Maritime Fuel Transition

Article
9 November 2024
#Sustainability

Emission-free ships, how on earth are we going to get that done?

How do we make the more than hundred thousand ships sailing the world's oceans more sustainable in the comming 25 years? This complex task requires innovations on multiple fronts, from technology and energy efficiency to regulation and economic viability. In this article, we highlight the main challenges and the opportunities facing the maritime sector. We will also outline the steps that are already being taken, such as stricter environmental regulations and pioneering projects in the Netherlands. Find out how the future of sustainable shipping is taking shape, with the end goal of net-zero emissions by 2050.

The maritime energy transition is not easy. Because it is not just about the necessary technology and fuel density, the much needed infrastructure also has to be put in place worldwide and new energy carriers must be available in sufficient quantities. Fortunately, the Netherlands already has several ocean-going vessels that can operate without greenhouse gas emissions.

The 5 factors

To move seagoing vessels from the current stage to having net zero emissions on a large scale by 2050, we need to distinguish five factors that play a key part in realising this challenge:

  • Technology

  • Energy demand

  • Economy

  • Regulation

  • The international context

What each of these factors means is being explained below.

1. Technology

Marine vessels currently run mainly on diesel and, in some cases, biodiesel. For full sustainability, we need new engines and technologies that run on renewable fuels. Think of hydrogen fuel cells, or internal combustion engines that can run on methanol and ammonia. There are strict requirements for such new technologies. First of all it has to be safe and be able to withstand rough handling so it survives the conditions at sea. Since you can't just call 999 whilst sailing the ocean.

New types of fuels take up more space, at the expense of spaces needed for cargo. These alternative fuels are also still much more expensive than fossil fuels. For shipowners this makes it important to do proper research into the most efficient use and fuel before they invest in an alternative fuel. This risk of investing is also a reason why there is an increasing focus on the energy efficiency of ships. For in stance, old technologies such as sails are making their return but in a newer and more innovative way. The Dutch company eConomwind's vent-i/o-foils are, for example, more comparable to vertical aircraft wings than traditional sailcloth.

2. Energy demand

Although maritime shipping is the most efficient mode of transport, ocean-going ships still have a significant energy requirement. Currently, they consume about 300 million tonnes of fuel oil annually, transporting about 90% of the goods traded worldwide.

To become more sustainable, these fossil fuels must be replaced by alternative, renewable fuels such as hydrogen, methanol or ammonia. These fuels must not only be produced sustainably, but also need to be available in large quantities at the ports where ships bunker. This requires a substantial expansion of both production capacity and the necessary infrastructure. Not just in the Netherlands or Europe, but worldwide.

3. Investments

Renewable ships are significantly more expensive than conventional ships. This is due to the higher cost of technology and especially the price of renewable fuels compared to conventional marine diesel. Shipping companies will need higher loans for these investments and have to pass the extra costs on to their customers, but this isn't always that easy.

In addition, the risk of the investment can also be an issue, especially when the technology is new, legislation is still developing, fuels are still scarce and when it is uncertain whether customers are willing to pay the higher costs. The higher the risk, the harder it is to invest.

4. Regulation

Legislation plays a key role in making shipping more sustainable. New fuels also require new safety regulations for both ship design and operations. In addition, regulation can alleviate the economic challenge, for example by a carbon tax that makes fossil fuels more expensive or by imposing obligations to use renewable fuels. Both the International Maritime Organisation and the European Union (EU) play a crucial role in drafting these regulations.

5. International context

The international nature of shipping brings additional challenges. For example, shipowners will need to be able to bunker sustainable fuels in different countries, and it is better if the same safety standards apply everywhere. Moreover, companies can easily evade regulations if they are not international, so local pricing and standard-setting measures have little to no effect. International cooperation between governments and companies is therefore essential to make sustainability effective.

To give a good overview of the big challenge, the opportunities and challenges for each new energy carrier are listed below.

Batteries

Hydrogen

Methanol

Ammonia

Nuclear power

Carbon Capture and Storage (CCS)

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Author

Louis Stolper

Innovation, Digitalisation and Public Affairs