Aside from the current low water emergency, there are many other challenges facing inland waterways.
In an interview with AJOT, American Waterways Operators (AWO) President Jennifer Carpenter outlined some of the hurdles, including the much-debated application of Jones Act waivers.
Carpenter praised the actions by Congress and the Biden administration to thwart attempts to undermine U.S. build and U.S. manning requirements as provided under the Jones Act to be reduced, saying, “I want to thank Congress and the Biden Administration who have taken a very firm stance against unnecessary waivers of the Jones Act. So, Congress in the last National Defense Authorization Act that passed in 2021 put guardrails around new Jones Act waivers which limit them in duration, and require more transparency which makes even more explicit the need for a clear National Defense justification. Meanwhile, the Biden Administration has held the line against Jones Act waivers despite considerable pressure. There have been opportunistic efforts to request waivers due to the global instability with the Russian invasion of Ukraine and the rise of energy prices: My responses are: Don’t do it…It’s not legal and it’s not needed.”
Offshore Wind Industry
The Jones Act stands to be a bigger issue in the near future with the advent of offshore wind projects. As Carpenter points out there is potential for new jobs and vessel operation business for the growing U.S. offshore wind industry: “I am the Vice President of the American Maritime Partnership which is the Jones Act Coalition. I also chair AMP’s offshore wind committee and I am really passionate about this because there is so much opportunity for American maritime in offshore wind. This is also a great opportunity for energy independence and greenhouse gas emission reductions … We are building up an industry from the ground up. It did not exist before. Sometimes we hear: ‘Why can’t we do things the way we did in Europe?’ and the answer is because this isn’t Europe. The question should be how we can meet policy objectives in compliance with U.S. law. Developers are engaged in partnerships with domestic maritime, so you’ve got DEME Offshore partnering with Foss Maritime on the Vineyard Wind project (offshore Massachusetts). Maersk and Kirby have to work together to build out Empire Wind (offshore New York State). Kirby is the largest U.S. tank barge, operator. They didn’t have a wind division. Now they do. That tells you something about the opportunity for American maritime.”
Carpenter says she sees new opportunities developing as a result of Dominion Energy’s Coastal Virginia Offshore Wind (CVOW) project. Dominion says that when fully constructed in 2026, the CVOW project will “deliver up to 8.8 million megawatts per year of clean, renewable energy to the grid, powering up to 660,000 Virginia homes. Providing this power with wind energy will avoid as much as 5 million tons of carbon dioxide emissions annually—the equivalent of planting more than 80 million trees.”
Carpenter notes: “In my state of Virginia, you have Dominion Energy ordering a U.S. flagged wind turbine installation vessel at a U.S. shipyard. That’s the Keppel Shipyard in Brownsville, Texas. Dominion seized the business case for that. That’s fantastic. There’s money to be made here, I’m really bullish. Holding out for a Jones Act waiver is a loser… That dog doesn’t hunt. Recognize what the rules are and talk to the people who can meet your needs.”
Carpenter says shipbuilding is a critical industry: “It is so important to our economic security. Do we want to build ships in China? That’s a ridiculous question in the current environment. We need the same attitude of priority and urgency contracting for workers in the shipbuilding industry as we are looking to attract workers in the maritime industry. I feel very good about the capability of U.S. shipyards to do what needs to be done to build out the offshore wind. This is very much in the U.S. wheelhouse for feeder barges, ATBs (Articulated Tug Barges), and tugs, to move floating wind components. We’re good at that in the U.S. … These are all things we have done in the oil and gas sector. U.S. shipyards have long and good experience with these types of vessels and we can transfer that expertise to the offshore wind industry.”
New Market Opportunities for Inland and Coastal Vessels
There is more to be done to fully use the potential of the waterways and inland rivers to move cargo “in an environmental and sustainable way to get freight off crowded highways and away from population centers.”
She says: “Shippers’ experience over the last couple of years during the pandemic and supply chain disruptions and challenges with other modes, have people looking with new eyes at the potential of the waterways. I think that’s fantastic! Of course, there is work to be done to ensure you have shoreside infrastructure support. So maybe it’s worth shippers doing a little upfront work to ensure that they have alternatives in transportation…”
She notes that when the Colonial Pipeline was the victim of a ransomware attack in May 2021, it infected some of the pipeline’s digital systems, shutting them down for several days: “When the Colonial Pipeline was down, you had inland barges who could move fuel to Nashville, Evansville, Illinois, and Paducah, Kentucky because there were rivers there and that kept people able to fuel their cars. That’s an example of how taking full advantage of our waterways gives us resiliency and it allows us to deal with transportation and logistics challenges, whether they are natural disasters, a pandemic, or some criminal act…”
She added: “Let’s take advantage of funds provided in the Infrastructure Investment and Jobs Act to invest in shoreside port infrastructure. There’s a huge opportunity there.”
Carpenter sees progress in the waterways industry reducing emissions but cites the importance of U.S. Department of Energy funding and support from the U.S. Environmental Protection Agency (EPA): “As we talk about sustainability, and lower zero carbon fuel there is an opportunity that the Department of Energy program for advanced vehicles and technology can help the industry. Vessel owners, and not just manufacturers of electric motor vehicles, can take advantage of funding opportunities to test innovative technologies in a maritime environment. Whether utilizing hydrogen or methanol fuel alternatives, testing these would be extremely constructive. Also, the EPA has a program that has been funded for engine repowering. There is a need to expand those programs because there is a lot of innovation out there. Being able to really implement new carbon reduction technologies at scale is going to require a lot of money. So, more funding for these programs enables vessel owners as well as ports to get out and install cleaner technology. Robustly funding these programs would be a positive next step. AWO has got a CEO-level task force looking at decarbonization and it is going to be meeting later this Fall one of the questions that were put out to the group is to help us put a little more clarity around our public policy agenda and what else would help. So, we may have some more asks when we dig a little deeper into this.”
Prospects for 2022
Carpenter says the industry’s economic fortunes are improving: “It’s a lot better than 2021, and a lot better than 2020. I will say that the glass is half full. There has been a significant demand for marine transportation and that’s a good thing. The caveat is our workforce challenges you’ve got to have the people to take advantage of these opportunities. Also, everything is more expensive from steel, to paint, to engine components. And those are challenges. But I’m bullish on the future of this industry.”