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

2022-12-26 11:03By： Breakwave Advisors

The International Transport Forum (ITF), part of Paris-based OECD, has called for the swift implementation of carbon pricing for shipping to speed up the sector’s shift towards zero-emission ships. The price gap between conventional and zero-emission ship fuels hinders the adoption of known and sometimes available technological solutions, the ITF has argued in a new 44-page report.

Worldwide, 68 generic carbon pricing schemes exist on supra-national, national, and sub-national levels.

They cover around 23% of global greenhouse gas emissions, according to the World Bank. Only one scheme, Norway’s national carbon tax, encompasses emissions from maritime shipping.

Studies indicate that carbon pricing on its own is often insufficient because prices are too low to trigger full decarbonization. They are most effectively applied in tandem with other instruments, such as regulations and standards. Carbon pricing schemes can generate significant revenues and thus provide funds for investing in zero-emission technologies and infrastructure. These could have a long-lasting impact by lowering the costs of zero-emission shipping. Governments should also agree on a technical design requirement for zero-emission readiness for new vessels, the transport think tank has recommended. This standard would require all new vessels to be capable of running on zero-emission fuels or other zero-emission energy sources. Governments should also consider introducing a low-emission fuel standard that would become progressively stricter and so help to phase out fossil fuels in shipping. The forum said it was vital that any incoming pricing schemes and standards cover well-to-wake emissions.

Research Studies

Methylcyclohexane explored for hydrogen shipping from Scotland to Rotterdam: An international consortium has launched a study on the feasibility of shipping hydrogen at scale from Scotland to the Port of Rotterdam in the form of methylcyclohexane. Methylcyclohexane (MCH) is a chemically stable liquid produced from toluene and hydrogen that can be transported under ambient temperatures and pressure in chemical carriers. Parties behind the project include Axens, Chiyoda, EnQuest, ERM, Koole Terminals, Port of Rotterdam, Storegga and th,e Net Zero Technology Centre. The plan is to carry out engineering studies targeted at developing a pilot project as a precursor to large-scale export. The Scottish government, which is targeting 5 GW of green hydrogen production by 2030 and 25 GW by 2045, is backing the initiative together with the Shetland Islands Council.

Alliances for Decarbonization

Wärtsilä takes a mission ambassador role for Zero Carbon Center: Finnish technology group Wärtsilä has further strengthened its ongoing project partnership with the Mӕrsk Mc-Kinney Møller Center for Zero Carbon Shipping with the company signing as an official mission ambassador.

The not-for-profit research and development center is aimed at accelerating the transition towards a net-zero future for the maritime industry. Together with partners, the center drives and facilitates the development and implementation of new technologies, while building confidence in new concepts and mature viable strategic ways to achieve necessary systemic and regulatory changes. Globally, 100,000 commercial vessels consume around 300 million tons of fuel every year, making shipping accountable for around 3% of global carbon emissions. The center is committed to driving sustainable decarbonization of the maritime industry by 2050 through collaboration, applied research and regulatory reform. Recently, it outlined four key levers identified to fast-track the transition.

DSME joins hands with POSCO on eco-friendly shipbuilding materials: South Korean shipbuilder Daewoo Shipbuilding & Marine Engineering (DSME) has signed a business agreement with compatriot steel-making company POSCO to establish a cooperative system for the development and application of new materials for shipbuilding. As disclosed, the two companies plan to accelerate the development of new materials that can be applied to future ships and the development of new welding technologies. According to the statement, they are preparing to develop new materials such as special steel that can withstand high pressure and low temperature to transport liquefied carbon dioxide and high manganese steel to store and transport cryogenic liquefied hydrogen at – 235 ℃.

Additionally, they will focus on the development of ammonia fuel tanks and ammonia fuel propulsion which should be used on future eco-friendly ships. With the new International Maritime Organisation’s (IMO) zero-emission requirements coming into force, the companies recognized the importance of developing new technologies which can be used to achieve the net-zero goals.

Maersk and SunGas Renewables form green methanol partnership: Danish shipping and logistics giant A.P. Moller – Maersk has signed a Letter of Intent (LoI) with US-based SunGas Renewables, Inc., a spin-out of GTI Energy, to form strategic green methanol partnership as part of its strategy to decarbonize customers’ supply chain. With this LoI, SunGas joins eight other strategic partners working to supply the green fuel needed for the 19 methanol-enabled container vessels Maersk currently has on order. The other partners are Carbon Sink, CIMC ENRIC, Debo, European Energy, Green Technology Bank, Orsted, Proman, and Wastefuel. The 19 vessels that will be put in operation during 2023-2025 will require approximately 750.000 tonnes of green methanol.

Industry Actions

ExxonMobil earmarks $17 bln to step up lower-emission efforts over next five years: U.S. energy giant ExxonMobil has hammered out its five-year corporate plan, ramping up its spending to $17 billion on greenhouse gas emission-reduction projects over the next five years while maintaining disciplined capital investments in its portfolio. The oil major is also hoping to double its earnings and cash flow potential in this period. ExxonMobil revealed that its corporate plan for the next five years prioritizes high-return, low-cost-of-supply assets in the Upstream and Product Solutions businesses and supports efforts to reduce greenhouse gas emissions intensity from operated assets along with those emitted from other companies. The U.S. giant outlined that this plan is expected to double earnings and cash flow potential by 2027 versus 2019. It also supports the firm’s strategic priorities, including safety, shareholder returns, earnings, and cash flow growth; cost and capital efficiency; and reductions in greenhouse gas emissions intensity.

HMM readies methanol-fuelled newbuilds: South Korea’s flagship carrier HMM is the latest shipping line to be veering towards methanol dual fuel orders with multiple local media outlets suggesting it has invited tenders from Korean yards to build up to nine 8,000 teu dual fuel ships. Hyundai Heavy Industries, Samsung Heavy Industries, Daewoo Shipbuilding & Marine Engineering and HJ Shipbuilding & Construction are all in the mix for contracts. HJ Shipbuilding & Construction was formerly known as Hanjin Heavy Industries & Construction.

Next Generation of Vessels

BULKER

U-Ming names LNG-powered Capesize pair destined for Anglo-Eastern: Chinese shipbuilder Shanghai Waigaoqiao Shipbuilding hosted a naming ceremony for two LNG-powered bulkers built for Taiwanese bulk carrier company U-Ming Marine. The two Capesize bulkers (187,300 dwt and 210,000 cbm) were named Ubuntu Harmony and Ubuntu Equality during an online ceremony held simultaneously in Singapore, Taipei, and Shanghai. The two dual-fuel LNG-powered bulkers, classed by Det Norske Veritas, are equipped with two C-type LNG fuel tanks. Each vessel is 299.80 meters long, 47.5 meters wide, 24.70 meters deep, with a design draft of 18.25 meters and a design draft speed of 14 knots. The ships are fitted with MAN Energy Solutions’ high-pressure ME-GI engines with drastically reduced methane slippage.

CCS issues approval for 85,000-ton methanol dual-fuel bulk carrier: China Classification Society (CCS) has issued approval in principle (AiP) for an 85,000-ton methanol dual-fuel dry bulk carrier developed by Huangpu Wenchong Shipping, a subsidiary of China State Shipbuilding Corporation (CSSC). The approval was awarded on 14 December for the vessel with a length of 225 meters, a width of 36 meters, and a depth of 20.15 meters. The ship has a draft of 14 meters and a cargo capacity of up to 85,000 tons. It is propelled by a 9,000-kilowatt methanol dual-fuel engine and can achieve life-cycle low-carbon emission reduction.

TANKER

Proman Stena Bulk rounds off 2022 with 4th methanol-powered tanker: Proman Stena Bulk, the joint venture between tanker company Stena Bulk and methanol producer Proman, has taken delivery of its fourth methanol-fuelled tanker, Stena Prosperous. The 49,990 DWT vessel was built by Guangzhou Shipyard International Co Ltd (GSI) and will now enter commercial operation running fully on methanol. The joint venture fleet has already loaded methanol fuel in Ulsan, Trinidad and Rotterdam in the past year, with other major bunkering hubs to follow in 2023. Stena Prosperous, like its sister vessels, has a low Energy Efficiency Design Index (EEDI) value while running on methanol which is 11% below the 2025 Phase 3 requirements.

Conoship’s next-generation diesel-electric cargo vessel in production: The construction of the next-generation diesel-electric propulsed cargo vessel, developed by Maritime engineering company Conoship International Projects, has kicked off in Turkey. The ceremonial start of the 3600 tdw vessel’s first construction took place on 24 November at the Gelibolu Shipyard in Turkey, and the vessel is expected to be delivered in 2023. According to Conoship, the design is ready for wind-assisted propulsion, as it is prepared for the placement of Econowind VentiFoils®, which is estimated to reduce fuel consumption and CO2 emissions by about 10% annually, depending on the sailing route. Conoship said that the design is highly future-proof as the Energy Efficiency Design Index (EEDI) of the vessel as calculated as a diesel-driven vessel is already below the phase 3 requirements, and additional elements of the design arrangement facilitate a switch to future fuels.

CRUISE

Meyer Turku floats out Royal Caribbean’s 1st LNG-powered cruise ship: Icon of the Seas, which is being built at the Meyer Turku shipyard, was launched on Friday, December 9, 2022. Over the weekend, the ship will be moved to the outfitting dock, where it’s now fully assembled hull will receive final outfitting. The shipyard celebrated the float-out with a ceremonial cannon firing. Icon of the Seas is Royal Caribbean’s first ship that runs on liquefied natural gas and utilizes fuel cell technology. The vessel will also feature shore power connections and waste heat recovery systems. The Finnish shipbuilder started construction on the Icon of the Seas in June 2021.

LNG-powered Arvia delivered to P&O Cruises: German shipbuilder Meyer Werft has handed over the LNG-fuelled cruise ship Arvia to the British shipping company P&O Cruises. Arvia is a sister ship of the Iona, built-in 2020. Both vessels have been described as ‘future proof’ as they will be able to run on carbon-neutral liquefied natural gas (eLNG) once available at scale. The Excel-class vessel has an accommodation capacity of 5,200 passengers across its 2,659 cabins. Arvia measures over 180,000 GT, is 344.5 meters long, and 42 meters wide. The construction of the ship began in February 2021, and the vessel was officially launched this August.

TECHNOLOGY

Value Maritime’s tech picked for Ardmore’s carbon capture-ready tankers: Bermuda-headquartered Ardmore Shipping has selected Value Maritime’s emission-reducing technology to install on six MR tankers. As explained, the company has placed an order for the emissions-reducing Filtree system, including the Clean Loop system. The Filtree system is based on technology that will filter sulphur, CO2 and 99% of ultra-fine particulate matter from the tankers’ exhaust stream. The Filtree system, to be installed on the Ardmore tankers, will be outfitted with a modular CO2 capture and storage system to help reduce further emissions when this becomes viable. With this, CO2 is captured from a vessel’s exhaust and stored in tanks onboard. This is then discharged onshore where it can be used, for example, in the sustainable cultivation of greenhouse crops, methanol plants, and even the food industry.

Marinfloc systems for methanol fuelled boxships: Swedish company Marinfloc has initiated delivery of combined EGR bleed-off and Bilge water separators for a major South Korean newbuilding project, having handed over three of a total of 12 shipments for the 16,200 TEU methanol-powered vessels. ABS, Lloyd’s Register, DNV, and MAN Energy Solutions have approved Marinfloc’s solution, which also complies with MEPC.107(49) and MEPC.307(73). All 12 vessels will be using a MAN B&W 8G95ME-C10.5-LGIM-EGRTC engine equipped for methanol fuel and will employ a Marinfloc CD5.0 EGR system to treat both the EGR bleed-off water and the bilge water. The flocculation technology utilized by the Marinfloc treatment unit is believed to be effective in terms of both treatment efficiency and cost, regardless of the type of fuel burned. The delivery is the first for methanol-fuelled vessels, but several units have been delivered to date for other systems with the first vessel in operation since early 2022.

‘World’s first’ design approval for compressed hydrogen carrier awarded to Provaris: Australian Provaris Energy, former Global Energy Ventures (GEV), has obtained design approval from the classification society American Bureau of Shipping (ABS) for its compressed hydrogen carrier H2Neo. ABS has reviewed, verified and approved the design of Provaris’ 26,000 m3 H2Neo compressed hydrogen carrier, which is said to be the first of its kind to receive this level of approval. Described as the critical milestone, the approval follows the completion of front-end engineering design (FEED) work.

Shipyards

Shipbuilder delays delivery of LNG-powered Carnival Jubilee over supply-chain snags: German shipbuilding group Meyer Werft has postponed the delivery of the LNG-fueled ship Carnival Jubilee, which is being built for the US-based Carnival Cruise Line. The cruise ship is under construction at Meyer Werft in Papenburg, Germany. Meyer has notified Carnival that due to supply chain logistics and related matters, the October 2023 delivery date has been re-set for early December 2023. Based on the new schedule, once delivered the vessel will then transit directly to Galveston to operate the first guest cruise for the Christmas holiday, departing on Dec. 23, 2023. The 182,800 gross tonnage Carnival Jubilee is the third ship in the Excel-class vessel series, powered by LNG. Its sister ships are Mardi Gras and Carnival Celebration, which are already in operation. Carnival Cruise Line held a christening ceremony for its new flagship, Carnival Celebration, at PortMiami on 21 November.

Hudong-Zhonghua starts building CMA CGM’s fourth 13,000 TEU dual-fuel boxship: Chinese shipbuilder Hudong-Zhonghua, a subsidiary of China State Shipbuilding Corporation (CSSC), is making progress in the construction of 13,000 TEU dual-fuel containerships ordered by French shipping major CMA CGM. On 9 December, the shipbuilder started construction of the fourth unit in a series of six 13,000 dual-fuel ships.

In addition, the first ship from the series was docked on 12 December.

The vessels are part of CMA CGM’s $2.3 billion dual-fuel, LNG-powered containership order from April 2021, which was described as the largest single containership order in China’s shipbuilding history. The 13,000 TEU vessels are the second type of dual-fuel containership built by Hudong-Zhonghua and represent the latest generation of green, environmentally friendly, high-efficiency and energy-saving boxships, the shipbuilder said upon kicking off construction of the second ship earlier this year.

Fuels

GoodFuels delivers 100% biofuel to AIDA Cruises vessel: AIDAprima, the Aida Cruises Hyperion-class cruise ship, was refuelled with GoodFuels’ sustainable biofuels, without blending with conventional marine fuels, during its 8 December port call to Rotterdam, the Netherlands. GoodFuels said the AIDAprima vessel was bunkered with biofuel without requiring any modifications to the engine or tanks, thanks to the fuel’s “drop-in” properties. According to the provider, its sustainable biofuel is derived from feedstocks that are certified as 100% waste or residue, including processed used cooking oil, tallow, and animal waste fats, and it enables a well-to-exhaust CO2 reduction of 80% to 90% when compared to fossil fuels. The two companies started the partnership in July 2022, when AIDAprima was bunkered with a blend of biofuel and conventional marine fuels, and it is set to continue in the future.

Vancouver port becomes a testing bed for alternative fuels: The Vancouver Fraser Port Authority, together with partners from across the port community, is testing various low- and zero-emission fuels and technologies at the Port of Vancouver, as part of the port authority’s efforts to phase out all port-related emissions by 2050 in support of the Government of Canada’s goal to achieve net-zero emissions by 2050. Through the Low-Emission Technology Initiative, a joint initiative between the port authority and the Province of British Columbia, the port authority and the province have each committed C$1.5m in funding to support the port community’s transition to low-emission energy, including the testing of battery-electric-powered terminal tractors, 100% biodiesel on commercial ferries, a hydrogen-powered crane, and 100% renewable diesel on a terminal locomotive and one of the port authority’s patrol boats.

Ports

Port of Antwerp-Bruges, partners net $152mln EU funding for CO2 transport project: Air Liquide, Fluxys Belgium, and Port of Antwerp-Bruges have been granted €144.6 million ($152 million) for the construction of shared CO2 transport and export facilities on the Antwerp port platform. The project is the first phase of Antwerp@C, an initiative gathering Air Liquide, BASF, Borealis, ExxonMobil, INEOS, TotalEnergies, Fluxys, and Port of Antwerp-Bruges with the ambition to halve the CO2 emissions in the Antwerp port area by 2030. In this first phase, Air Liquide and BASF will be the launching customers of the export hub through their joint CO2 capture and storage (CCS) project Kairos@C.

Canada’s Port of Prince Rupert activates shore power to reduce ship emissions: The Port of Prince Rupert, on Canada’s Pacific coast north of Vancouver, has expanded the shore power capacity at DP World Prince Rupert’s Fairview Container Terminal, achieving a milestone in its path to emissions reduction. Through a partnership between the Prince Rupert Port Authority (PRPA), DP World, and BC Hydro, new electrical infrastructure has been installed at the terminal’s north berth, and upgrades were made to the south berth. Full commissioning of the shore power system now allows ships at both berths to shut down their main generators and rely on specially equipped dockside power connections while their cargo is being loaded and unloaded. The ability to plug in large container vessels to shore power while at either terminal berth is forecast to reduce carbon emissions by almost 30,000 tons annually, as well as other air emissions related to vessel exhaust, such as nitrogen oxides and particulates, from the local airshed.

Montrose Port to become 1st Scottish port to provide shore power: Montrose Port Authority has partnered with Norwegian company Plug Shore Power Ltd in a 50/50 joint venture to become the first Scottish port to offer shore power to offshore energy vessels. As explained, the partnership will see an initial investment of £1 million into the joint venture which will be named Plug Montrose Ltd. The installation of shore power, which is expected to take around six to twelve months to complete, would see a significant reduction of CO2 at Montrose which will be tracked through Plug’s administration system.

NAVTEK, Oppsense to offer all-electric tug and zero-emission port project in Canada: Toronto-based company Oppsense and Turkish naval design and engineering specialist NAVTEK Naval Technologies have entered a partnership to offer a fully electric tug and zero-emission port project for the Canadian market. According to the companies, the new partnership will enable the Canadian maritime industry of having access to NAVTEK’s holistic approach to the maritime decarbonization concept: the world’s first all-electric tugboat, ZEETUG and a zero-emission electric port project, ZEEPORT.

Port of Québec looking into shore power potential for cruise ships: The Port of Québec has decided to conduct a feasibility study on providing shore power supply for cruise ships. The announcement was made at the International Cruise Forum in Québec City. The study will evaluate project costs, technical feasibility, and its impact on reducing greenhouse gas (GHG) emissions. Talks are underway with suppliers and Hydro-Québec to determine the energy needs such a project would require.

Currently, only 2% of all ports around the world, fewer than 30 in all, are equipped to provide electricity to docked ships. By greenlighting such a project, the Port of Québec would have a significant contribution to the industry’s decarbonization.

Regulations

Norwegian shipping company Stolt–Nielsen Limited has joined the critics of the International Maritime Organization’s (IMO) Carbon Intensity Indicator (CII), which comes into force in January 2023: The company explained why the CII is causing headaches for the chemical tanker segment and may even prove counter-productive when it comes to reducing carbon emissions.

The CII is a yearly measure of overall ship efficiency while in operation. Every ship receives an energy rating based on its efficiency ratio, which measures the distance traveled and speed as well as the intensity of the use of the vessel. Ratings are given on a scale of A to E, whereby D and E ships are considered non-compliant by the IMO and are only allowed to be operational for a short period (three years for D or one year for E), before they must be corrected to a midpoint C rating.

The criticism of the CII has largely been derived from the fact that the rating will be impacted by factors that are out of owners’ control such as adverse weather, voyage distance, port waiting times, and port infrastructure.

Governments

Meyer Turku, Finnish Govt to work on climate-neutral ships with RCL: The Finnish government, represented by the Ministry of Economic Affairs and Employment (MEAE) and Meyer Turku Oy, has signed a deal with the US-based cruise major Royal Caribbean Group on sustainable shipbuilding in Finland.

The parties signed a maritime declaration that lays the groundwork for the creation of a roadmap to produce climate-neutral ships in Finland. The roadmap is part of the maritime industry’s green transition. The declaration also paves the way for strengthening innovation between Meyer Turku, and Royal Caribbean Group including piloting and testing new technologies on Royal Caribbean Group ships. The document also outlines steps for a digital demonstration of a climate-neutral ship as part of the sustainable maritime industry development program of the Ministry of Labor and Economy.

By Maria Bertzeletou, Breakwave Advisors

The opinions expressed herein are the author's and not necessarily those of The Xinde Marine News.

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