Lowering carbon to meet regulatory timelines presents a huge – but achievable – challenge for the shipping industry, writes Panos Koutsourakis, VP Global Sustainability, ABS
As the maritime sector navigates the complexities of the 21st century, stakeholders from all facets of the industry – ranging from shipbuilders to operators – must embrace a proactive approach to innovation and regulatory compliance.
The energy transition, which involves a combination of new fuels and new technology, suggests a strategic pivot that not only aligns with global carbon reduction goals but also adapts to evolving market demands and geopolitical influences.
The latest update to the ABS Low Carbon Outlook series – Beyond The Horizon – provides an overview of the maritime industry’s ongoing transformation towards decarbonization by 2050. This transformation is highlighted by a shift from traditional fossil fuels to alternative, less carbon-intensive fuels such as LNG, methanol, ammonia, and various forms of e-fuels and biofuels.
It is also underscored by the significant changes in global trade dynamics, technological advancements, and the regulatory landscape that are steering the industry towards these new fuel paradigms.
The report includes outlines for two main net zero scenarios to align with IMO’s targets. The first scenario assumes a global reduction in emissions through enhanced energy efficiency technologies, achieving only a 15 percent reduction by 2040.
The second, more ambitious scenario, hinges on widespread retrofitting and adoption of zero-carbon fuels like e-ammonia and e-methanol, aiming to meet the 70 percent reduction target by 2040 through substantial fleet renewal and retrofits. The adoption of alternative fuels and energy efficiency technologies (EETs) is increasingly critical under an ever more stringent regulatory landscape.
Fuel Shift
Currently dual fuel represents 27% of the number of vessels currently on order or about half (49%) if we consider gross tonnage. That will increase as the available fuel mix widens this year, with methanol retrofit trials beginning in earnest and ammonia engines finally becoming available early next year.
The shift from LNG in the existing fleet to a more diversified set of fuels in the orderbook, particularly Methanol and Ammonia, suggests a trend towards exploring multiple viable options for reducing greenhouse gas emissions.
The growth in Methanol usage is particularly notable and may indicate a shift towards its adoption due to advancements in technology and fuel availability. Battery technology adoption will not increase significantly, which may suggest that while it is viable for certain types of vessels or operational profiles, it may not yet be suited for the main types of large commercial vessels unless using battery for specific load profiles such as hotel power, peak shaving and cargo loading or unloading.
The consistent introduction of Hydrogen and Ammonia highlights ongoing interest in these fuels as long-term solutions to decarbonization challenges, despite current hurdles in their widespread adoption.
Technology
The shipping industry is also exploring various technologies to meet net-zero targets, focusing on improving energy efficiency, utilizing alternative fuels, and considering innovative non-traditional solutions like Onboard Carbon Capture and Storage (OCCS). These efforts are critical in navigating the decarbonization pathway effectively.
Onboard carbon capture percentages of 80% and greater are achievable, making OCCS applicable for IMO’s long-term decarbonization strategy. However, disproportionately more energy and equipment may be required making it less economically attractive.
Advancements in alternative energy sources such as fuel cells, hybrid systems, and nuclear power are crucial. Fuel cells offer a cleaner alternative by converting chemical energy directly into electrical energy, producing only water vapor as a by-product. Hybrid systems combine conventional engines with electric motors and batteries, enhancing fuel efficiency and reducing emissions.
Achieving net-zero emissions by 2050 through requires that the economics of using green fuels and carbon capture technologies are favourable well before 2050, through a combination of progressive reduction in the cost of production and a high carbon price turning all LNG, ammonia, and methanol consumption green.
Overcoming Uncertainty
The uncertainty present in the industry ensures that the need for fuel flexibility will be the dominant trend for the foreseeable future, as operators look to hedge against geo-politically driven price volatility and patchy global bunkering arrangements.
As the powerful combination of regulation, technology, geopolitics, and shifting global supply and demand patterns shake-up the landscape of international trade and shipping, ABS is continuing to focus on the safety consequences. Whatever the decarbonizing potential of alternative fuels, it is safety that will be the hallmark of any truly sustainable industry.
The transition to cleaner fuel alternatives represents a pivotal opportunity for the industry to lead in global environmental stewardship while ensuring economic viability and competitiveness in the global marketplace. The collaborative efforts required to retrofit existing fleets and to enhance the capacity of shipyards for new, greener vessels will be critical.
Looking to the future, the industry’s commitment to a sustainable transformation is clear, but achieving these ambitious goals will require continued diligence, innovation, and global cooperation to effectively overcome the technical and economic challenges.
The views presented are only those of the author and do not necessarily reflect those of SAFETY4SEA and are for information sharing and discussion purposes only.
