collaboration: "we are in the midst of a technological revolution, and government support is crucial for driving this change. We should think creatively about collaboration while fostering dialogue rather than immediate commitment, allowing all parties to learn and understand each other's perspectives.”
12. Christine concluded with a clear consensus: “The question is no longer whether electric ships will become mainstream, but how quickly Hong Kong can position itself at the forefront of this maritime revolution. While technical solutions already exist, institutional frameworks, infrastructure development, and innovative financing models remain critical for successful electric vessel implementation.”
13. The unanimous call for stronger government policy intervention, combined with innovative financing mechanisms and standardized technical solutions, highlighted that while the technology is ready, success depends on creating the right regulatory and economic framework. Participants noted that Hong Kong has a unique opportunity to become a regional leader in green shipping, particularly given the supportive policy environment in mainland China and the presence of world-leading battery technology companies willing to collaborate locally.

Program: (Chinese only)