Norwegian Cruise Line Holdings Ltd. Takes Action Against Climate Change with Creation of Long-Term Strategy and Goal to Reach Carbon Neutrality

Norwegian Cruise Line Holdings Ltd., a leading global cruise company that operates the Norwegian Cruise Line, Oceania Cruises and Regent Seven Seas Cruises brands,has announced the creation of its long-term climate action strategy and goal to reach carbon neutrality through reducing carbon intensity, identifying and investing in technology including exploring alternative fuels and implementing a voluntary carbon offset program.In addition to ongoing initiatives to reduce its emissions rate, the Company has committed to offset three million metric tons of carbon dioxide equivalent (MTCO₂e) over a three-year period beginning in 2021 to help bridge the gap in its decarbonisation efforts until new technology become available. As part of the Company’s global sustainability program, Sail & Sustain, combating climate change is a material focus and the Company previously signed the Cruise Lines International Association (CLIA) historic commitment to reduce the carbon emissions rate industry-wide by 40% by 2030 from a 2008 baseline.

“We take climate change very seriously and have proactively developed a long-term strategy with an ambitious goal of reaching carbon neutrality through three action areas including reducing carbon intensity, identifying and investing in technology and implementing a carbon offset program.Our commitment to purchase three million metric tons of carbon credits is a measurable step in near-term emissions reductions which allows us to take action today and helps bridge the gap in our decarbonization efforts as we prepare for a lower-carbon future,” said Frank Del Rio, president and chief executive officer of Norwegian Cruise Line Holdings Ltd. “Our global sustainability program, Sail & Sustain, is centred around our commitment to drive a positive impact on society and the environment and our long-term climate action strategy reinforces this commitment and aligns with the vision of the Paris Agreement to achieve a climate-neutral world.”

Long-Term Climate Action Strategy

The three focus areas of the Company’s long-term climate action strategy include:

1. Reduce Carbon Intensity. The Company continually seeks opportunities to reduce its overall footprint by minimising fuel consumption and increasing energy efficiency. Ongoing investments in systems and technologies have resulted in a reduction of fuel consumption per capacity day of approximately 17% from 2008 to 2019 for the entire 28-ship fleet. In addition, the Company achieved an estimated approximately 14% reduction in CO₂ emissions per capacity day across its fleet between 2015 and 2019. Asnine new and more fuel-efficient vessels are introduced to the fleet through 2027, this rate is expected to further decrease.

2. Invest in Technology &Explore Alternative Fuels. The Company has partnered with CLIA and other maritime organisations to propose the establishment of a collaborative shipping research and development fund dedicated to the ultimate goal of eliminating CO₂ emissions from international shipping. If approved, funding would come from a contribution per tonne of marine fuel purchased for consumption and is expected to amount to USD$5 billion over a 10-year period. These funds will be used to finance the development of zero and near-zero GHG fuels and propulsion technologies. As new alternative fuel sources become available at a sufficient scale in the future, the Company will evaluate how these can accelerate its long-term carbon reduction strategy.

3. Implement VoluntaryCarbon Offset Program. The Company has announced its commitment to purchase carbon credits to offset three million MTCO₂eover a three-year period to help bridge the gap in decarbonisation efforts until new technology becomes available. Offset purchases are expected to ramp up in future years to reach the goal of carbon neutrality.

The Company has a strong focus on addressing climate change and partners with CLIA, domestic and international governments and non-governmental organisations (NGOs) to contribute to global efforts to combat climate change. Key initiatives include the Company’s participation in CLIA’s historic commitment to reduce the carbon emissions rate industry-wide by 40% by 2030, which was created as the first step to contribute to the International Maritime Organization’s (IMO) vision of a carbon-free shipping industry by the end of the century.The Company also complies with applicable regulations, quantifies and reports its greenhouse gas emissions (GHG) and seeks new cost-effective ways to reduce or minimise its footprint.

Voluntary Carbon Offset Program

As part of its long-term climate action strategy, the Company has launched a voluntary carbon offset program in collaboration with World Kinect Energy Services, the sustainability division of World Fuel Services. The Company has committed to voluntarily offset at least three million MTCO₂ethrough 2023. This is the equivalent of12,133,799,744 kilometres driven by an average passenger car or the amount of carbon sequestered in 3,675,533 acres of forests in one year. The Company plans to gradually increase voluntary offset purchases in future years to reach its goal of carbon neutrality based on Scope 1 emissions, which typically account for ~95% of its footprint. This initiative allows the Company to take action immediately and further demonstrates its commitment to addressing climate change even while facing an unprecedented impact on profitability due to the COVID-19 related global voyage suspension.

A carbon offset represents one tonne of greenhouse gas emissions that has been avoided or reduced in the atmosphere. Purchasing carbon offsets allows companies to compensate for their residual carbon footprint by supporting projects worldwide that reduce carbon emissions.

Through World Kinect, the Company is investing in high-quality, trusted carbon offsets that have been independently verified and meet the highest international standards such as the Gold Standard or the Verified Carbon Standard (VCS). The offsets are from a mixed project portfolio that includes renewable energy, forestry, energy efficiency, and waste to energy projects.

Each organization has a unique journey to sustainability, but it starts with vision combined with action. We applaud Norwegian Cruise Line Holdings’ thoughtful approach and leadership,” said Michael Kasbar, chairman and chief executive officer, World Fuel Services. “Our experts at World Kinect developed a tailored carbon offset solution that enables Norwegian to make immediate progress towards their long-term sustainability goals.”

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