Allard Castelein: Forging a path for future-proof ports
Allard Castelein, President and CEO of Port of Rotterdam, talks to Leadership Insights about the complex web of stakeholder projects underway to prepare Europe’s busiest container port for a digitalised, decarbonised future.
5 October 2022
Q. You’ve been in your role for nearly 9 years. What do you see as major achievements during this time?
Remaining customer focused has been key. We’ve seen investments in a rich portfolio of activities, whether related to the container shipping industry or the energy transition or the digitalisation of the logistics chain. And we have moved from being a somewhat conservative custodian of a port to an organisation that embraces disruption as opportunity, and that has become a strong advocate of collaboration between public and private to pursue those opportunities.
Q. You mention the collaboration between public and private in ports, how do you mesh what may often be conflicting expectations on both sides?
This is hard work fuelled by ongoing emerging insights. On many of the journeys we’ve embarked upon, we did not know all the answers when we started. So we’ve accepted the fact that by close interaction and iterations between stakeholders we’ve developed our way forward, but with a vision of what our journey would ultimately have to lead to.
Part and parcel of that process is to address the tensions that may emerge. You have to take the different perspectives seriously and work your way through the various issues, be it in Brussels or The Hague, with private enterprises or in the broader stakeholder arena.
Q. What are your strategic plans to ensure that the Port of Rotterdam is ready for the green energy transition?
There’s no quick fix, so we’re collaborating with various industries, and we are developing several pathways. This will ensure that we have supplies of green energy sources, that we have carbon capture and storage, that we use residual heat, that we build a circular economy, that we use sustainable biomass to produce the necessary products and that we help the logistics sector to decarbonise. We have a full suite of activities addressing the various opportunities and needs associated with the energy transition.
We see that the shipping industry has a lot of enthusiasm to become more transparent related to their emissions profile. In Rotterdam we seek to collaborate with them, to show that via Rotterdam their footprint will be the minimal that they could possibly achieve because we will supply green fuels, or we will have the green corridor approach with Singapore, or we ensure you have the least waste through the digital approaches to the logistics supply chain, or because our hinterland connections are most efficient.
Q. What has driven your move tointroduce a large-scale hydrogen network across the port complex to become a hub for production and import?
Rotterdam is the major energy hub of northwest Europe. Some 13% of all of Europe’s energy is transported through Rotterdam. We should produce as much green hydrogen as we can in the area, and in the case of the Netherlands and Germany that will be through offshore wind farms. But, Northwest Europe will always be a net importer of energy. The first major wind farm is already connected to the electricity grid in Rotterdam, so green electrons are already arriving here.
Financial investment decisions have been made to build the first large-scale 200MW electrolyser and there are four others in various stages of development that have already made ‘block bookings’ for premises and land. By 2030 we expect to have more than 1GW of installed capacity operational.
Because of the need for access to green hydrogen across north-western Europe, we will seek to connect the port area all the way to the main industry clusters in the southeast of the Netherlands, as well as Germany’s North Rhine-Westphalia. We’re planning a large pipeline bundle where we will deliver hydrogen and, on the way back, take CO2 for storage in the depleted gas fields in the North Sea.
By 2050 we would expect to be shipping and dealing with some 20 million tonnes of hydrogen serving the Rotterdam area and other industrial clusters within our reach.
Q. How does shore power factor into your green transformation plans?
Shore power will not make a huge impact on the climate, but from the perspective of air quality in the immediate environment it is going to be vital, and part of our license to operate and grow.
We’ve said, together with Hamburg and Antwerp, that we aspire to achieve shore power for the container sector and some smaller sectors by 2028, two years earlier than European legislation requires. There are resource elements and capacity issues – you don’t want to have a cruise vessel in the city centre using shore power and creating a blackout – so we’ve got to do our homework. But we are convinced it will play a major role in port facilities.
Q. Are you also focused on considerations for a just transition, taking into account the impact of change on port communities, workers and minority stakeholders?
As a company we have embraced and taken dear to our heart all of the seventeen UN Sustainable Development Goals, which represents stakeholder societies, gender equality, education, healthy environments, and safe operations. And every CEO of a liner I engage with on these issues has a similar approach to the challenges and a similar commitment to living up to those goals.
We opened up for sailors stricken by COVID, on board vessels that from a cargo perspective didn’t need to call on the Port of Rotterdam. We provided vaccines free of charge to crew members of visiting ships. And we will continue to work with all the people that make up this industry to ensure that the benefits are allocated appropriately and that we create prosperity through investments, job creation and a clean and safe environment without discrimination.
Q. Supply chain issues continue to disrupt the maritime and wider transport sectors. How are you continuing to build up resilience and ease congestion issues at the Port of Rotterdam?
COVID forced us to call for a value-chain wide coalition, with representatives from each and every element, from terminal operators to pilots to tugboats to inland shippers to depots to customers. During week one of the COVID lockdown we said that we were going to need to help each other to ensure that the value chain was as strong as it could possibly be.
The beautiful thing was that all participants in those meetings appreciated their broader responsibility beyond their own element of the value chain. And we’ve continued that dialogue from COVID through the Ukraine war. In the midst of that process, the same group managed to tackle the issues associated with the Ever Given in the Suez Canal. And we moved on to saying this is not only about the Ukraine crisis and so on, but that we are stretching the limits of the labour force. I think we may have to address these issues for quite some time to come until we’re in a more flexible situation with less stresses and strains in the system.
Q. How do your plans on digitization feed into plans to become more resilient to supply chain disruption?
The example I often give is that it would make sense for liners to have an appreciation of their optimum sailing time, so that they can arrive at a port at exactly that time when there’s the minimal chance of delay so there’s no need to burn fuel whilst at anchorage.
The same would apply regarding all port processes. Just over a month ago we launched a project to set up a trusted trade lane and digital corridor with Singapore. That will enable us to exchange information in the most efficient way, readily available online in real time. So, no double checks are needed. If one entity does all the checks and balances, then the other part of the equation should be free and comfortable to receive the goods. Ultimately, digitalisation will give us better knowledge, better information, more efficiency, less waste, less dwell time and thus enhance the full value chain.