Green Port Dues: The Environmental Ship Index (ESI)

The Environmental Ship Index program

Ports can implement voluntary programs to incentivize ship operators to green their ships. Green ship operators, in return, receive a benefit, such as a discount on port dues. An example is the Environmental Ship Index (ESI). The index was created by major ports in cooperation with the International Association of Ports and Harbors (IAPH) and has been fully integrated into the IAPH’s governance structure since 2020. ESI is administered by Green Award Foundation, a non-profit organisation that offers a certification and port incentive program for shipping.

The Environmental Ship Index portal enables ports and other interested parties to incentivize ships to use cleaner engines and fuels with preferential treatment offered either through discounts on port dues, bonuses or other benefits commensurate with a specified level of cleanliness.

ESI is a voluntary tool that includes a formula-based evaluation of vessels’ nitrogen oxide (NOx) and sulfur oxide (SOx) emissions. The calculation also rewards vessels that are equipped to use available onshore power and which demonstrate fuel efficiency improvements over time, reducing carbon dioxide (CO2) and particulate matter (PM) emissions. The ESI has become the established standard by which port authorities and maritime administrations incentivize ship owners and ship owners/operators to continuously improve the environmental performance of the fleets calling at their terminals. ESI has been recognised by the International Maritime Organisation (IMO) as the standard basis for port incentives for low- and zero-carbon ships.

Green Award Foundation administers and manages the more than 8,400-strong database of ships and 59 incentive providers already registered on the index. The strongest representation comes from the container shipping sector, with over half of the world fleet registered. Tankers (gas, chemical, and oil) are also well represented, with 28% of the world fleet. The focus is on growing the number of registered dry bulk and general cargo vessels as well as ro-ro and cruise vessels. Green Award is a global, independent, non-profit quality assurance organization with the primary task of certifying ship managers and vessels that go beyond the industry standards in terms of safety, quality, and environmental performance. The foundation works closely with maritime authorities and classification societies and provides data to Equasis (the database containing safety-related information on the world’s merchant fleet).

In March 2024, it was announced that the ESI is entering a new phase with revised and expanded modules and formulae, and the introduction of new GHG and innovation modules. By 2026, ESI’s revised and expanded offering will take into account a range of potential emissions, introduce a new GHG methodology, and reward innovation and application of zero-emissions techniques onboard vessels. The new ESI will also address global concerns about the environmental impact of vessels on marine life. For example, from 2026 ESI will offer a new option to reward the mitigation of underwater radiated noise. The revised format of ESI will better align with global regulatory changes, in particular at the IMO and EU.

While ports or other public authorities could, in principle, also decide to implement strict regulation on emission criteria for ships entering the port (i.e. dirty ships are not granted access), such access restrictions have only been implemented in a few ports around the world.