Maersk Line will build a container vessel powered on sustainable methanol as part of the proof of concept for the US$4.4 billion green fuels initiative, launched by six Danish companies.
The three-stage project will use currently available technology to develop green hydrogen using an offshore wind farm and a process of electrolysis. The initial plan is to scale up the hydrogen energy production to later produce sustainable methanol for the maritime sector and e-kerosene for aircraft at a competitive rate.
Once the production of hydrogen is established, for the use in trucks, the group will develop a system for carbon capture and storage, with carbon sourced from the greater Copenhagen area, that will allow carbon and hydrogen to be used in the production of methanol and e-kerosene.
Stage two will see the production of methanol and the Maersk vessel will be designed and built to use the green methanol at that time.
Ole Graa Jakobsen, Maersk vice president for fleet technology, responsible for vessel design and retrofitting of Maersk ships, confirmed that the company could build a new methanol vessel, adding that the decision would come in the future.
“We will be the off-taker of the methanol produced by the group so we will either retro-fit or build anew vessel to operate on methanol,” Jakobsen said. He added, “It is our strategic ambition to be carbon neutral by 2050, so we would need a vessel by 2030 and to make a decision on a newbuilding a couple of years before that, at around 2027-2028.”
According to Jakobsen, although no definite decision has been taken on the type of vessel used in the proof of concept stage he believes that the company would start with a regional vessel that would be able to bunker locally.
The ten-year project has an estimated cost of between €2-4 billion (US$2.2-4.4 billion) according to interested sources, who added that some of that total will need to come from the state. Asked by Container News, how much state funding was needed, the response was, “As much as we can get”.
Producing clean energy, according to the participants in the project, will always be expensive in the initial stages, as was offshore wind power, which has now reduced substantially in price. The success of offshore wind energy came with the support from the state in order for the industry to achieve a critical mass to be able to compete with other energy sources, argued the source.
Plans to develop the pilot stage of the project should be drawn up by this coming November and approval for the first phase of the project could come as early as next year with hydrogen production for trucks available by 2023.
According to DSV Panalpina’s senior executive vice president of communications, Fleming Ole Nielsen, the project is not about developing new technology, but about scaling up production at a cost that is competitive with fossil fuels.
DSV Panalpina will be involved in the trucking element of the project. 10 trucks are planned to use the green hydrogen produced by the windfarm when it is built at Rønne Banke close to Bornholm in the Baltic Sea. Initially energy from Rønne Banke will be used to power a 10MW electrolyser, that will produce the green hydrogen, with the second stage system powering a 250,000MW hydrogen production unit and in the third and final stage a 1.3GW electrolyser will be built.
“The technology already exists for the trucks,” said Nielsen. “We already run buses on hydrogen here in Denmark, but the key is to operate trucks on green hydrogen at a competitive price,” he said. “And that’s not possible without the involvement of the state,” added Nielsen.
According to the Container News source, “Scaling is the innovation, we don’t see any technical obstacles, so the end product is being competitive.”
Both the CN source and DSV Panalpina agreed that the key to the project was some initial state funding to allow the production of fuel to be competitive with fossil fuels at the early stages. “Scaling up will have to bring the cost of the [green] fuels down,” for the competitive pricing to take place.
In addition the group is hoping that the European Union will introduce some sort of carbon charging that will benefit the production of cleaner fuels.
“The ETS [emissions trading scheme] will be applied for maritime in time, how it will be structured is uncertain, but we will need to factor that into our business model,” said the CN source.
The source continued to say that they preferred a global carbon charging system to a regional ETS, which “won’t work with many grey areas and loopholes.” However, the source conceded that the “Major states of the UN will not allow the International Maritime Organization (IMO) to become a tax collector.”
Maersk CEO, Soren Skou, suggested that the maritime sector was “unique” in that it had a global regulator — the IMO — that could regulate for the type of fuel all ships will use. “If we can find a fuel that we can burn in our ships that is renewable and does not emit CO2, we can also regulate that we have to use it on a global scale, even if it’s more expensive,” he said.
The six Danish companies involved with the project are freight forwarder DSV Panalpina, ferry operator DFDS, container ship operator Maersk Line, airline SAS, Copenhagen Airports and sustainable energy provider Ørsted.