ABS published its report “Setting the Course to Low Carbon Shipping: Zero Carbon Outlook,” providing the latest analysis of the industry’s progress to low- and zero-carbon operations.
Hydrogen in shipping
Ammonia and hydrogen will be a major part of the rapid decarbonization of the shipping industry in any netzero scenario by 2050. Electricity production, electrolyzers technological maturity, manufacturing capacity and deployment of CCUS at scale are on the critical path for the long-term success of these fuels.
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While all projections seem to indicate hydrogen and consequently ammonia being a major component of the fuel mix, there are still many uncertainties before these fuels can truly take off.
In the short-term biofuels will play a key role in reduction of CO2 from shipping, over the medium and long term, green hydrogen-based fuels which includes ammonia, methanol will start gaining precedence. Renewable ammonia is expected to be the backbone of shipping decarbonization and could represent upwards of 40 percent of the fuel mix in 2050.
Carbon Capture and storage (CCUS)
As the world aggressively decarbonizes and the CO2 supply chain matures, the role of CCUS will only grow. The growth of CCUS could help fill demand for more long-distance transportation and bring the shipping industry to the forefront.
With the shipping industry having played a major role in developing the marine supply chains for natural gases, it is only a matter of time before its services become indispensable to the CO2 supply chain.
In addition, the development of alternative fuels to decarbonize sectors that are difficult to abate, which include long-distance shipping, will give CCUS an important role in building the hydrogen and ammonia economies. Shipping will be a key component in the long-distance transport of ammonia.
Efforts to put CCUS on board vessels are very much in their infancy; with just a few pilot studies executed, it has a long way to go before it can be considered a viable technology. However, there are a few green shoots and it will move up the maturity scale very quickly with more adoption.
Green corridors
Green corridors are a conceptual framework that aim to develop maritime routes that showcase low- and zeroemission life-cycle fuels and technologies with the ambition of helping the shipping industry reach the IMO’s goal of reducing total CO2 emissions by 50% by 2050 compared to 2008.
Shipping decarbonization has numerous moving parts and one of the challenges with its decarbonization is deployment of solutions at scale since the industry is diverse, disaggregated and globally regulated. Green corridors help shrink the challenge of coordination between fuel infrastructure and vessels, in the value chain and between countries, down to a more manageable size while retaining scale.
As part of the 2021 U.N. Climate Change Conference of the Parties (COP26), 19 countries including the U.S., U.K., Chile and Australia among other countries signed the Clydebank declaration whose aim is to support the establishment of at least six green corridors by the middle of this decade, with the aim of scaling up over the decade.
In April 2022, the U.S. Department of State (DOS) announced its aim to help setup green corridors and provided high-level guidance on what can be expected as the building blocks of the corridor. The building blocks include the following possible steps:
- Define the scope, boundaries, metrics and the framework
- Incorporate life-cycle emissions estimates
- Estimate a baseline emissions inventory for port and/or vessel operations that can be publicly available to agree upon emission reduction targets
- Work with stakeholders and communities to develop an implementation plan
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