EMSA has released a new report on the potential of synthetic fuels for shipping as part of a series on alternative fuels which already covers biofuels, ammonia, hydrogen, and wind propulsion.
The new report by ABS & CE Delft analyses the potential of e-diesel, e-methane, and e-methanol, which are renewable e-fuels, across a range of areas and indicators, including production, sustainability, availability, techno-economic aspects, and the regulatory landscape.
Production
For the three e-fuels, direct air capture (DAC) is required for all the production pathways. Since DAC is an immature technology, none of the e-fuel production pathways is currently technologically advanced enough to enter the market. In addition, some of the production routes for the three e-fuels under consideration require further technological advancements to enter the market.
Sustainability
The volume of life cycle greenhouse gas (GHG) and air-pollutant emissions generated by using e-fuels for shipping is considered significantly lower than those produced by fossil fuels. However, to produce e-fuels on a significant scale, large amounts of land are needed for wind and solar parks; this is becoming a challenge as it competes with agriculture and biodiversity conservation efforts.
In parallel, the construction and operation of wind farms may adversely affect the habitats of birds and bats. Areas with large amounts of sun, wind, and water resources, and large areas with deserts are therefore seen to be suitable locations to establish large production of e-fuels.
Lastly, materials for manufacturing wind and solar parks, electrolysers, and other systems will also be required to produce e-fuels, potentially also generating negative environmental impacts.
Availability
To ensure the large-scale production of e-fuels for the maritime industry, a tremendous expansion in the number of renewable-electricity plants, electrolysers, direct air capture plants, and e-fuel synthesis plants will be needed.
Whereas the projected global growth in renewable-electricity production could prove large enough to serve the demand for e-fuels of the commercial fleet in 2030, electrolysis capacity, e-fuel synthesis capacity, and DAC capacity are not expected to keep pace.
Furthermore, the shipping sector will need to compete with all other sectors for the renewable electricity, green hydrogen, and renewable carbon dioxide (CO2) required for e-fuel production.
The full transition of the global maritime sector to e-fuels will require a significant expansion of the industry’s capacity to produce renewable electricity, electrolysers, DAC, and e-fuels synthesis plants. An analysis of the required and available capacity for the different e-fuel production segments indicates that the largest restraint on expanding e-fuel production capacity is the development of DAC capacity.
DAC is the least developed technology and is likely to offer the longest delay before being ready for mass deployment. In addition, the costs of producing CO2 from DAC are still prohibitively high. In the short to medium term, however, this restraint could be eased by using biogenic CO2, another form of renewable CO2.
Suitability
The suitability of the three e-fuels is covered by the EMSA study ‘Update on Potential of Biofuels for Shipping’ (EMSA, 2022b).
Techno-economic aspects
The Total Cost of Ownership (TCO) has been calculated for e-methanol-, e-diesel-, and e-methane-powered newly built vessels.
- In 2030, a low-cost estimate appears to be approximately 45-85% higher than ships running on conventional fuel oils, with the use of e-diesel representing the upper end and e-methane the lower end of the cost range.
- In 2050, the TCO of newly built e-fuel-powered ships ultimately could reach a lower cost level than those powered by conventional fuel oil. This is because the cost of e-fuels is expected to decrease significantly, and carbon costs will be applicable.
Regulations
Synthetic fuels, including e-fuels, can be considered ‘drop-in’ fuels and are expected to replace fossil fuels in the future. The existing standards and regulations, as well as ongoing regulatory developments, industry guidance, and best-practice publications, are, to some extent, expected to facilitate their adoption as marine fuels. However, for wide adoption of these fuels to be realized, further developments will be needed.
At the same time, the basket of measures introduced by the European Commission under its ‘Fit for 55’ initiative sets, among others, specific targets for renewable fuels of non-biological origin (RFNBO). Simultaneously, the International Maritime Organization (IMO) has set new levels of ambition based on Well-to-Wake emissions.
Among others, there is an ambition at the IMO to increase the uptake of zero or near-zero GHG emission technologies, fuels, and/or energy sources, until they will represent at least 5% (striving for 10%) of the energy used by international shipping in 2030. All these developments are expected to support the uptake of synthetic fuels.
