Sofia Fürstenberg Stott has been unraveling some of the latest big announcements coming out of the shipping sector as it sets its sails and sights on 2030 and 2050.
Last week, Lloyds Register and Maersk jointly released an announcement, where they revealed that the transition from fossil fuel oil to low-carbon alternatives, will have significantly more impact on OPEX than CAPEX. This while also revealing that going forward, Maersk will focus on methanol, ethanol, ammonia and biofuel exploring viable fuel options for the future.
This is of course big news, as it is every time the Danish shipping giant announces direction and drive, and this time around, it will probably have significant impact on how various options for low carbon fuels will be perceived as viable alternatives going forward. The statement also signals something else. It signals a somewhat linear approach to the decarbonisation challenge: Don’t look beyond current business model, just change the fuel.
While it is so important that the big players who have the knowledge, network and capacity to lay the path forward, are indeed taking big, bold and active steps towards a net-zero carbon future for shipping, we must all stay awake and not sit back, relax and enjoy the journey while others are comfortably doing the work for us.
The fuel options Maersk have short-listed for the net-zero trajectory are all carbon carriers, directly or indirectly. They can be produced from anything ranging from virgin biomass or second/third generation biomass, to wind or wave, or they can be produced as they normally are; from a fossil source. For instance, ammonia production (usually produced from natural gas) currently stands for 1% of global annual CO2 emissions. The proportion of “green ammonia” -produced from renewable sources, is currently very small.
Hence, these fuel options are only net-zero, if indeed they are produced from validated renewable sources. Doubtless Maersk and LR are really aware of this but we should all understand the size of the challenge ahead. This is not simply a case of upscaling to meet demand.
This week the Global Maritime Forum has had their annual summit, and for sure decarbonization is on top of the agenda. The GMF has earlier initiated the GettingToZero Coalition which takes an ambitious and structured approach to solve the decarbonisation challenge. They acknowledge the need for verification and control, and a standard definition for zero carbon energy sources has been established with intention to include fuels derived from zero carbon electricity, biomass and the use of Carbon Capture and Storage, proposing further that there are “abundant untapped resources of renewables”.
This is why we must stay awake. There are a number of hidden stumbling blocks which we now must be sure to identify and recognise:
- How can we ensure that a biomass source, short-listed for primary or secondary use in fuel production, is not using land (or sea) resources in such a way, that it has a net-positive impact on CO2? What if this land could be used for food production instead? What if farmers are chased off their land because government sees opportunity to fuel shipping? Are the opportunity costs on other Sustainable Development Goals understood?
- How can we control and account for that the fuel we purchase, in different locations around the world, are indeed net-zero? Even though the GettingToZero Coalition will look at strategic options for developing a fuel supply infrastructure, for sure they cannot forbid any ship to fuel somewhere else? How can we ensure we create a fuel supply network and ecosystem that allows for a level playing field?
2030, or indeed 2050, from a shipping-cycle perspective, is not very far away. Viable fuel options will have to be tested, piloted and scaled up, new engines and propulsion systems will have to be developed. Safety standards, class requirements etc., will have to be agreed and implemented. On this journey towards decarbonisation however, we mustn’t forget to make sure, that we also develop a functional control mechanism, that gives us reputable, non-temperable, and validated evidence of the carbon neutrality of any zero or net-zero carbon fuel.
Maersk and LR are probably right, that the decarbonisation journey has more impact on OPEX than CAPEX. From where I stand though, it looks like the really big costs lurking on the horizon, infrastructural costs not disregarded, have to do more with validating the net-carbon impact, from well to wake, as well as the gathering and control of system level data.
Sofia Fürstenberg Stott is a leading figure in the innovation- and sustainability sphere of the maritime industry. As an advisor to the industry, she developed Nor-Shipping’s new concept exhibition Blue Economy, and launched the first Opening Oceans Conference, connecting the wider ocean industries for the first time. She has been a visible figure in the Nordics for the last 10 years, through her tenure as innovation manager with Maersk, and as a green shipping spearhead with DNVGL. She holds an MBA in Shipping & Logistics from CBS, and a MSc in Chemical Engineering from Lund University.
