Mitsui & Co.

Global Strategic Studies Institute Monthly Report September 2019

MARITIME AUTONOMOUS SURFACE SHIPS：DEVELOPMENT TRENDS AND PROSPECTS

— HOW DIGITALIZATION DRIVIES CHANGES IN MARITIME INDUSTRY—

Koji Wariishi
Consumer Innovation Dept., Technology & Innovation Studies Div.
Mitsui & Co. Global Strategic Studies Institute

SUMMARY

 With the digitalization advancement in the maritime industry, the development of autonomous ships is
making headway, especially in Europe, and initiatives have been launched in Japan as well.

 Autonomous ships not only save on labor and enhance safety, but also bring change to the industry
structure and influence the entire maritime transportation infrastructure.

 “Autonomous ship integrators” are expected to emerge to perform the role of highly integrating maritime-
related sectors, including shipbuilding, marine transportation, port operations, and warehousing.

Interest in autonomous ships is growing rapidly because the high levels of safety and efficiency that can be
attained by such ships are thought to have the potential to provide solutions for problems in the maritime industry,
such as for the prevention of marine accidents and the improvement of the work environment. Autonomous
ships are scheduled to be put into practical use as coastal vessels in some areas overseas from as early as the
first half of the 2020s. As ships become equipped with increasingly advanced automation functions, beginning
with ships using IoT, fully unmanned autonomous ships are also expected to be realized in the future.

This report presents details of development trends for large-scale autonomous ships and describes the
accompanying structural changes in the maritime industry.

1. OVERVIEW OF MARITIME AUTONOMOUS SURFACE SHIPS

1-1. What is an Autonomous Ship?

Autonomous ships are highly automated (autonomous) or remotely controlled ships and their operating system.
These ships use the latest technology, such as IoT, ICT, data analysis technology and onshore
monitoring/control bases connected by broadband communication, and automatically operate a part of or all of
onboard tasks associated with ship operations, such as observing its surroundings (lookout), equipment status
monitoring, ship maneuvering, engine control, cargo management/loading, docking and undocking, and others.

Autonomous ships are said to contribute to improving the safety and efficiency of maritime transportation, the
work environment and workplace attractiveness for seafarers, and increasing the competitiveness of maritime
industry, such as marine transportation, shipbuilding, and other maritime business.

At the 99th meeting of the Maritime Safety Committee (MSC) of the International Maritime Organization (IMO)
held in May 2018, four degrees of automation were presented as provisional definitions of autonomous ships
(Figure 1).

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Figure 1: IMO definitions of autonomous ships (provisional)

Ships with automated processes and Seafarers are on board to operate the ship.
Degree 1
decision support Some operations may be automated.
The ship is controlled and operated from
Remotely controlled ship with seafarers on another location, but seafarers are on board.
Degree 2
board

The ship is controlled and operated from

Remotely controlled ship without seafarers another location.
Degree 3
on board
There are no seafarers on board.
The operating system of the ship is able to
Degree 4 Fully autonomous ship make decisions and determine actions by
itself.
Source: Compiled by MGSSI based on IMO press briefing, "IMO Takes First Steps to Address
Autonomous Ships" (May 2018)

In addition, Lloyd’s Register of Shipping (UK) has proposed more specific definitions than the IMO by presenting
a system for classifying the autonomous level (AL) from Level 0 to Level 6, taking into account the degree of
each advanced function, the location where assistant function is provided, and the degree of human involvement
(Figure 2).

Figure 2: Autonomy levels proposed by Lloyd's Register of Shipping (UK)

Autonomy Level (AL) Details
Manual - No
AL0 ―
autonomous function
All actions at the ship level are taken by a human operator, but a decision
On-ship decision
AL1 support tool can present options or otherwise influence the actions chosen,
support
for example DP Capability plots and route planning.
All actions at the ship level taken by human operator on board the vessel,
but decision support tool can present options or otherwise influence the
On and off-ship decision
AL2 actions chosen. Data may be provided by systems on or off the ship, for
support
example DP capability plots, OEM configuration recommendations, weather
routing.
Decisions and actions at the ship level are performed autonomously
"Active" human in the with human supervision. High- impact decisions are implemented in a
AL3
loop way to give human operators the opportunity to intercede and override
them. Data may be provided by systems on or off the ship.
Decisions and actions are performed autonomously with human
Human on the loop –
AL4 supervision. High impact decisions are implemented in a way to give
operator/supervisory
human operators the opportunity to intercede and over-ride them.

Fully autonomous (& Unsupervised or rarely supervised operation where decisions are made
AL5
rarely supervised) and actioned by the system, i.e. impact is at the total ship level.

Fully autonomous (& Unsupervised operation where decisions are made and actioned by the
AL6
with no supervision) system, i.e. impact is at the total ship level.

Source: Compiled by MGSSI based on a report by Lloyd's Register of Shipping (UK), "Autonomous Shipping 2019 and
Beyond" (January 2019), and a Japanese-language report by Japan's Ministry of Land, Infrastructure, Transport and
Tourism, "Challenges and Direction of Initiatives for Autonomous Ships" (December 2017).

Unlike automobiles, the autonomous ships are expected to have various kinds of automation because multiple
crew members are responsible for many tasks other than ship handling, such as engine maintenance and cargo
monitoring and even if only ship handling is automated, a fully unmanned autonomous ship cannot be realized.

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1-2. What’s Behind Expectations for Autonomous ships

According to the Japan Coast Guard, the number of maritime accidents has been decreasing in recent years,
but approximately 80% of these accidents are caused by human factors (inappropriate maneuvering,
inadequate lookout, etc.) (Figure 3). Also, according to the “Annual Overview of Marine Casualties and Incidents
2018” published by the European Maritime Safety Agency, 57.8% of accidents were attributable to human
factors, illustrating a similar trend in other parts of the world. More advanced ship handling with the use of
sensors is expected to improve the reliability of maritime transportation and to help prevent marine accidents.

Figure 3: Causes of cargo ship accidents in Japan (2018)

Unavoidable event, force

majeure, 32 ships, 12%

Materials/Structures, 18 ships,
7%

Other human errors, 13 ships, 5%

Improper maneuvering,
Insufficient survey of waterways, 4 95 ships, 36%
ships, 1% Non-human
factors, 50
Inattentiveness to weather
conditions, 8 ships, 3%
Human factors, 217

Operator dozing, 9 ships, 3%

Inadequate confirmation of
ship position, 10 ships, 4%

Inadequate lookout, 58 ships,

Faulty engine handling, 20 ships, 7%
22%

Source: Compiled by MGSSI based on the Japan Coast Guard's report,

2018 Status and Countermeasures for Marine Accidents (April 2019, Japanese language)

In addition, it has been suggested that the steady increase in the volume of global marine transportation will
lead to a tight global market for seafarers in the future. In the case of coastal vessels, in particular, with the
aging of seafarers continuing to progress, automation and other means are expected to help improve the work
environment.

Amid such growing expectations, efforts toward the realization of autonomous ships are being boosted by wider
adoption of the automatic identification system (AIS) for tracking ships, the electronic chart display and
information system (ECDIS) for geographical charting, and other systems, along with the rapid advancement of
maritime broadband communications, IoT, AI, and big data processing technologies, etc.

2. STATUS OF INITIATIVES FOR AUTOMATED SHIPS: GLOBALLY AND IN JAPAN

2-1. Overseas Initiatives: Europe Takes the Lead

Europe is positioned at the forefront of efforts to realize autonomous ships. The main projects implemented so
far, and each company’s efforts for practical use, are summarized in Figure 4.

In Europe, Rolls-Royce and Kongsberg Maritime play major roles. Both companies are leading in the
development of autonomous ships by integrating existing ship technologies with new digital technologies, such
as for sensors and AI. Since Kongsberg Maritime completed the acquisition of Rolls-Royce Commercial Marine
in April 2019, the integration of the two companies that have been driving the development of autonomous ships
in Europe has been attracting attention.

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Figure 4: Europe's initiatives toward the development of autonomous ships

Projects with Industry-Government-Academia Collaboration (mostly in the conceptual stage)

 Implemented from 2012 to 2015.

MUNIN  With the support of the EU, the Fraunhofer Institute took the lead in
(Maritime Unmanned Navigation through Intelligence in developing the concept of unmanned vessels and conducting pilot
Network) programs.
 Announced the effect of improving fuel efficiency by 10% or more
and reducing the risk of collisions and sinking.
 Implemented from 2015 to 2018.

AAWA  Led by Rolls-Royce, with the support of the government of Finland.

(Advanced Autonomous Waterborne Applications
Initiative)  Examined legal regulations and technical elements necessary for
the realization of autonomous ships, and conducted research based
on conceptual studies.
Efforts by Companies (primarily efforts toward practical applications)
 Unmanned electric container ship "Yara Birkeland" scheduled to be
Yara International (major Norwegian fertilizer maker) put into service in 2022. Yara Birkeland was developed by Kongsberg
and Kongsberg Maritime (maritime division of a Maritime.
Norwegian public-private enterprise)  Development is supported by a subsidy (approximately ¥1.8 billion)
from the Norwegian government.
 Under the SVAN (Safer Vessel with Autonomous Navigation)
Rolls-Royce Commercial Marine project, demonstrated autonomous operation of a freight and
(now a part of Kongsberg Maritime) passenger ferry (coastal ship) owned by Finland's Finferries in
December 2018
Wärtsilä  Demonstrated autonomous operation of a freight and passenger
(Finnish marine engine manufacturer) ferry (coastal ship) owned by Norway's Norled in November 2018
Source: Compiled by MGSSI based on corporate and project press releases, including for MUNIN and AAWA

2-2. Efforts in Japan

Japan’s Ministry of Land, Infrastructure, Transport and Tourism has been holding meetings for the Maritime
Innovation Subcommittee since February 2016 to promote a productivity revolution in the maritime industry.
Among the subcommittee’s objectives, the autonomous ship is positioned as one of priority policy measures. In
addition, the industry is also pursuing practical use, and the main initiatives are outlined in Figure 5.

2-3. Projections for Realization: Schedule and Level of Autonomy

According to the Nippon Foundation's report entitled, "Future 2040 — The Future of Japan Created by
Unmanned ships", issued in April 2019, assuming that ships to be newly built in 2040 are mainly expected to
be unmanned, and that 50% of domestic ships will be unmanned, the economic effect of unmanned ships is
estimated at approximately ¥1 trillion in 2040.

Although efforts by various countries to realize autonomous ships are gaining momentum, it is expected that
pilot projects and the introduction of such ships will proceed gradually in accordance with technological
developments and needs. Based on various roadmaps announced by the Japanese government and industry,
the expected schedule for realization and levels of autonomy are summarized in Figure 6.

The estimated schedule described in the figure is for the realization of autonomous oceangoing ships, which
are said to face the highest hurdles for practical use.1

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Small radio-controlled ships and military ships with a total tonnage of less than 20 tons for oceanographic surveys and other
applications have already been put into practical use. For coastal ships, the time required to reach realization is expected to be shorter.

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Figure 5: Japan's initiatives toward the development of autonomous ships

Government Initiatives
 Announced at the 7th Maritime Innovation Subcommittee in June 2018 to promote
advanced technology development and demonstrations, take a leading role in the
development of international standards and regulations, and achieve practical application of
autonomously operated ships by 2025. Positioned autonomous ships as a priority goal
alongside "i-Shipping (Note 1)" and "j-Ocean (Note 2)," and launched the following pilot
projects:
・ Demonstration of automatic ship handling functions: Oshima Shipbuilding, MHI Marine
Engineering, others.
Ministry of Land, Infrastructure, ・Demonstration of remote maneuvering functions: NYK, MTI, others.
Transport and Tourism
・ Demonstration of automatic docking and undocking functions: Mitsui E&S Shipbuilding,
MOL, others.
 Established the Maritime Innovation Strategy Promotion Headquarters in October 2018.
Promoting efforts to realize autonomous ships by 2025 by conducting a comprehensive
and swift examination of specific measures for realizing maritime innovation.
 Strengthen efforts to realize autonomous ships by including initiatives for achieving
practical use of autonomous ships to enhance marine transportation in the Future
Investment Strategy 2018, which was announced in June 2018.
Industry Initiatives
 A research consortium comprised of MOL, Mitsui E&S Shipbuilding, and others started
developing the technological concept for an autonomous maritime transport system in
August 2017. The group is expected to develop the technology concept for highly
Mitsui O.S.K. Lines, Mitsui E&S autonomous ships, and formulate a development roadmap for the technologies necessary
Shipbuilding (marine for the realization of autonomously operated vessels.
transportation/shipbuilding)  In September 2018, MOL carried out a pilot project by installing Rolls-Royce's obstacle
recognition advisory system (IAS: Intelligent Awareness System) on its passenger ferry
"Sunflower."
 From June 2016, started a "study on collision risk judgement and the autonomous
operation of ships". Development of functions to facilitate assessment of the risk of collision
with other ships, remote maneuvering from land during emergencies, and development of
Nippon Yusen (marine
equipment to transform navigation instrument information into AR.
transportation)
 In July 2018, started development of a ship operations support system for coastal ships,
using AI as a core technology, and developed a system to reroute ships using AI in
congested waters around Japan. A demonstration in actual waters is planned for 2021.

 In April 2019, began development of an automatic navigation system for large merchant
Mitsui & Co. (trading ships in collaboration with ST Engineering, a major engineering company in Singapore,
company/cooperation with and Lloyd's Register of Shipping (UK). A test run was carried out in Singapore, one of the
overseas companies) most congested ports in the world.
 In June 2018, announced the "Guidelines for Concept Design of Automated
Operation/Autonomous Operation of Ships." The elements to be considered in the
conceptual design were compiled from the viewpoint of ensuring the safety of autonomous
ships.
Nippon Kaiji Kyokai - ClassNK  The purpose is to develop a conceptual design of an automatically operated ship based
(ship classification society) on appropriate and sufficient considerations given to safety, while giving the assumptions
that seafarers perform a wide variety of onboard work, and that autonomous ships are
studied based on various concepts, common basic elements that should be considered
regarding safety are clarified.
Note 1: i-Shipping: Initiatives to improve productivity in all phases, from ship development/design to construction,
and through to operations.
Note 2: j-Ocean: Initiatives to help Japan's maritime industry capture growth in the ocean development market.
Source: Compiled by MGSSI based on press releases issued by each company and the Ministry of Land,
Infrastructure, Transport and Tourism

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In the first stage, as the proof-of-concept phase for autonomous ships, issues related to autonomous ships are
identified, the development of necessary technologies are pursued, and the effects of introduction are evaluated.
In some cases, it may be possible to proceed to the practical use phase, such as for use in coastal ships and
in limited sea areas.

In the second stage, IoT ships, which is equipped with collecting and analyzing sensors data, and supporting
decision making such as route navigation and engine failure notification, will be implemented. It is assumed that
real-time monitoring of ships will improve maintenance and operational efficiency, and that the introduction of
operation support systems will lead to enhanced safety and help reduce the workload of crews.

In the third stage, ships equipped with automated functions will be implemented. These ships integrate onboard
equipment by communicating with each other, and will use advanced data analysis and AI technologies to
propose a concrete course of action to be taken by the crew. This stage is also expected to see the appearance
of systems for presenting information in an audiovisual format for seafarers to make decisions, as well as ships
with onboard equipment that can be directly controlled from land. However, it is assumed that sailors will still be
the final decision-makers at this stage.

In the fourth stage, ships equipped with advanced automated functions will be implemented. These ships will
be equipped with systems that function appropriately when docking and undocking, and even for various marine
traffic and weather conditions. The ships will have a high level of autonomy, and it is assumed that there will be
cases where the final decision-maker will not be a sailor.

3. CHALLENGES FOR REALIZATION

With progressive advancements in the study and development of autonomous ships, a number of challenges
have surfaced. The two main challenges at present are technological issues and regulatory issues.

3-1. Technological Challenges

(1) Basic Infrastructure to Realize Autonomous Ships: Ship-to-Shore Communications Infrastructure

In order to realize an autonomous ship, a real-time information gathering from its surroundings are mandatory, and
communications between the ship and land must be broadband and low-cost. Moreover, in order to provide stable
and efficient support from land, such as for remote maneuvering, low-latency communication is also important.

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(2) Technologies for Ship Automation: Obstacle Detection and Collision Avoidance

One of the challenges toward the realization of an autonomous ship is the development of highly accurate
sensors that will allow an autonomous ship to detect obstacles at sea. Navigation radars have already been in
practical use, but autonomous ships still need a technology that enables observation of the surrounding
environment with greater precision across longer distances, even in the face of severe sea conditions. In
addition to radar, cameras and LIDAR developed in the automotive industry are being studied for this use, and
the specific functionalities of various sensors need to be effectively combined to achieve sensor fusion.

Other requirements include the development of advanced algorithms (AI for autonomous ships) to avoid collision
avoidance and safe navigation after detecting obstacles, and the compilation of maritime big data in order to
develop such an AI for automated ships. Furthermore, high-precision positioning technology and high-
performance rudder control are also required for more precise maneuvering when docking and undocking.

(3) Technologies for Fully Unmanned Operation: Automation and Robotics Technologies

In order to realize a fully unmanned autonomous ship, work that has been handled manually must be replaced
with automation or other mechanisms. Such work includes a wide variety of operations in the engine room and
deck section, as well as operations on land, such as towing. For example, in the engine room, seafarers currently
operate the ship while monitoring and maintaining the engine, suggesting the need for maintenance automation
or maintenance-free power.

3-2. Regulatory Challenges

As existing legal systems related to ships are based on the premise that the ship is a “manned ship” with a
captain or other seamen on board, for remotely operated ships and unmanned ships, the following international
treaties and related legislative systems should be revised:

 The United Nations Convention on the Law of the Sea (UNCLOS): An agreement defining the rights and
obligations of navigating ships. If an automated ship falls under the description of “vessel” as defined by
the convention, the provisions will apply to such ships.

 The International Convention for the Safety of Life at Sea (SOLAS Convention): A convention that
ensures hardware safety by setting standards for ship structures, lifesaving equipment, radio equipment,
and other fixtures. Equipment requirements for autonomous ships will need to be considered.

 The International Convention on Standards of Training, Certification, and Watchkeeping for Seafarers
(STCW Convention): A convention on soft-side requirements, such as crew qualification and training.
How the stipulations of this convention would apply to autonomous ships without a crew will need to be
addressed.

 The Convention on International Regulations for the Prevention of Collisions at Sea (COLREG
Convention): A convention that establishes navigation rules to prevent the collision of ships at sea (Sea
Road Traffic Act). Application to autonomous ships needs to be examined.

 The International Convention for the Prevention of Pollution from Ships, 1973 as modified by the Protocol
of 1978, (73/78 MARPOL Convention): A comprehensive convention to prevent marine pollution. It is
necessary to consider the enforcement of the obligations of this convention on autonomous ships without
a crew.

4. STRUCTURAL CHANGES IN THE MARITIME INDUSTRY AND THE ROLE OF AUTONOMOUS

SHIP INTEGRATORS
Autonomous ships are one of the digitalization process of ships. In addition to combining existing ship
technologies with digital technologies developed in other industries, autonomous ships can be realized by, with
the help of digital technologies, highly integrating the roles that have hitherto been completed in each ship-

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related sector, such as shipbuilding, marine transportation, port operations, and warehousing. Here, the player
responsible for bringing about a high level of integration is referred to as an “autonomous ship integrator,” and
the expectations of the role and anticipated developments in the future are described below.

First of all, the autonomous ship integrator is expected to integrate various technologies as a package of
“autonomous ship solutions” by bringing together hardware-driven technologies possessed by shipbuilding
companies and marine equipment manufacturers, and the software technologies owned by IT-related
companies, such as AI for autonomous ships. In addition to strengthening upstream processes, such as
advanced design capabilities of autonomous ships, the integrator is expected to provide higher value-added
solutions by incorporating operation technologies owned by shipping companies and ship management
companies ((1) in Figure 7).

Next, the integrator is also expected to provide the stable and efficient operation of autonomous ships, such as
an onshore operations center to support autonomous ships ((2) in Figure 7). Expected capabilities include route
navigations, remote monitoring and maintenance of the engine room and cargo, support by unmanned tugboats
during docking and undocking, support by remote maneuvering in congested waters, supply of charging
infrastructure for electric ships, and to provide information on weather and sea conditions in real time (dynamic
maps for autonomous ships).

Finally, by incorporating robotics technology, such as warehouse automation technology, and highly
coordinating it with ports and warehouses, the integrator’s role is expected to expand to advanced-level
integration of maritime transportation as a whole ((3) in Figure 7). Beyond that, it will be possible to consider
providing a total transportation service from the sea to land by also coordinating with land transportation.

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