Leveraging Incentives To Lower Emissions

Haley Armstrong and Ethan Spira from AJW, Inc. explore how terminal operators can adapt as the energy transition unfolds.

Terminals play an integral role in connecting companies’ supply chains. Operators must understand their customers’ emissions reduction goals to ensure the terminal is meeting the customer’s needs. While motivations to reduce emissions may vary from company to company – like customer preference, investor pressure, corporate missions, or regulatory requirements – developing emissions reduction strategies within your company and across your supply chains is increasingly becoming an expected business practice.

Importantly, most terminals do not operate in a purely domestic market, as global customers own or purchase the liquid commodities that are stored or passed through the facilities. This global context means that terminals must provide services that meet the needs of today while planning and investing to meet the demands of tomorrow for customers on their own doorstep and for customers from economies that may require or prefer a decarbonised value chain.

A New Era Of Financial Support For Decarbonisation

The funding from the US Infrastructure Investment and Jobs Act (IIJA) and the Inflation Reduction Act (IRA) can help support terminals as they aim to meet industry needs or preferences. The passage of the IIJA and the IRA marked a significant inflection point for the energy transition. These policies present key funding opportunities and programmes for numerous sectors, including the liquid terminal industry and the markets that those terminals serve. Now is the time for the terminal industry to assess its potential engagement in the energy transition and take advantage of the support mechanisms available.

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