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Navigating maritime decarbonisation: The future of green shipping

Published on

3 January 2024

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First featured on Fuels and Lubes

According to the International Energy Agency (IEA), shipping contributes 2.5% of global emissions—more than the combined emissions of Germany, a population of 83 million. It is also considered one of the hardest-to-abate sectors. The International Maritime Organization (IMO), the United Nations specialised agency with responsibility for the safety and security of shipping and the prevention of marine and atmospheric pollution by ships, has been working diligently to improve shipping’s environmental footprint for more than a decade through regulatory action. 

At the 80th Marine Environment Protection Committee (MEPC 80) meeting in July 2023, the revised IMO GHG Strategy targets were adopted. The maritime sector now aims to reach net-zero greenhouse gas (GHG) emissions by or around 2050, with indicative checkpoints for 2030 and 2040, reducing GHG emissions by at least 20% (striving for 30%)  and 70% (striving for 80%), respectively. All targets are compared to 2008 emission levels.

Achieving the new IMO targets, especially 2040 and beyond, will be “hugely challenging” and the entire maritime industry needs a paradigm shift, said Dr. Sanjay C Kuttan, chieftechnology officer (CTO) of the Global Centre for Maritime Decarbonisation (GCMD) in his keynote address Maritime Energy Transition Towards Decarbonisation at the Asian Lubricants Industry Association (ALIA) Anniversary Dinner, held at Conrad Orchard Singapore on November 8, 2023. 

Dr. Sanjay C Kuttan

Kuttan shared that governments around the world are increasingly recognising the importance of aligning national regulations with the IMO’s grand agenda to decarbonise the shipping industry. Kuttan pointed out that legislative efforts in recent years such as the Inflation Reduction Act of the United States not only includes direct support for port emissions reductions through electrification, but will also contribute to building out a green ammonia supply chain through its clean hydrogen tax incentives. Meanwhile, the European Union is implementing policies like the ETS Cap-and-Trade (2024), Renewable Energy Directive (RED II/ III) and Fit for 55 – FuelEU Maritime, all of which strengthen its commitment to reducing carbon emissions, including in the maritime sector.

In his presentation, Kuttan highlighted three main categories of decarbonisation solutions, i.e., alternative, low-/zero-carbon fuels such as ammonia, technical & operational measures, and market-based solutions.

The GCMD CTO shared the results from the inaugural survey, jointly conducted by GCMD and Boston Consulting Group (BCG), of 128 shipowners and operators that highlights the state of play in maritime decarbonisation. A finding from the survey indicates that 63% of the existing fleet of engines are unlikely to be retrofitted with future fuel capabilities because they are beyond 10 years old. Relatedly, a report by MAN Energy Solutions shows that green, zero-carbon fuels will likely not be available at the necessary scale by the end of the decade; 85% of the fuel mix for large merchant vessels will still be fossil fuels in 2030. Given so, drop-in green fuels would make sense as an immediate, near-term solution. To validate this, GCMD has embarked on establishing an assurance framework for green fuels, an initiative that is focusing on drop-in biofuels involving 13 vessels bunkering at two ports to bolster the integrity of the green fuels supply chain.

Alternative, low-/zero-carbon fuels would be a major solution towards GHG emissions reduction; such alternative energy vectors include biofuels, green methanol, green hydrogen, green ammonia, green electrons , and energy from nuclear reactors. Kuttan said the GCMD-BCG survey respondents felt positive towards ammonia as a marine fuel with 70% of maritime “frontrunners” planning to adopt ammonia as early as 2029. To this end, GCMD is helping to ready the ecosystem for this new use case of ammonia through another of its initiatives, currently scoping pilots to demonstrate ship-to-ship transfers of ammonia within port limits to mimic bunkering operations before ammonia-fueled vessels become available within the next two years.

Complexities surround the delivery of ammonia as a marine fuel, compared to current cargo transfer operations: different modes of bunkering, a lack of standards and guidelines and limited infrastructure. A rethink of operational and safety procedures in the bunkering ecosystem is urgently needed. 

Kuttan also spoke of the industry’s growing interest in shipboard carbon capture (SBCC)—the process of capturing and storing carbon dioxide (CO2) emissions directly onboard a ship to mitigate environmental impact. 60% of survey respondents classified SBCC solutions as “important” or “extremely important” in achieving net-zero targets, with 47% indicating that the technology is part of their company strategy or roadmap. On average, survey respondents expect SBCC to be commercially deployed by 2030. 

But several unresolved challenges include readiness of port infrastructure for offloading captured CO2, its onshore storage, scalability of utilisation technologies, reliability of sequestration sites and policy instruments for carbon accounting, taxation, carbon credits, and compliance against Carbon Intensity Indicator (CII) reduction targets. Carbon capture technologies could be deployed on vessels in combination with alternative, low/zero-carbon fuels solutions, said Kuttan, which is why GCMD commissioned a liquefied CO2 (LCO2)offloading concept study to address safety and operational considerations surrounding offloading of LCO2 captured on tankers, bulkers and containerships.

Kuttan also emphasised the role of energy-efficiency technologies in reducing vessels’ overall energy consumption and GHG emissions. Technical and operational measures, such as wind-assisted propulsion and air lubrication, have been around, even though they are not uniformly adopted across the maritime sector, according to the survey. What is needed is for the industry to address and close the data-financing gaps to de-risk the use of such technologies, so that more will be incentivised to install energy-saving devices onboard vessels.

Decarbonising shipping requires a combination of solutions, there is no ‘silver bullet’, Kuttan said, and the complete greening of the maritime supply chain requires all value chain stakeholders to play their roles.

Decarbonising shipping requires a combination of solutions, there is no ‘silver bullet’, Kuttan said, and the complete greening of the maritime supply chain requires all value chain stakeholders to play their roles.

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