ALTERNATIVE FUELS

The use of LNG as a bunker fuel it is leading the way forward for meeting 2050 targets and the adoption of new fuels, says Steve

Esau of SEA-LNG

Steve Esau Chief Operating Officer, SEA-LNG

LNG LEADS THE WAY TO 205O TARGETS

According to Clarksons, more than 30% of the new build tonnage on the order books is liquefied natural gas-fuelled. So why are shipowners choosing LNG?

In addition to its unparalleled local emissions benefits, LNG can reduce CO2 emissions by up to 23% on a well-to-wake basis compared with liquid fossil fuels. Blending in bioLNG or renewable synthetic LNG can further improve this figure. BioLNG and synthetic LNG are fully compatible with existing LNG engines and infrastructure and can be transported, bunkered, and stored using technologies currently in use today.

BioLNG is a proven pathway to carbon neutrality as it reuses waste from farming activities, industries, and households to create green fuel. This process can capture methane that would otherwise be vented into the atmosphere, resulting in a fuel that is not just potentially net zero in greenhouse gas (GHG) emissions, but one that also has the potential to be net negative in emissions.

When produced from waste streams, bioLNG can support the circular economy and help with yet another global concern: waste management. This gives it an added advantage over many other alternative fuels.

With its many benefits, it is easy to see why production infrastructure for bioLNG is on the rise. The European Commission has invested some €118m into 32 decarbonisation projects, including one involving Bio-LNG Hub Wilp that aims to establish a bioLNG production plant in the Netherlands.

In France, several key energy firms, including CMA CGM and TotalEnergies, have joined forces to embark on bioLNG production project, expanding the potential for increased availability of the fuel. With a strong pipeline of projects, the European Biogas Association predicts production of the fuel in Europe could increase tenfold by 2030.

The mainstream introduction of bioLNG to shipping has already begun. In late 2020,

TotalEnergies bunkered the CMA CGM Jacques Saadé at Rotterdam, and some 13% of the 17,300m3 of LNG supplied was bioLNG. A month later, UECC bunkered the Auto Energy with drop-in bioLNG, while Gasum has bunkered ESL Shipping’s dry bulk carrier Viikki with 100% renewable bioLNG in Finland.

On the other side of the Atlantic, in September 2021 JAX LNG undertook the first bunkering of bioLNG in the US, supplying Tote’s Isla Bella with a bioLNG/LNG blend in Jacksonville, Florida.

Renewable synthetic LNG has also entered the market. In September 2021 Unifeeder, working with MAN Energy Solutions, conducted the world’s first bunkering of carbon-neutral renewable synthetic LNG when it fuelled the ElbBlue in Brunsbüttel, Germany.

And in November CMA CGM and ENGIE signed a wide-ranging partnership aimed at developing renewable synthetic LNG, with several projects already identified in Europe.

Just like other synthetic fuels, such as green ammonia and green methanol, synthetic LNG is made from hydrogen produced from electrolysis using renewable electricity. Between 70% and 80% of the cost of all of these synthetic fuels is related to the cost of producing the hydrogen feedstock.

However, the fact that renewable synthetic LNG is operationally proven and can be used in existing vessels and transported, stored and bunkered using existing infrastructure means it is likely to be lower in price than other synthetic fuels.

A 2020 CE Delft study concluded that the potential supply of bioLNG based on sustainable biomass exceeds the energy demand from the shipping sector. Supplies of renewable synthetic LNG will be based on the build out of renewable electricity capacity, as is the case with other synthetic fuels.

“Not only does LNG provide a pathway to decarbonisation in its own right, but it also provides the physical infrastructure and asset base that can be used by other alternative fuels, such as hydrogen and ammonia”

SUPPORTING CHANGE

There are major technological and regulatory hurdles still to be overcome before ammonia and hydrogen can safely be used as marine fuels, and investment cases will be hindered by safety issues, environmental challenges, and their low energy density.

Rather than holding back the development of these new fuels though, adoption of LNG supports them. Not only does LNG provide a pathway to decarbonisation in its own right, but it also provides the physical infrastructure and asset base that can be used by other alternative fuels, such as hydrogen and ammonia; the capacity in shipyards in building vessels propelled by cryogenic/ gaseous fuels; the development and dissemination guidelines and processes for the safe bunkering of these fuels in ports around the world; and, critically, the capacity to train seafarers.

It is clear that energy majors are pushing the benefits of LNG, and their plans should give shipowners confidence in the availability of LNG in the future. For example, Shell and Total are rapidly making LNG available on global trading routes at major ports in Europe, Asia, and North

America, through major investments in LNG bunkering vessels.

Furthermore, engine manufacturers do not want shipowners to be left with stranded assets as new fuels enter the market. They understand the need for flexibility given that there will be no one-size-fits-all new fuel by 2050.

To that end, Wärtsilä, for example, has announced the development of a cryogenic fuel supply and combustion concept that combines the advantages of Diesel and Otto cycle technology and comes as a modular add-on for existing 2-stroke engines.

The platform will enable the fast and cost-effective conversion of 2-stroke main engines, and the first new fuel to be offered will be LNG. This will be followed by retrofit options for ammonia and methanol, as and when these fuels become commercially available.

As another example, Anglo Belgian Corporation has introduced a multi-fuel engine platform designed to facilitate the transition from conventional fuel to future fuels including biodiesel, LNG, hydrogen, and methanol. The platform is specifically designed to make it financially viable to adapt the same engine to these fuel types.

INCENTIVISING CHANGE

Regulators are well-advanced in mandating change. The EU’s proposed “Fit for 55” package of legislation is broadly aligned with SEA-LNG’s position that goal-based and technology-neutral policies are needed to ensure innovation and a level playing field for all low and zero-carbon marine fuels.

However, there remain wrinkles to be ironed out. While FuelEU Maritime looks at all greenhouse gases and the entire fuel life cycle (well-to-wake) basis, the proposed extension of the EU Emissions Trading System (ETS) to maritime only looks at CO2 and only at emissions during actual combustion (i.e. on a tank-towake basis).

As it stands, FuelEU Maritime is likely to incentivise the uptake of LNG in the short term and bioLNG in the medium term as carbon intensity targets bite. Longer term, we are likely to see increasing demand for zero-emission synthetic fuels such as renewable synthetic LNG, green methanol, green hydrogen, and green ammonia.

Uptake of the different fuels will be driven by operational requirements, safety issues and cost.

SEA-LNG firmly believes the decarbonisation of shipping will require a basket of different fuels and propulsion systems and each should be evaluated on a full GHG lifecycle basis.

Restricting regulatory thinking to tank-to-wake and picking winners, as has been proposed by some in the industry is likely to increase the costs of decarbonisation.

By choosing the LNG pathway, operators can immediately cut carbon emissions, and they will be able to continue operating as normal under the IMO’s Carbon Intensity Indicator (CII) system until after 2030. Blending in bioLNG and renewable synthetic LNG will further extend compliance to 2050 and beyond.

LNG can be the difference between having a ‘moderate’ C-rated ship and having a ‘major superior’ A-rated ship on the CII scale, and for every 10% increase in the use of bioLNG or synthetic LNG, a vessel gains two-years of additional compliance.

This means lower ship emissions now and a compliance extension that yields long term competitive advantage.

“By choosing the LNG pathway, operators can immediately cut carbon emissions, and they will be able to continue operating as normal under the IMO’s Carbon Intensity Indicator system until after 2030”

FUNDING CHANGE

As banks increasingly align with green finance principles, LNG, through its lower CO2 emissions, provides an “extended compliance runway” for Poseidon Principles sustainability linked loans.

Analysis from SEA-LNG demonstrates how a ship running on LNG can benefit from preferable asset financing for up to eight years compared to one running on conventional fuels like high sulphur fuel oil, very low sulphur fuel oil and marine gas oil.

This provides owners of LNGfuelled ships with a strong competitive advantage, including extra time to extend compliance even further through the use of fuel options such as bioLNG or synthetic LNG.

At last count, there were 261 LNGfuelled ships sailing, with a further 435 on order. By the end of this year, an estimated 170 ports worldwide will offer LNG bunkering. Clearly, SEA-LNG is not alone in recognising the benefits of LNG.

In summary, the choice of an LNG-fuelled propulsion system is unlikely to leave ship owners with stranded assets, as fuel availability is promising for bioLNG and synthetic LNG, and there are many regulatory advantages to LNG, both now and into the future.

Therefore, it is clear that the LNG pathway offers a viable route towards a zero-carbon future.

Crucially, this enables shipping to start the decarbonisation journey now. There is no need to wait a decade or longer for other, untried, and unproven fuels.

A new report predicts an alarming shift towards fossil fuel use, while innovations in ammonia and tidal energy give a boost to sustainability

TIME TO CHANGE THE NARRATIVE

A quarter of Europe’s shipping will be fossil gas-powered by 2030 as misguided EU sustainability targets encourage an uptake of LNG, a new Transport & Environment (T&E) study shows. This will lock-in fossil fuel use for decades while bringing limited benefits to the climate, says T&E.

Delphine Gozillon, sustainable shipping officer at T&E, says: “The shipping industry is one of the world’s biggest polluters and is heavily reliant on fossil fuels. The old narrative of gas as transitional fuel just doesn’t hold. We cannot afford to shift from one fossil fuel to another. It will not get us to zero emissions by 2050 and, by putting more methane into the atmosphere may even fry the planet faster.”

Last year, the European Commission proposed a law requiring ship operators to reduce the lifecycle carbon footprint of the fuels. The EU targets, which are tightened over time, are designed to gradually squeeze out the most polluting oil-powered ships, and, in theory, drive the uptake of sustainable fuels.

Instead, they will be replaced by fossil liquefied natural gas (LNG)-powered ships, which the regulation gives the green light to well into the 2040s. According to the report, with costs far cheaper than genuinely clean alternatives, LNG will make up 23% of the total energy used in EU shipping by 2030, up from 6% today.

As the EU proposal stands, ships will have little or no incentive to switch to more sustainable alternatives such as green hydrogen or hydrogen-based fuels known as “e-fuels”. Currently, there is no mandate for e-fuels, meaning shipowners can rely on fossil LNG and what T&E calls dubious biofuels to meet EU targets into the 2040s.

Delphine Gozillon concludes: “Europe’s policymakers should introduce dedicated quotas and incentives to boost demand for hydrogen-based fuels. Genuinely clean solutions do exist, but currently they are expensive. If we kick start demand now, a green shipping future is possible. Continue to waste precious time on fossil gas and it will start to look impossible.”

T&E recommends mandating a 6% target for shipping e-fuels by 2030 as the most straightforward way to ensure supply and demand for sustainable fuels, while providing business predictability to shipowners and fuel suppliers. Without this minimum share of e-fuels and stricter greenhouse gas targets, full decarbonisation by 2050 will likely be out of reach.

The EU’s shipping fuel law – FuelEU Maritime – is currently under discussion in the European Parliament and the Council, with a final text expected in the second half of 2022. T&E calls on policymakers to adopt key changes to the proposal. 1. T&E’s modelling is based on ship order books for ships until 2023 with future LNG ship sales assumed based on the increase due to fuel oil being no longer compliant with the regulation anymore. LNG is the cheapest among alternative fuels. 2. About 80% (79%) of LNG burned today is burned in an engine (lowpressure 4-stroke) with worse well-to-wake greenhouse gas (GHG) emissions than traditional engines running on dirty fuel oil. If methane’s short-term global warming effects were accounted for, only the lowestmethane slippage engines would comply with FuelEU Maritime’s GHG targets. Estimation of the fuel consumed by LNG-powered ships in the 2020 MRV fleet is based on fleet characteristics data from IHS.

AMMONIA STUDY

DNV has been selected to lead an ammonia bunkering safety study by the Global Centre for Maritime Decarbonisation in Singapore.

The pioneering study aims to define a robust set of safety guidelines and operational envelopes that will establish the basis of a regulatory sandbox for ammonia bunkering trials at two local sites.

DNV will team up with Singapore’s leading infrastructure developer Surbana Jurong and the Singapore Maritime Academy. DNV’s work scope will comprise ammonia demand forecasting, bunkering site recommendations, the development of conceptual designs of bunkering modes like truck to ship or ship to ship, HAZID/HAZOP/QRA studies, as well as drafting of technical and operational guidelines.

While ammonia is one the most promising fuels to decarbonise shipping, DNV research shows that a number of safety gaps hold the potential to disrupt the speed and success of the transition. “The safe handling of ammonia is one such gap which urgently needs to be closed, given the threat it poses to seafarers and ships unless properly managed,” says Knut ØrbeckNilssen, CEO of DNV Maritime.“We are therefore thrilled to partner with Surbana Jurong and the Singapore Maritime Academy on this pioneering initiative, which we hope will lay the foundations for robust ammonia bunkering safety guidelines with industry wide applicability.”

In response to the growing industry interest for ammonia fuelled and ammonia ready ship designs, DNV has undertaken many projects in the development of ammonia as a viable future marine fuel.

DNV’s “Fuel ready” notation was launched as an industry first in April 2021 by Höegh Autoliners in its new series of car carriers. The notation verifies that a vessel complies with the safety and operational requirements for future ammonia fuelled operations, and that the main engine can be converted or operate on the fuel.

For shipowners looking to move towards a full zerocarbon fuel option with their next newbuilding, DNV’s new “Gas fuelled ammonia” rules provide a practical path. Further adding to this work, DNV has awarded several Approvals in Principle for ammoniafuelled ship designs, while also co-operating with engine maker MAN Energy Solutions on the safe development of a 2-stroke ammonia engine intended to be market-ready in 2024.

“Next to our broad practical experience, our research detailed in the Ammonia as a marine fuel white paper shows that we are well equipped to undertake this groundbreaking ammonia bunkering study,” comments Cristina Saenz de Santa Maria, DNV Maritime’s regional manager southeast Asia, Pacific and India.

“We welcome that Singapore, as the world’s leading bunkering port, is exploring ammonia as a viable ship fuel and are very happy to be selected to contribute to the pilot. Safety is the prerequisite for the successful and timely introduction of new fuels such as ammonia, hence joint research and development, testing and setting standards is crucial at this point.”

According to its recent Maritime Forecast to 2050, DNV expects there will be demonstration projects for onboard use of ammonia by 2025, paving the way for zero-carbon ships ready for commercial use by 2030. While the future fuel mix will be broad, DNV predicts that both ammonia and bio-based methanol are the most promising carbon-neutral fuels in the long run. ENERGY INVESTMENT

Bureau Veritas has welcomed the UK government’s plans to invest in the UK’s tidal energy industry, suggesting that tidal stream electricity has the potential to become one of the most viable and reliable sources of renewable energy in the world.

The government investment is part of the Contracts for Difference (CfD) scheme, which invites renewable energy companies from across the UK to bid for a share of £285m of funding for low-carbon technologies. Launched recently, a total of £20m per year has been ring-fenced for tidal stream projects, which represents the biggest investment in a generation into tidal power.

Hailing the move as a positive opportunity for the marine energy sector, Mauricio Pereira, head of renewable energy at Bureau Veritas, says: “We hope that the investment will build upon the success of the offshore wind sector and provide a viable, and perhaps even stronger, alternative to wind and solar energy generation. Quite simply, tidal stream electricity has the potential to become one of the lead sources of renewable energies in the world. The energy potential of tides can be predicted for years to come with tidal turbines able to harness the energy of high and low tides down to the minute.

“Additional benefits of the investment into tidal stream electricity include the creation of new ‘green’ jobs, and the potential to re-distribute and upskill employees of fossil fuel industries. It also means that by having more options for renewable energy here in the UK, we’re in a much better position to move away from fossil fuel reliance; a crucial requirement if we’re to keep 1.5° in reach.

“Despite tidal power being a relatively unknown technology and energy source – and a need for there to be additional studies into understanding the impact tidal turbines may have on the marine environment – the ring-fenced £20m in the CfD Scheme is almost on par with that of floating off-shore wind (£24m), suggesting that the focus to alternative renewable energy sources is well and truly shifting,” he adds.

“The funding made available as part of the CfD Scheme will support in allowing the marine energy sector the opportunity to focus on research, rapid innovation and the acceleration required to meet net zero targets.

“Currently, the cost for tidal power technology is incredibly high, however with the investment the government is committing to – which will drive an increased focus on R&D – there is the potential for costs to drastically reduce as happened with offshore wind; making tidal energy a tangible option for the future.”

CLEAN FUELS

To explain the future fuel options for vessel owners and operators in the international shipping sector, TotalEnergies Marine Fuels has released a new white paper, The Drive for Cleaner Marine Fuels.

This publication offers insight on shipping’s energy transition and decarbonisation journey. To view the report, visit: marinefuels.totalenergies.com

Multi-fuel systems and hybrid power offer a systems approach to surviving the future fuels transition, as Børge Nogva,

President of Høglund Marine

Solutions, explains

Børge Nogva President, Høglund Marine Solutions

THE ROAD TO TRANSITION

The decarbonisation treadmill is accelerating for shipowners. With news that the Poseidon Principles will soon look to exceed the International Maritime Organization’s (IMO) targets and aim for full net zero (as opposed to the 50% reduction aimed at by the IMO), shipowners are under more pressure than ever to reduce emissions.

At the same time, one of the potentially simplest decarbonisation options for shipowners – that of gradually introducing drop-in sustainable fuels – is being called into question. A recent report from the Oil and Gas Climate Initiative looking at pathways for decarbonisation argues that this strategy will, in the long term, be more expensive than investing in green ammonia and hydrogen, and the uptake of energy efficiency technologies.

This has generated heated debate and it’s unlikely that it’ll be resolved any time soon. However, the facts on the ground remain unchanged. Shipowners cannot replace their existing fleets overnight. Neither can they afford to wait for green ammonia and hydrogen to scale up. While these sectors are advancing quickly, they are still a long way away from being able to supply fuels globally. For ships with changing, dynamic operating patterns such as tankers or bulkers, global availability is key.

So, how can owners continue to operate their fleets as efficiently as possible and future-proof themselves in order to thrive in whatever the future fuel landscape ends up looking like?

If they aren’t already, owners and operators should be analysing their energy management strategy as a major priority for their business. Part of this should involve taking a detailed look at the systems on board vessels and ensuring that they are the right tools for the job. A systems focus is essential.

FUTURE-PROOFING FUEL SYSTEMS

Finding the right fuel system option will be a priority for most owners. Seen from this

perspective, retrofits of multi- or dualfuel (MDF) systems (or selecting dualfuel systems for newbuilds) will most likely cover any fuel requirements that the future might bring.

In MDF systems, one fuel system is designed to handle a low vapour pressure combustible (which is liquid at ambient pressures and temperatures), while the other fuel system is designed to handle a cryogenic, pressurised combustible (and possibly toxic) energy carrier, with both feeding into an internal combustion engine.

These systems significantly maximise flexibility as they enable a vessel to handle multiple energy carriers on board, which means that shipowners become less exposed to the risk of investing in a stranded asset.

Rather than having to bet on liquefied natural gas (LNG), ammonia, or methanol today, MDF systems partially eliminate the need for a choice now – at least on the fuel handling side. This increases stability, brings costs down and boosts market resilience in a way that undoubtedly outweighs the impact of the additional cost of MDF systems installations.

A standard dual fuel system can manage heavy fuel oil (HFO)/diesel and LNG, the diesel fuel handling side can also be converted to handle synthetic or biofuels, including methanol – with relative to minor impact as long as this was considered from the start.

Meanwhile, the other part of the dual fuel system – the one typically handling LNG – can eventually be converted to handle ammonia in the future. We could even go further by applying a liquid air energy storage (LAES) principle in shortrange applications as a low-cost, carbon-free adaptation of the LNG handling system in a potential post-LNG era.

TOUGHENING THE TANKS

Another key consideration for newbuilds is the type of tank necessary to maximise options. Newbuild buyers hope that paying extra for features such as stronger fuel tanks will lower the cost of converting a ship to ammonia or another future fuel in coming years. While it is unclear how much of a ship’s fuel system will need to be adapted until the engine technology progresses, building a more resilient fuel tank now will definitely be cheaper than replacing a standard LNG tank later.

Certainly, this multi-use solution on a dual-fuel platform – plus a combustion engine – is slightly more complex than a dedicated diesel/ LNG standard, so a marginal cost increase is inevitable.

However, MDF systems would meet the latest classification standards (ie, “ammonia-ready notation”) and allow shipowners to sail confidently ahead into the future.

Hydrogen will place stricter demands on fuel tanks. The question is still open as to whether hydrogen’s small molecules can affect and eventually weaken the properties of the steel when in contact.

Høglund is currently working with steel specialists and tank designer specialists on building a tank that can be used for transporting liquid hydrogen.

THE CASE FOR GOING HYBRID

The other essential part of the equation is the need to use less fuel overall. Future fuels will be more expensive than current fuels and less energy dense. One of the best tools at our disposal to counter this is hybrid power, which has far greater benefits than simply being a store of energy.

Hybrid power opens a world of opportunities as it shifts away from traditional power systems and disrupts the classic, internal combustion engine (ICE)-based technical paradigm for vessel power management by decoupling the electrical and power systems.

Currently, fossil fuels and oil are inextricably linked with the ICE and this relationship has determined the evolution of shipping technology for more than 100 years. The adoption of hybrid power systems is one of the most significant changes that decarbonisation will have on ship technology and it creates a series of unique challenges and opportunities.

The fundamental method of power exchange in a vessel with hybrid power systems will be the transmission of chemical energy to an electrical convertor – rather than chemical energy to a rotating convertor, which is currently the basis of the ICE.

Moreover, as future energy will be harder to obtain – especially as it will have to come from excess renewable energy, in the form of hydrogen, ammonia, etc – shipping companies will need to make the most of these new, more efficient transfer mechanisms and the new wave of innovation they will lead.

By decoupling propulsion from electrical systems, hybrid solutions can, for example, allow propellers and cargo discharge pumps to work at different speeds while also providing valuable backup emergency power using variable speed shaft generators (VSSG). VSSGs give the crew more control over the power supplied to the propeller, with additional generators supplying power to the propeller at different speeds when necessary. The hybrid drive allows excess energy from the propeller shaft to be recovered and re-used for additional power when needed, reducing overall power consumption – all efficiencies that are intrinsically linked to hybrid propulsion.

Høglund has been commissioned to supply systems of this kind for two asphalt carriers for Tipco, leading manufacturers and distributors of asphalt products, to be built in Wuhu shipyard, China.

The overall effect of these innovations is that the vessel will be able to operate at greater efficiency over a wider range of speeds and propeller pitches, with a smaller main engine. It also allows the cargo discharge pumps to operate at different speeds, increasing the range of terminals they can discharge at and giving additional flexibility in loading and unloading locations. The hybrid drive allows excess energy from the propeller shaft to be recovered and re-used for additional power when needed, reducing overall power consumption and providing valuable backup emergency power. PUTTING IT INTO PRACTICE

Høglund’s recent projects demonstrate how it’s possible to bring these technologies together to create the next generation of more efficient ships – and how automation systems are essential in bringing these technologies together. For example, we were recently commissioned to supply advanced hybrid and automation systems for six hybrid bulk vessels, with potential for six more, on order for Finland’s ESL Shipping, a leading carrier of dry bulk cargoes in the Baltic region.

These 1A ice class bulk vessels will reduce GHG emissions – including CO2 – per cargo unit transported by almost 50% compared to ESL’s existing ships, making the vessels the most efficient in the world in their class.

The vessels will use batteries, shore-side electricity solutions and electric hybrid solutions to enable completely emission-free and noisefree port calls, being able to arrive and leave port with electric power alone.

Høglund will supply automation and hybrid systems for these vessels. Our Integrated Automation Systems (IAS) will link alarm monitoring, control and power management systems, giving crew and shoreside teams reliability and control over the vessel’s systems. The IAS will integrate with Høglund’s cloud-based ship performance monitor (SPM), using data from the automation systems to monitor performance in real time.

As alternative fuels enter the market, and pressure grows on owners to decarbonise, it can be hard to predict fuel choices, considering different ships have radically different needs and options. However, for most vessels, it’s still too early to accurately predict what they will be using in the years and decades to come. If owners take a forensic look at energy management, with careful attention to the systems they choose, it will set them up to take advantage of the widest set of options possible, ensuring their fleet can keep its options open and remain future proof amid future fuel uncertainty.