Assessing the economic viability of the Arctic Northeast Passage from 2021 to 2065

ABSTRACT

The Northeast Passage (NEP) holds immense potential as a link for maritime transport activities between Europe and Asia, primarily due to the extended sailing season resulting from global warming. However, the economic viability of the Arctic shipping route remains disputed. This study aims to comprehensively evaluate the feasibility of container transportation along the NEP compared to that along the Suez Canal Route (SCR) by using current (2021–2023) and future (2025–2065) scenarios. The results reveal that larger vessels have lower CO2 emissions and costs than small vessels in the NEP, but the costs for larger vessels in the NEP are still higher than those in the SCR throughout both summer and winter seasons under the current scenario. The outcomes also show that a progressive carbon tax scheme will increase the unit shipping costs for all routes in the future scenario, with the NEP being most economically viable during summer. Furthermore, the extended navigable period (NP) bolsters the NEP’s economic cost advantage during a seasonal period. Nevertheless, from a year-round operations standpoint, the NEP remains less competitive than the SCR before 2065. The conclusions drawn from this research serve as a significant resource for decision-makers when formulating operational plans.

KEYWORDS:

• Arctic shipping
• Northeast Passage
• economic assessment
• CMIP6
• reinforcement learning

Acknowledgements

We would like to express sincere appreciation to Ship & Bunker, the SUEZ CANAL, and the FEDERAL STATE BUDGETARY INSTITUTION for the data support of our study. We are also grateful to the editor and the anonymous reviewers for their valuable comments and suggestions, which have improved the presentation of the manuscript.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Data availability statement

Data are openly available in a public repository that does not issue DOIs. The bunker price data used for assessing the economic viability of the Arctic shipping route in our model are publicly available at https://shipandbunker.com/prices. In addition, the transit fees for ships passing the Suez Canal Route are publicly available at https://www.suezcanal.gov.eg, and icebreaking and navigation pilotage for ships passing the Northeast Passage are publicly available at http://www.nsra.ru/en/home.html.

Additional information

Funding

This project is supported by the Gansu Provincial Science and Technology Program (22ZD6FA005), the National Key R&D Program of China (No. 2022YFC2807000) and the National Office for Philosophy and Social Sciences as part of the project titled ‘Strategic Competition and Cooperation in the Arctic among China, Russia, and the United States from the Perspective of Sustainable Development’ (20BGJ045).