Different zero-carbon fuel options are more competitive in different decades and there is not one option which is the most competitive from today through to 2050, a new paper finds.
The paper, published by classification society Lloyd’s Register and the UK’s University Maritime Advisory Services (UMAS), is an assessment of the current and future fuels available to shipping to help define the optimum solutions as the maritime industry seeks to reduce greenhouse gas (GHG) emissions.
Building on research already undertaken by LR and UMAS into zero-emission vessels (ZEVs) and potential transition pathways to decarbonisation, the report examines the three primary pillars of the adoption of zero-carbon fuels when compared with traditional fossil-based fuels — their readiness from an investment, technology and community perspective.
The study illustrates that regardless of which zero-carbon fuels emerge as favoured options from an economic perspective, from an onboard technology perspective, ZEVs are likely to be technologically possible in the next few years. However, for owners and operators to be confident around future investments, the industry will require confidence in the wider community around the fuel supply chain, both in terms of the availability in the quantities required and the land-based infrastructure for production, supply and distribution, according to LR and UMAS.
As explained, it is important to consider how the fuel prices may evolve under the influence of the wider energy system, understanding the role that international shipping plays in this system, and the ability it has to influence, or not, the demands on new fuels.
In the short term, biofuels look marginally more competitive than fuels derived from renewable electricity or from natural gas with carbon capture and storage (NG with CCS). However, there are significant challenges related to the sustainability and availability of biofuels. Therefore, in the mid-long term, any biofuel pathway is uncompetitive and prone to restrictions or higher prices resulting from supply constraints and does not necessarily lead onto more resilient options such as hydrogen or ammonia derived from NG or renewable electricity, the paper says.
For example, ammonia produced from hydrogen, where the hydrogen is produced from NG with CCS, can be considered to be comparable to biofuels in the short term and becomes the lowest cost zero-carbon option out to the 2050s. Furthermore, over time, the production and supply of ammonia can transition from NG to hydrogen produced from renewable energy, providing a more resilient long-term transition pathway.
From a technology readiness perspective, methanol, liquefied natural gas (LNG) and diesel are more mature than hydrogen and ammonia as rules and regulations currently exist and there are vessels already using these fuels. From an onboard technology perspective, there is minimal difference, for example, between using biomethanol, e-methanol or NG-methanol; the same applies to LNG (bio-LNG, fossil-LNG and e-LNG).
The assessment of technology readiness for the various zero-carbon solutions also provides an insight into the current barriers to market uptake. One of the important barriers for new fuels such as ammonia and hydrogen is the storage and bunkering infrastructure. This means regulatory actors (class and flag) need to collaborate with original equipment manufacturers (OEMs) to enable the uptake.
The third element considers lifecycle emissions and the evolution of the energy landscape in other sectors to provide the context of the wider energy and industrial sectors.
According to the study, what may be ready from an investment and technology perspective may not be ready from other stakeholders’ perspectives. Future fuels will be expected to meet not only GHG emission criteria, but also other air pollutant standards (e.g. nitrogen oxides (NOx) and particulates) as well as contribute to broader sustainability criteria at regional and national levels.
“This paper is the next chapter of our low carbon series, following ‘Zero-Emission Vessels: Transition Pathways’ published in January 2019,” Katharine Palmer, Lloyd’s Register Global Sustainability Manager, commented.
“Our work with the Methanol Institute and UMAS is designed to help industry stakeholders to understand the dynamics and interactions between technology, investment and community readiness within the wider range of ship types, sizes and operational profiles. It reinforces that decarbonising of the shipping sector requires substantial and collaborative effort by maritime and energy stakeholders and beyond.”
“In recognising the scale of the decarbonisation challenge for shipping, there is a need for unbiased, high quality research that presents the alternatives side by side, so that owners can work with all relevant stakeholders to investigate the right solution for their fleets,” Chris Chatterton, Chief Operating Officer, The Methanol Institute, said.
“We’re pleased that this report recognises the role that methanol has to play in shipping’s transition to a low carbon economy and ultimately as a net zero carbon fuel.”
“This paper highlights the importance of using a holistic approach when assessing the fuel choice for the decarbonisation of the shipping industry and brings together two essential elements: the evolution of fuels production and the implications of their use onboard ships,” Carlo Raucci, Principal Consultant, UMAS noted.
“The answers to the strategically important question ‘what will be the future fuel for shipping?’ will require further research and analysis, in that regard, this paper provides an important contribution in answering that question.”