Shipping Decarbonization Weekly Insights -- How shipping moves ahead to run on zero-carbon fuels

2022-09-07 15:45By： Breakwave Advisors

The International Renewable Energy Agency (IRENA), co-founding partner Siemens Energy and 13 companies across all industry sectors have launched the Global Alliance for Industry Decarbonization. The new alliance aims to accelerate net-zero ambitions and the decarbonization of industrial value chains in pursuit of the Paris Agreement climate goals. It will also work to enhance the understanding of renewables-based solutions and their adoption by industry.

The new coalition was officially launched by adopting the Bali Declaration in the presence of IRENA's director-general Francesco La Camera and the executive board member of Siemens Energy, Karim Amin, during IRENA's Investment Forum on Energy Transitions in Indonesia.

Co-founder Siemens Energy has been a major driver for the creation of the alliance and will co-chair the alliance leadership, whose first meeting is planned to take place at COP27 in Sharm El Sheikh, Egypt.

The participation of leading industries can benefit business opportunities for green industrialization and highlights the importance of collaboration in developing strategies and sharing best practices to cut industry emissions, IRENA said.

One additional strategic alliance came between Danish energy company Energinet and Dutch gas infrastructure firm Gasunie. The two parties signed a memorandum of understanding (MoU) to accelerate the preparations for cross-border hydrogen infrastructure between Denmark and Germany. Energinet has also launched a study that investigates the feasibility of a hydrogen backbone in the western part of Denmark including infrastructure for exports to Germany.

The preparation outlined in the MoU includes a coordinated approach toward network development planning based on the results of the pre-feasibility-study and the latest market developments in both supply and demand.

Alliances for Decarbonization

ABP, Air Products working on UK's first large-scale green hydrogen facility: Associated British Ports (ABP) and industrial gases company Air Products have joined forces to bring the first large-scale green hydrogen facility to the Port of Immingham in the Humber, UK. The facility would import green ammonia from production locations operated by Air Products and its partners around the world. This would be used to produce green hydrogen, aiming to decarbonize hard-to-abate sectors such as transport and industry. ABP is investigating the potential to develop a low-carbon hydrogen supply to the Port of Immingham together with its project partners Uniper, Siemens Energy, and Toyota Tsusho. The partners submitted a joint bid to develop a low-carbon hydrogen supply in June this year.

Clean Arctic Alliance calls for ‘rapid’ creation of Arctic green shipping corridors: The Clean Arctic Alliance, a global campaign made up of 20 international non-for-profit organizations, has written to the ministers from Norway, Denmark, Iceland, Greenland, and the Faroe Islands to propose a number of domestic and international actions which would help to rapidly kick-start the establishment of green shipping corridors in Arctic waters. In May, Nordic climate and environment ministers signed an agreement to establish green corridors for emission-free shipping between ports in the Nordic Region. By cleaning up shipping in the region, this ambitious and progressive move has the potential to protect air, climate, marine environment, and the health of millions of people.

Industry Actions

12 new LNG bulkers will be equipped to burn HFO for Himalaya Shipping: The independent bulker operator Himalaya Shipping plans to install scrubbers on a fleet of 12 LNG-powered Newcastlemax bulkers currently under construction at New Times Shipyard (NTS) in China. The installation acknowledges the reality of LNG dual-fuel power today: LNG is so expensive that most LNG-fuelled oceangoing ships have switched to VLSFO. The addition of a sulfur scrubber - while unnecessary for running on LNG - will allow these bulkers to operate on the least-cost conventional fuel, HFO. The vessels will deliver in 2023-24.

Mitsui invests $7 million in Norwegian Hydrogen: Japanese trading company Mitsui & Co. has invested invests NOK 70 million (around $7 million) in Norwegian Hydrogen, the company that will build and operate green hydrogen production sites in the Nordic region. Norway's clean energy transportation company Hexagon Purus is one of the largest shareholders in Norwegian Hydrogen. On 27 August 2022, it announced that Mitsui & CO. invests NOK 70 million in the company. Through private placement, Mitsui becomes the second largest owner in the company with a stake of around 15 per cent. Norwegian Hydrogen will develop, build, and operate production facilities and infrastructure for green hydrogen.

G2 Ocean launches carbon offset program: Norwegian open hatch specialist G2 Ocean has launched a carbon offset program for its customers enabling them to digitally offset the emissions of their shipments by choosing to fund one or multiple climate projects. G2 Ocean only supports certified projects that reduce, avoid, or remove greenhouse gas emissions from the atmosphere. Examples include landfill gas energy projects or programs that promote renewable energy. G2 Ocean has also committed to offsetting its emissions associated with electricity consumption and business travel, the company's scope 2 and 3 emissions.

Maersk to operate its first green warehouse in Denmark: Danish shipping and logistics giant A.P. Moller – Maersk has unveiled plans to operate the company's first low greenhouse gas (GHG) emissions contract logistics warehouse in Denmark. The 40,000 sqm facility has an option for an additional 40,000 sqm and is scheduled to become operational in 2024. It will be located in Taulov in South Denmark. The project will be realized in partnership with Taulov Dry Port, which is a Danish joint venture between ADP A/S and PFA Pension. The green contract logistics warehouse is aiming to be built to BREEAM Excellent standards with zero direct emissions from operations in full accordance with Maersk's overall goal to decarbonize its entire operations by 2040.

Next Generation of Vessels

COSCO and CNPC's dual-fuel LNG carrier completes trial voyage: The first 174,000 cbm liquefied natural gas (LNG) carrier built by Chinese shipyard Hudong – Zhonghua Shipbuilding for compatriot shipowner COSCO Shipping Lines and energy firm China National Petroleum Corporation (CNPC) has completed its trial voyage. This is the first 174,000 cbm LNG carrier manufactured by Hudong – Zhonghua for COSCO Shipping Lines and CNPC's Hong Kong-listed unit PetroChina as part of their project to expand the LNG industry. As described, it is an upgraded and optimized LNG ship based on the company's self-designed fourth generation XDF dual-fuel propulsion.

New Proman Stena Bulk tankers complete South Korea's 1st methanol bunkering: Shipping joint venture Proman Stena Bulk said that it's two fully operational methanol-fuelled tankers have become the first vessels to bunker methanol in Ulsan, South Korea. Stena Pro Patria and Stena Pro Marine were each refuelled with over 2,000 tonnes of methanol during the bunkering operation. The operation comes as proof of the growing viability of methanol as a marine fuel (MMF), according to viability of methanol as a marine fuel (MMF), according to the JV between Swedish shipping company Stena Bulk and Swiss methanol producer Proman.

Ferries / Cruise

China Merchants Jingling Shipyard (Weihai) signs up for new eco-friendly ferry project: Chinese shipbuilder China Merchants Jingling Shipyard (Weihai) and shipping services provider China-Japan International Ferry has held a signing ceremony for the new environmentally friendly shipbuilding project. The signing ceremony for the roll-on/roll-off (RoRo) passenger ferry took place on 26 August in Shanghai. The ship is 167.2 meters long and 25 meters wide, carrying 192 passengers and 334 standard containers. Its design focuses on green environmental protection and carbon emission reduction as described. The ship is the first RoRo passenger ferry independently developed in China to meet the requirements of EEDI Phase 3. It will also be equipped with an intelligent ship system.

LR clears Torghatten Nord's hydrogen ferry project: Lloyd's Register (LR) has awarded Approval in Principle (AIP) to Norwegian shipowner Torghatten Nord for two hydrogen-powered vessels operating on Norway's longest ferry route, Vestfjordstrekninga, connecting Bodø, Røst, Værøy, and Moskenes. The two vessels, designed by Norwegian Ship Design, will use a minimum of 85% ‘green hydrogen’ based fuel, helping to reduce CO2 emissions on the route by an estimated 26,500 tons each year. The two main components of the hydrogen system on board are the hydrogen storage part, feeding hydrogen to fuel cells, and the fuel cells themselves, providing electric power for the propulsion and all other consumers on board. Torghatten Nord said the company can now move to the construction stage of the ships. The ferries are scheduled to enter operation in October 2025.

Wärtsilä propulsion for the world's largest aluminium catamaran powered by LNG: Finnish technology group Wärtsilä has been contracted to supply engines, waterjets, and fuel storage and supply system for a new high speed catamaran ferry powered by liquefied natural gas (LNG). The vessel is being built at the Incat yard in Tasmania, Australia on behalf of Argentinian ferry operator Buquebus. The vessel will operate between Argentina and Uruguay with Wärtsilä's 31 dual-fuel engine technology using primarily LNG fuel produced at Buquebus own LNG plant.

2nd of four MOL's LNG-fueled ferries hit the water: Sunflower Murasaki, the second of four LNG-fueled ferries ordered by MOL Group, was launched and named earlier today at a Mitsubishi Shipbuilding's yard in Shimonoseki-shi, Yamaguchi Prefecture. Sunflower Murasaki and its sister vessel Sunflower Kurenai, which was named in March 2022, are Japan's first LNG-fueled ferries. The vessels were ordered back in 2019. They are fitted with dual-fuel engines and are expected to cut CO2 emissions by 20% and virtually eliminate sulfur oxide emissions when compared to the current vessels in use on the route. Two more LNG-fueled ferries are expected to follow suit and they are slated for delivery in 2025.

LNG-powered cruise ship Arvia floated out: On 27 August, the new cruise ship Arvia being built for the British cruise line P&O Cruises left Meyer Werft's covered building dock in Papenburg, Germany. Following the float out, the newbuilding moored at the outfitting pier in the shipyard harbor, where the masts and funnel will be lifted onto the ship by crane. The cruise ship will lie in the shipyard harbor until the river Ems conveyance in October. Until the conveyance, the interior work on board will be continued and further technical tests will be carried out. The Arvia measures over 180,000 GT, is 344.5 metres long, 42 metres wide and identical in construction to her sister ship Iona, which was delivered in 2020.

Technology

HHI secures design approval for its rotor sail: South Korean shipbuilder Hyundai Heavy Industries (HHI) has won design approval from the Korean Register of Shipping (KR) for its ‘Hi-Rotor’, an independently developed model of a rotor sail. The approval is the first of its kind in the country's shipbuilding industry as the sector moves toward developing green technological solutions to decarbonize shipping. Wind-assisted propulsion systems are gaining popularity as a tool for reducing a ship's fuel consumption and carbon emissions.

WinGD, HSD Engine team up on methanol-fueled two-stroke ship engines: Swiss marine power company WinGD and Korean engine builder HSD Engine have initiated a joint development project (JDP) to advance the development of WinGD's methanol-fueled big-bore engines. As informed, the aim is to deliver an engine capable of running on carbon-neutral green methanol by 2024, providing shipowners with a solution enabling them to meet IMO's 2050 target – and to reach net-zero emissions – with their next generation of vessels. Under the JDP, WinGD will oversee combustion and injection research, exhaust after-treatment requirements, and engine concept design. HSD Engine will provide support for cost-effective manufacturing and assembly, provide engine testing capabilities, and deliver fuel supply and exhaust after-treatment systems.

Large ocean-going ships are the perfect fit for nuclear propulsion: Large ocean-going vessels have the most potential for nuclear propulsion, a new research by Dutch ship design and engineering company C-Job Naval Architects shows. The research found that nuclear energy could be applied as marine propulsion in the future. According to the independent ship design company, nuclear technology has seen several interesting developments and should be considered for future maritime applications.

By creating four different concepts — bulk, container, tanker, and offshore –, key items were analyzed, including the mass and volume of the energy storage and power generation system. It shows that, even though the shield around the reactor is a significant portion of the respective mass and volume of the nuclear power generation system, in most cases, the nuclear option is lighter and more compact than the conventional marine diesel option.

CO2 Storage

Yara Signs Landmark Deal for Offshore CO2 Storage: Norwegian fertilizer manufacturer Yara has signed the world's first cross-border CO2 transport and storage deal with Northern Lights, the Norwegian offshore carbon storage project. Both entities are based in Norway, but the transport will be cross-border, delivering liquefied CO2 by ship from a Yara plant in the Netherlands to the Northern Lights injection facility.

From early 2025, 800,000 tonnes of pure CO2 will be captured at the Yara Sluiskil plant in the Netherlands, then compressed, liquefied, and transported to the Northern Lights well off the coast of Øygarden.

Fuels

Qatar to build the world's largest blue ammonia facility: Qatar is beginning construction on what they are calling the world's largest blue ammonia facility as the country seeks to diversify and expand its energy industry. Already one of the world's largest exporters of LNG and rapidly expanding its north field, QatarEnergy plans to add blue ammonia, citing the ability to leverage its experience in gas. Blue Ammonia is produced when the CO2 generated during conventional ammonia production is captured and stored. Blue Ammonia can be transported using conventional ships and be used in power stations to produce low-carbon electricity and potential future applications in other hard-to-decarbonize industries.

Blue World Technologies is ready to scale up methanol fuel cell tech for the maritime sector: The Bill Gates-founded investment fund Breakthrough Energy Ventures (BEV) has entered as an investor in Danish fuel cell company Blue World Technologies alongside Vaekstfonden, DEUTZ AG, and existing investors who invested back in December 2021 to complete the company's €37 million series B round. As informed, the series B funds will be used for scaling the fuel cell production as well as investing in the development of methanol-driven fuel cell applications for the maritime sector. The investment from Breakthrough Energy Ventures has been partly funded by Breakthrough Energy Ventures and Breakthrough Energy Ventures-Europe (BEV-E).

Bureau Veritas releases new ‘biofuel ready’ notation for the shipping industry: French classification society Bureau Veritas (BV) has issued a new ‘biofuel ready’ notation to support the wider deployment of biofuels in the shipping industry. BV said that this notation will help the maritime industry address the main challenges related to the use of biofuels by ships, providing requirements to ensure ship safety and environmental compliance. The notation aims at helping shipowners to be prepared for the use of biofuels or biofuel blends by providing a set of requirements and outlining a comprehensive methodology for the required documentation and testing, considering the fuel's technical specifications.

Methanol as a promising clean fuel for the global fleet: U.S. classification society American Bureau of Shipping (ABS) highlights methanol as a promising fuel source for the global fleet as a pathway to carbon neutrality through green methanol. Methanol also brings practical benefits related to ease of storage and handling, and tank-to-wake carbon intensity reduction.

That's the conclusion of Georgios Plevrakis, ABS vice president, Global Sustainability, following an evaluation of the emerging fuels landscape and propulsion technology. ABS has analysed the various fuels in its ‘Zero Carbon Outlook’ study and explored methanol and other carbon-neutral fuel options.

South Africa and Japan to develop green ammonia fuels market: South African chemical and energy company Sasol and Itochu Corporation of Japan have signed a Memorandum of Understanding (MoU) to jointly study and develop the market and supply chain for green ammonia with a focus on its use in applications such as marine bunker fuel.

The parties will evaluate Itochu's potential involvement and participation in Sasol's green ammonia export-orientated project(s), including product offtake as well as financial support from Japan for studies and grants relating to green ammonia projects in South Africa. The MoU was signed in Tunisia during the Tokyo International Conference on African Development (TICAD 8), a forum to advance Japan-Africa sustainable development. MUFG Bank witnessed the signing of the MoU.

Biofuels

TotalEnergies and COSCO in milestone biofuel bunkering op: TotalEnergies Marine Fuels has completed the first refueling of a COSCO Shipping Lines containership with sustainable marine biofuel. This is TotalEnergies' first biofuel bunkering operation for a containership in Singapore. This was made possible with support from the Maritime and Port Authority of Singapore (MPA) and the involvement of local partners such as tank storage company, Vopak Terminals Singapore at Penjuru.

NYK invests in tech to convert garbage onboard into biofuels: Nippon Yusen Kaisha (NYK) is looking at converting waste onboard into energy. Japan's second-largest shipping line by dwt has invested in Sustainable Energy, which operates an energy supply business using unused resources such as flammable waste generated in cities. Sustainable Energy has developed its own integrated subcritical-water organic-waste power-generation system, or ISOP system, which decomposes organic substances using subcritical-water-treating technology and ultimately produces green energy products such as biofuels. Through this investment, NYK will begin joint studies on converting organic waste such as garbage and sludge generated on vessels into fuel by utilizing the ISOP system.

Ports

Ports of Stockholm breaks ground on Sweden's 1st cruise ship onshore power connection: Ports of Stockholm is investing in the construction of onshore power connection facilities for cruise ships at two city center quays. By plugging into onshore power supplied from the local electricity grid cruise ships can shut down their engines and significantly reduce their environmental impact. The initiative is a collaboration with other Baltic Sea ports, including the ports in Copenhagen, Aarhus, and Helsinki to enable cruise ships and shipping companies to connect to onshore power of a common international standard in all of the different ports. The move is aimed at encouraging more shipping companies to invest in ship-based equipment to connect to onshore power.

Belledune, Wilhelmshaven ports partner up on clean fuels, green energy: Canada's Belledune Port Authority (BPA) has signed a memorandum of understanding (MOU) with Niedersachsen Ports Wilhelmshaven, Germany, to collaborate on the movement of dry and liquid bulk commodities, and manufactured products, between Canada and Germany, with a focus on clean fuels and green products. As explained, the MOU will support the MOU between the governments of Canada and Germany to establish an energy partnership aimed at achieving net-zero emissions by 2050 through a transition to safe, secure, reliable, affordable and sustainable energy.

Peel Ports' Heysham wants to be UK's first fully carbon neutral port: The Port of Heysham, part of Peel Ports Group, revealed that it had reduced the carbon emissions of its landside plant, equipment, and vehicles by up to 90%. The port confirmed that all its vehicles, plant equipment, forklift trucks, tug masters, and ancillary equipment are now operating on either electricity or hydrotreated vegetable oil (HVO). Located in the northwest of England, and due to its close proximity to major industrial clusters, Heysham provides a direct gateway to the Republic of Ireland, Northern Ireland, and, the Isle of Man. The port handles a wide range of cargo including Roll-on Roll-off, agri-bulks, automotive, project cargo, and energy products. Peel Ports has committed to becoming a net zero port operator by 2040. Over the past decade, the port operator has invested over £1 billion ($ 1.18 billion) in sustainable infrastructures such as electric cranes, cold ironing capabilities, electric or biofuel vehicles, and increasing rail connections.