Last year, Beluga Shipping discovered that there’s money in global warming.
Beluga is a German firm that specializes in “super heavy lift” transport. Its vessels are equipped with massive cranes, allowing it to load and unload massive objects, like multi-ton propeller blades for wind turbines. It is an enormously expensive business, but last summer, Beluga executives hit upon an interesting way to save money: Shipping freight over a melting Arctic.
Beluga had received contracts to send materials on a sprawling trip that would begin in Ulsan, South Korea, head north and west to the Russian port city of Archangelsk—located near the border with Finland—and wind up in Nigeria. Normally, this route requires Beluga’s ships to navigatea 11,000-mile route through the Suez Canal. But in 2008, executives for Beluga Shipping decided that global warming had eroded the Arctic’s summer sea ice significantly enough that their ships could travel the Northeast Passage [PDF] along the north coast of Russia. Previously,a cargo ship could only safely navigate that route if an icebreaker went ahead, smashing a route through thick ice.
Now, a warming climate had—for six to eight weeks beginning in July—transformed much of the route into mostly open water, studded with ice floes that the Beluga ships could navigate. So its executives got permission from the Russian government to travel along the coast, paid a transit fee of “a comparably moderate five-digit figure,” and sent the ships on their way. Four months later, they’d finished the trip. Compared to the old Suez Canal journey, this shorter route saved an enormous pile of money: It cost $300,000 less per ship in lower fuel and bunker costs. Global warming had boosted the company’s revenues by more than half a million dollars in one year alone.
When I interviewed Beluga CEO Niels Stolberg via email this spring, he said he envisions using the Northeast Passage regularly. Indeed, he’s planning on another trip this summer. He said that since the shorter passage requires generating far less C02, it’s “greener”; it’s also more ironic, since it was high concentrations of C02 that helped melt the route in the first place.
“I am convinced,” Stolberg added, “that the Arctic will become an area of quite regular sea traffic at least during summer.”
If you looked merely at the realm of politics, it would be easy to believe that the question “Is climate change really happening?” is still unresolved. In recent months, skeptics have attacked climate science with renewed vigor. Doubters seized on “Climategate“—leaked emails from bickering atmospheric scientists—to argue that the evidence in favor of warming is being cooked. Other skeptics unearthed shoddy parts of the Intergovernmental Panel on Climate Change’s main report, such as the fact that it cited non-peer-reviewed work by an activist group when it predicted that the Himalayan glaciers would melt by 2035. And all along, conservative politicians have hissingly denounced global warming as a shady liberal scheme: Senator James Inhofe of Oklahoma has famously called it “the greatest hoax ever perpetrated on the American people.” These attacks appear to be working. A spring Gallup study found that Americans’ concern over global warming peaked two years ago, and has steadily declined since.
But there’s one area where doubt hasn’t grown—and where, indeed, people are more and more certain that climate change is not only real, but imminent: The world of industry and commerce.
Companies, of course, exist to make money. That’s often what makes them seem so rapacious. But their primal greed also plants them inevitably in the “reality-based community.” If a firm’s bottom line is going to be affected by a changing climate—say, when its supply chains dry up because of drought, or its real estate gets swamped by sea-level rise—then it doesn’t particularly matter whether or not the executives want to believe in climate change. Railing at scientists for massaging tree-ring statistics won’t stop the globe from warming if the globe is actually, you know, warming. The same applies in reverse, as the folks at Beluga Shipping adroitly realized: If there are serious bucks to be made from the changing climate, then the free market is almost certainly going to jump at it.
More stories in this series:
About a decade ago, Miguel Torres planted 104 hectares of pinot noir grapes in the Spanish Pyrenees, 3,300 feet above sea level. It’s cold up there and not much good for grapes — at least not these days. But Torres, …
If Congress and the president fail to tackle global warming, can courts step in? Can federal judges allow people struggling with the losses of global warming to sue polluters directly? The idea may at first seem crazy. In a legal …
Will an SEC ruling convert short-term greed into long-term sustainability? [UPDATED WITH TRANSCRIPT]
I know. I know. Securities and Exchange Commission: zzzzzzzzzzzzzzzzzzzzzzz. But the SEC did something sort of landmark last January: in a 3-2 vote, commissioners approved guidelines that urge companies to regularly disclose climate change-related risks (and opportunities) to investors. If …
Get Grist in your inbox