Debate over the transition to zero-carbon fuels could easily become stagnated, with the conservatives in the industry resisting the rapid decarbonisation of the industry on the grounds that a zero-carbon fuel, produced in sufficient quantities, is not yet available.
The preference is to use a lower carbon fuel that is already available and swap to ultra-low carbon fuels as they come on the market. Those that take the above view normally see LNG as the transition fuel, currently the only lower carbon fuel available.
In contrast to this view, there is a school of thought that considers the use of LNG as a transition fuel as pointless, it remains a fossil fuel and as such will not bring the industry closer to decarbonisation. What is more, there is a substantial cost and risk involved in heading down the LNG pathway.
LNG will not be sufficient to meet the International Maritime Organization (IMO)’s carbon targets, reducing carbon emissions by around 20%, and vessels built today to operate on LNG could end up in less than 10 years as stranded assets with new carbon free fuels costing less and being more readily available.
As the industry develops its understanding of the critical decarbonisation issues, the debate around the initial transition period, effectively from today up to 2030, revolves around the cost efficiency of fossil fuels as transitional energy sources, compared to the development of a zero-carbon equivalent.
As such the dichotomy within the industry is already set. There is the Maersk path, shifting directly to zero-carbon alternatives through an intense programme of research and development with key industry partners.
Or there is the CMA CGM model where you build vessels that run on dual fuel internal combustion engines with VLSFO and LNG as the fuels of choice, but with the flexibility to move to newly developed fuels as and when they are developed.
Increasing pressure from outside of the maritime industry to decarbonise faster and deeper could see targets become more stringent as the climate crisis becomes more apparent, globally. Pressure is mounting for the maritime sector to go further than the IMO’s targets to meet the Paris Agreement goals. The question, then, is can the CMA CGM model meet the far more stringent climate change requirements of the Paris Agreement, rather than the less ambitious IMO targets?
Paris Agreement decarbonisation targets represent a serious increase in the level of ambition required by the industry. According to the agreement, all 196 signatories of the Paris Agreement will keep temperature increases to well below 2degs C and preferably below 1.5degs C.
Meeting the Paris targets could require a level of ambition that the maritime industry simply does not want to commit to. Though Maersk Line executives and others have already questioned the ambition shown at the IMO.
However, to be fair to the IMO, the decisions made at its various meetings are voted on by member states and implemented by regulatory authorities within the member states. So the lack of ambition, to this extent is shown by governments, and in some cases the same governments that signed up to the Paris Agreement in December 2015, and not the IMO.
Additionally, a number of DNV executives, including Jan-Olaf Probst, DNV business development manager for container shipping, have rightly pointed out that imposing costs and restrictions on the maritime industry to help shipping decarbonise is directing the stimulus at the wrong industry. Shipping produces not a single drop of fuel but is rather a consumer of energy. Much the same as any car owner.
If shipowners cannot produce the new fuels, the stimulus from governments should be directed to those that can, agrees Dirk Kronemeijer, the CEO and founder of the biofuel firm GoodFuels, a company that can and do produce fuel.
Kronemeijer believes the best way to stimulate demand for biofuel is for governments to mandate its use gradually. Aviation already mandates the use of a small percentage of biofuel mixed into aircraft fuels. Regulators will gradually increase the biofuel requirement, stimulating demand, which in turn lowers costs as the fuel is more widely used. Marine can follow a similar pattern to stimulate demand in the shipping industry.
In his view, governments must take control of the climate change regulations, stipulating that all cars must run on electric power, currently 80% of biofuel is used by cars. Furthermore, Kronemeijer believes that biofuels should only be used for the deepsea marine and the aviation industries, because these sectors are far harder to decarbonise than the comparatively simple car and truck markets. Moreover, the IMO’s Fourth Greenhouse Gas Study shows that 86% of maritime carbon emissions are from tankers, bulkers and large container ships. With a substantial 87% increase in methane emissions, even before CMA CGM took delivery of their new LNG powered vessels in 2020.
In addition, the energy industry must have a reason for developing a fuel and demand for that fuel can be created by governments imposing levies on polluting fuels, thereby creating a situation where carbon-based energy costs increase and the gradual increase in low carbon energy, produced at greater scale, will see costs decrease.
Ask Kronemeijer about regulations such as the EU Emissions Trading System (EU ETS) and he will say, “I don’t care.” He believes that the EU ETS is “too insignificant to make any difference.” Kornemeijer argues that the trading schemes are offsetting regulations to compensate for industry emissions.
“What we need in insetting, not offsetting, where companies reduce their carbon footprint by using low carbon fuels, this is the new trend,” noted Kronemeijer, arguing that forward looking companies such as DHL are already insetting to reduce the amount of carbon attributed to their business.
GoodFuels believes there is a need for the IMO to make greater progress on developing a more ambitious low carbon strategy, and that will necessarily be from genuinely low carbon alternatives.
In order to achieve such a strategy and find the technical fixes that will help to develop the fuel of the future, the shipping industry has proposed to the IMO that a levy of US$2/tonne of marine fuel should be raised. This increase would create a US$5 billion research and development fund over 10 years, that will oversee the creation of alternative fuels. June’s Marine Environment Protection Committee (MEPC) 76 will debate the proposals.
Such a fund would be administered by the IMO and handed to R&D projects around the globe. This idea has gained some traction within the maritime industry, with the shipping line’s representatives the World Shipping Council (WSC) and one of the proposers of this policy the International Chamber of Shipping (ICS) lending their weight in backing such a levy.
The ICS says, “The R&D programme would be managed through a non-governmental research and development organisation – an International Maritime Research and Development Board or IMRB. The co-sponsors emphasise that for the proposal to work, the R&D contributions need to be compulsory via an IMO regulation, to ensure that all shipping companies globally contribute, in a fair and equitable manner, and that the necessary funds will be generated to achieve the programme’s objectives.”
In the meantime, while this R&D is continuing shipping will continue to burn fossil fuels, of which only LNG can reduce the level of carbon emissions.
Notwithstanding the IMO’s level of ambition, the infrastructure and the accoutrements necessary for the use of LNG as a maritime fuel are being built at pace today, with Spark Commodities and GAC being the latest to announce an LNG freight platform that will offer transparency to the price of LNG.
According to the partners, LNG is now a critical part of the global energy puzzle, while Platts and SEA-LNG will offer monthly LNG bunker price assessments, “In support of the development of a global LNG marine fuel value chain for shipping’s transition to a more sustainable future,” said the companies.
Rather bigger as a claim from SEA-LNG and Platts that their new price assessment will allow the industry to understand the part that LNG as a marine fuel will play in “transforming the shipping industry”.
It is an important claim and one that has gained traction among many in the maritime sector who believe that as there is no carbon neutral or zero carbon alternative, the way forward in this transitional period will be to use the best available fuel and LNG offers reductions in carbon dioxide of around 20% as well substantial reductions in nitrous oxides and particulates as well as cutting all sulphur oxide emissions.
SEA-LNG argues that there are no other viable alternative options to LNG in order to meet the transitional targets of a 40% decrease in carbon emissions compared to 2008. In fact, SEA-LNG says there are just two options available, and they are both LNG.
“One is to use LNG, thereby gaining an immediate carbon reduction of up to 21% on a well-to-wake basis compared with current oil-based marine fuels over the entire lifecycle. In combination with design and operational efficiency measures, the initial 2030 target for GHG reductions can be met using LNG. Gradual introduction of bio-LNG and at a later stage, synthetic LNG, will incrementally decarbonise shipping towards IMO’s 2050 targets,” argue the group.
According to SEA-LNG, the only other option is to “avoid making a decision” and to wait for fuels to be developed at some point in the future. However, European NGO Transport & Environment (T&E) believe there is an alternative for the transitional period.
T&E’s shipping specialist Faig Abbasov argues that LNG isn’t the only fossil technology that could reduce air pollution while the transition to zero-emission fuels takes place.
“Cleaner marine gas oil with 10 parts per million (ppm) sulphur content (similar to road fuels), coupled with selective catalytic reduction (SCR) systems and diesel particulate filters (DPF), could deliver air pollution benefits similar to LNG. But, unlike natural gas, these technologies won’t require changing ships or investing in new expensive bunkering refuelling infrastructure as LNG would. If we are looking for transitional air pollution reduction options, cleaning up the existing fuel is a cheaper and more sensible way to go,” said Abbasov.
What is more, T&E argues that with the potential for methane slip and gas leakage, during extraction, transportation and storage, will mean that LNG with a global warming potential that is in excess of 30 times greater than CO2 could effectively increase the global warming contribution from shipping rather than reduce greenhouse gas emissions.
In addition, more technological fixes could well be on the way, with a number of carbon capture and storage (CCS) solutions now in development. Not the least of these is a system that Wärtsilä says it is developing, using existing CCS technology that is based on land.
Wärtsilä is developing a technological fix that could extend the life of scrubber technology, with a CCS system modified for the marine sector, but added to existing scrubber technology.
Sigurd Jenssen, Wärtsilä’s director of the exhaust treatment division told Container News, “There will be a lot of CO2, and we will need to store that on board, but it is not that difficult, you need suitable tankage which cools and compresses the carbon.”
According to Jenssen, Wärtsilä believes the system is feasible and has established a 1MW test engine to test a CCS system on. “We will focus on conventional scrubbing technology, look at land-based solutions and leverage that know-how and the physical constraints for ships,” explained Jenssen.
While the CCS system would be suitable for conventional diesel engines, the system will not be capable of capturing emissions, particularly methane exhaust, from LNG powered engines.
Jenssen concedes that there are “pro’s and con’s” to this technology, and says that land-based solutions can deliver 90% reductions in carbon emissions, however, he adds, “Marine CCS’ may be only 70% efficient, but this may be good enough for shipping,” at this time.
While Wärtsilä’s testing project is ongoing, and could be developed in less than six years, DNV’s Jan-Olaf Probst does not believe that CCS is a viable solution for shipping. “We will only store the carbon for our children to take care of,” he told Container News, in a One-to-One interview that will be broadcast on CNTV on 3 April.
It is exactly the inheritance that our successors will be left with that is at stake in this debate. Whether that is stored carbon, substantially reduced carbon technologies or zero emissions, the next nine years leading up to the next major milestone set by the IMO for the shipping industry the debate must be open and not only show ambition, but also the industry must have the imagination to meet the, somewhat ambiguous, Paris Agreement targets rather than merely do the least required to meet IMO targets.
In the years leading up to the next major milestone set by the IMO for the shipping industry the debate must be open and not only show ambition, but also the industry must have the imagination to meet the, somewhat ambiguous, Paris Agreement targets rather than merely do the least required to meet IMO targets.
