Virgin Voyages may be relatively new to the oceans, having launched its first cruise ship Scarlet Lady in 2021, but the brand packs a punch globally and has no doubts where it is going with its sustainability agenda.
When it comes to sustainability and social impact, first and foremost it is about building on the strong foundations that we have as a brand,” says Jill Stoneberg, senior director social impact and sustainability. “We like to talk about our purpose as an organisation. In a nutshell, it’s about creating positive change for people on the planet. Our strategy is pretty clearly defined.”
For the cruise industry to get to net zero by 2050, it requires a full portfolio of options. “Behind the scenes we’re working on how we can achieve that goal, but there’s so much to do to get there,” says Stoneberg. “Ideally, we’d like to set interim carbon reduction targets, for example for 2030 and 2040, on that road.”
While many cruise lines are designing new ships powered by alternative energy sources, such as fuel cells, or planning for future fuels, Virgin is taking a different route for its four ships.
“Because decarbonisation has to happen at the scale and pace required, we’re solely focused on advanced waste-based drop-in fuels (i.e. second-generation biofuels) that can be used on our engines today,” says Stoneberg.
In autumn 2022, Virgin entered into partnerships with three sustainable marine fuel providers: Argent Energy, GoodFuels and Twelve. “Our focus is on advancing those partnerships and ensuring that we will have access to that fuel as it becomes more readily available,” says Stoneberg. “Drop-in fuels do exist today but not on the commercial scale that is needed to provide the fuel on a regular, consistent basis and they aren’t affordable right now.
“The behind-the-scenes work that is taking place is really on stakeholder engagement, talking to policymakers and working out that ideal state of what needs to happen for those fuels to meet robust sustainability standards and be available in the locations where we operate our ships.”
In September 2022, Virgin partnered with independent expert organisation, the Roundtable on Sustainable Biomaterials (RSB). “We see it as a key stakeholder because it’s going to ensure that any drop-in fuels we use meet robust sustainability standards and do not have any unintended consequences, such as deforestation,” says Stoneberg.
“We’re not talking about first-generation biofuels. We’re talking about advanced waste-based fuels that don’t have any unintended consequences when it comes to land use, competing with food sources, or social issues associated with the feedstocks. RSB wants to ensure we’re leveraging best practices from other industries like aviation and we’re using those same high standards for our future plans.”
All three fuel companies Virgin has partnered with offer a drop-in sustainable fuel solution. Both Argent Energy and GoodFuels are already supplying those fuels in the marine sector.
“They have a real product which can be used on cruise ships,” says Stoneberg. “It’s about the infrastructure being in place to support access to those fuels, the right policies being in place and the fuel being affordable in the destinations we’re visiting.”
Both companies are active in the Netherlands where the right policies and incentives are already in place, but this is not currently the case elsewhere in the world. Hence Virgin is exploring how this could be extended into Europe, which has recently introduced the Fit for 55 plan, as well as how it could work for similar fuels that would be acceptable in the USA.
To achieve this, Stoneberg and her peers are in no doubt that: “We need radical collaboration with all stakeholders – our peers, the ports and the major oil companies – not just sustainable fuel providers. It involves a lot of partnerships, even including the wider shipping industry. A lot of those conversations are taking place, a lot of change needs to happen very quickly.”
The types of drop-in fuel being considered include those made from agricultural waste, which could derive from various waste feedstocks, for example the piths of fruit left over from harvesting. It could also come from municipal waste or sewage – in other words, giving a second life to carbon that already exists in the world above ground.
Although these fuels are now significantly more expensive than fossil fuels, this will change especially in Europe. “Regulations are coming into place, where you will pay a price for carbon as well as a price for not hitting the regulatory mandate to use a certain percentage of your fuel from renewable energy-based sources,” says Stoneberg. “What’s interesting is that the market is showing that while sustainable marine fuels are not at competitive prices today, the regulations are shaping up with incentives and penalties that should encourage the market to shift.”
One of the positive surprises Stoneberg found when starting this work was the overwhelming number of responses from suppliers to Virgin’s request. “There are more out there than we thought which was an encouraging sign,” she says. “Most of the time with this type of work, the solutions don’t exist unless you ask for them to be there. Some of the suppliers are in a position to scale up to meet the demand if the right policies are implemented in the relevant locations.”
While Virgin may not be one of the big cruise players, it does have a powerful voice. “As the Virgin brand, we’re expected to lead on climate and to be innovative, so we want to help the industry get to where it needs to by bringing the right partners to the table,” says Stoneberg. “Sustainability is a business imperative that needs to be kept top of mind. We all applaud each other for what each is doing.”
Noting that the general stance on sustainability has changed, Stoneberg says: “Covid really increased people’s awareness – brands doubled down on sustainability and more governments made commitments, which has significantly changed the conversation and the focus for businesses.
“If you’re not talking about decarbonisation right now, there is not a clear future for your company. The business value for environment, social and governance strategies (ESG) has been recognised. Some markets have demonstrated that when you have ESG measures in place, you’re considered a less risky business. You’re planning for the future, so your investors are happier and you’re demonstrating alignment with issues your employees and customers care about so your returns are higher. This proves the business case for sustainability and ESG, whereas it wasn’t as clear before.”
There is no doubting Virgin’s commitment to the green agenda. And for Stoneberg, who started her career in renewable energy and has worked in the sustainability space for the past 20 years, “things have changed drastically”. For example, she says: “there are now some places in the USA where renewable energy is cheaper than fossil fuels”. Now that is progress.
This article was first published in the Spring/Summer 2023 issue of Cruise & Ferry Review. All information was correct at the time of printing, but may since have changed. Subscribe to Cruise & Ferry Review for FREE here to get the next issue delivered directly to your inbox or your door.