Royal Caribbean: Time to Sink or Swim

Will Royal Caribbean innovate or will climate change take its ships by storm?

While the cruise industry has grown consistently since 2008 and is expected to reach about 24 million passengers by 2016 [1], concerns remain regarding the viability of current operating models in an environment with extreme weather changes, volatile energy costs, and increasing government regulations. To adapt to changing climate conditions, cruise ship operators like Royal Caribbean are committing to reducing their environmental footprint by modifying ship energy sources, changing route destinations, and even partnering with environmental organizations to aid in preservation efforts. Simultaneously, operators have taken an opportunist approach to climate change impacts to ensure they remain a demanded, profitable business going forward. It remains to be seen whether these industry-wide adaptations can sustain cruise tourism, or whether operators like Royal Caribbean will end up sinking in the mess they helped create.

As the largest contributor to greenhouse gas emissions on a per-tourist-trip [2], the cruise industry is at high risk of more stringent regulations that will require companies like Royal Caribbean to reduce its hazardous gas emissions. The World Tourism Organization and United Nations Environment Programme have estimated that a long-haul, luxury cruise can generate up to 9 t CO2 per trip, compared to about 0.5 t CO2 generated by other modes of international travel [3]. While the volume of these long-haul cruises is small compared to trips done by plane, train, or car, the environmental effects caused by the large diesel engines powering these ships are great, and can be largely mitigated. To help prevent these hazardous emissions, Royal Caribbean has implemented new technologies to filter and reduce the emissions that are released in the atmosphere and has brought innovation to cruise ship energy sources. In an effort to meet the International Convention for the Prevention of Pollution from Ships, Royal Caribbean modified the way it uses scrubbers in smokestacks to remove sulfur dioxide [4] “to provide greater emission reductions…at a much lower cost” [5]. In addition to its efforts to better filter gas emissions, Royal Caribbean committed significant investment in its Radiance-class ships, which are powered by gas and steam turbines and are expected to “reduce exhaust emissions by 80-90%” [6]. These technological innovations will help chip away at the growing levels of hazardous gas emissions, though it’s unclear whether these changes will be implemented across the company’s entire fleet, posing a substantial financial burden on Royal Caribbean.

In addition to the use of energy, the cruise industry is highly susceptible to weather and climate changes as temperature fluctuations and extreme weather conditions impact route destinations and consumer demand. On one hand, as our planet temperature continues to rise, new cruise destinations will become available in previously uncharted, glacial regions. Most recently, the ice in the Northwest Passage of the Arctic region melted enough to allow for the Crystal Serenity cruise to take passengers on a tour from Alaska to New York City [7]. As this region continues to melt, cruise ship operators like Royal Caribbean are well-positioned to take advantage of the opportunity to explore one of the least explored regions of the world. On the other hand, extreme weather conditions are likely to impact the industry’s primary region, the Caribbean, which represents close to 40% of all cruise ship deployments [1]. Destinations in this area are at a greater-risk resulting from climate change effects related to rising sea levels, changing weather patterns, and extreme weather [8]. While hotter temperatures, heavy rainfall, and beach erosion may expose cruise operators to some vulnerabilities related to diminishing consumer demand, hurricanes pose the greatest threat to the industry in its potential to destroy destinations and disrupt travel patterns. Cruise ship companies must become better adept at planning and forecasting weather patterns to avoid route changes related to hurricanes. Earlier this year, Royal Caribbean had to cancel a ship’s tour and delayed departures for another three ships to respond to Hurricane Matthew’s threat to the Caribbean seas [9]. Constant route changes and trip cancellations can substantially impact a large portion of Royal Caribbean’s business, requiring them to better predict extreme weather events in the future.

As climate change continues to impose risks to the cruise industry, it is incumbent upon ship operators to take a proactive approach to mitigating these threats going forward. Royal Caribbean has taken impressive strides in partnering with research programs to collect data on ocean and atmosphere patterns through the Ocean Fund [10]. By providing data to university researchers, Royal Caribbean is actively funding and supporting programs to better monitor and study climate change effects. However, research programs alone won’t move the needle for the cruise tourism industry. Royal Caribbean should invest in energy suppliers to find new technologies that will drastically reduce hazardous waste emissions. Without innovations in ship transportation for consumer travel, Royal Caribbean operations will be at mercy of nature’s forces.

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[1] Kennedy, Sarah. “2016 CLIA State of the Industry,” Cruise Lines International Association, 2016,, accessed November 2016.

[2] “GEO-5 for Business. Impacts of a Changing Environment on the Corporate Sector,” United Nations Environment Programme, 2013,, accessed November 2016.

[3] “Climate Change and Tourism. Responding to Global Challenges,” World Tourism Organization and the United Nations Environment Programme, July 2008,, accessed November 2016.

[4] Moodie, Alison. “How environmentally friendly is your cruise holiday?” The Guardian, June 2016,, accessed November 2016.

[5] “EPA, Coast Guard Extend Pollution Control Agreement with Royal Caribbean: New advanced technologies allow industry to comply with emission standards, reduce costs,” United States Environmental Protection Agency, December 2014,, accessed November 2016.

[6] “Climate Change Adaptation and Mitigation in the Tourism Sector: Frameworks, Tools and Practices,” United Nations Environment Programme, 2008,, accessed November 2016.

[7] Dennis, Brady and Chris Mooney. “A luxury cruise ship sets sail for the Arctic, thanks to climate change,” The Washington Post, August 2016,, accessed November 2016.

[8] “Climate Change in the Caribbean and the Challenge of Adaptation,” United Nations Environment Programme Regional Office for Latin America and the Caribbean, 2008,, accessed November 2016.

[9] “Hurricane Matthew Weather Update,” Royal Caribbean International, 7 October 2016,, accessed November 2016.

[10] “Celebrity Cruise Ship Joins University of Miami ‘OceanScope’ Program to Monitor Oceanographic and Atmospheric Conditions,” PR Newswire Association, May 2014, ABI/INFORM via ProQuest, accessed November 2016.




Winter is not coming…

Student comments on Royal Caribbean: Time to Sink or Swim

  1. Excellent read. Climate change is an interesting beast for the cruise industry – it is essentially fighting a war on two fronts:

    On one end are the ships themselves, and the pollution the cruise ships are contributing. Unless there is a bottoms-up redesign, most ships will continue to be made with diesel engines. I doubt any hybrid solution is viable, and furthermore, the use of nuclear energy, although it makes sense, will never happen. This situation is uninspiring, and I think this will become more of a public relations issue, rather than a technology issue. I could see cruise companies arguing that the average waste/pollution per customer on a cruise ship is less than for an individual who goes on a trip elsewhere.

    On the other front is the effect climate change will have on weather and routes. Unfortunately there is no way around this problem. I foresee a future of compressed margins as more trips are cancelled and insurance costs increase. Hopefully the industry can capitalize on new routes as the ice up north melts!

  2. The data point you cited regarding tons of CO2 per passenger trip (up to 9 tons for luxury cruise passengers versus 0.49 ton for the “average international tourist trip”) was certainly eye-catching and I can see why you included it in your post. However, after looking at the source (the 270-page UNEP tourism report), it seems the word “cruise” in this context refers (rather puzzlingly) to “fly-cruise to Antarctica,” per the second paragraph on page 139.

    Here’s a different calculation from a carbon offsetting company called ClimateCare[1]: 0.43 kg per passenger mile. This is still much higher than air travel (0.257kg per passenger mile), but quite as not eye-poppingly high. A 1,000-mile cruise, for example, would have a 0.5 ton footprint–about the same as a transatlantic flight. This, of course, is a real problem for luxury cruise companies, who (as you noted) are busy trying to develop more efficient ways to power their ships.


  3. This is a very well-structured argument on how the cruise industry can stay afloat (pun intended) in the face of climate change. But, I think that the risks to the business outweigh the potential benefits.

    As the public becomes more educated on the impacts of climate change, they are recognizing that the extreme weather patterns (such as Hurricane Matthew that you cited) are the result of our changing climate. I imagine that as the public becomes even more educated and weather patterns (or lack of patterns) persist, people will become wary of sea-voyage for vacations.

    I think Royal Carribean and other cruise liners should focus on preparing themselves for the decrease in demand rather than only contingency plans in the face of these changing weather patterns.

  4. Tourism industry in general has been a significant contributor to climate change and based on your post the cruise industry has certainly had a large share of that. Your post goes deep into the pollution that ships generate but what are some operational aspects of cruise tourism that also contribute to climate change? Cruises often offer unlimited meals and drinks to the guests and I can only imagine the amount of waste they generate on a per trip basis. Are the likes of Royal Caribbean doing anything to improve their operation to minimize impact on the environment?

  5. Interesting post and a good read – I definitely agree that the cruise industry will have imminent increases in regulation. With the rise of global tourism, we have seen increased scrutiny on the transportation industry; it started with cars, but now airplanes and cruises will see more regulation as well.

    I hope that this will drive increased investment in cruise ship engine technology. It’s interesting to see how the car market responded to increased cost of driving (via gas prices) and increased incentives to be gas efficient (e.g, being able to use the carpool lane), developing a market opportunity that paved the way for electric vehicles. Depending on how regulation is designed on the cruise industry, I hope the government can do so in a way to will incentivize a similar investment in building out the R&D of the cruise engine industry.

    It feels like a similar radical technology – if applied to a vehicle that consumes considerable energy given its size – would lead to a considerable reduction in GHG emissions and increase sustainability overall. This is especially true when considering what’s in the water; there’s countless marine life and organisms, and I would think that cleaner energy solutions would be better for their survival as well.

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