A pay-as-you-use business model for the greening of shipping

Abstract

Driven by the latest regulatory development in shipping, the maritime industry shows coupled commercial interest from technology providers and shipowners (or operators) to promote and operate greener ships. Acknowledging, that green technologies come with a premium, the missing part of the equation is no other than a feasible and affordable source of finance to bridge the gap. As access to capital from traditional sources becomes either scarce or less attractive, alternative methods should be devised. Alternative financial schemes that promote greening require further research and development. In this work, the pay-as-you-use (PayU) is presented. PayU aims at finding an optimum solution for both shipowners and technology providers, considering operational leasing and the outcome-based contract (OBC) concepts and applications. Leasing and OBC approaches are widely applied in other industries and show strategic fit and potential application for the greening of shipping. The model results in an optimum curve of NPV/NAL as a decision support tool for negotiation and greening technology selection purposes.