Emerging tech can create a green global shipping industry.

With fossil fuels still generating approximately 99% of the world’s shipping power, the sector is looking to reduce emissions by using cleaner fuel sources – methanol, ammonia and wind – in the near future.

Last month, Breakthrough Energy Ventures, a consortium of private investors founded by US tech entrepreneur Bill Gates, raised $37 million in Danish startup Blue World Technologies to help scale up production of a technology system that extracts hydrogen from methanol and transfers it into fuel cells. Generating fuel savings of up to 30% compared to an internal combustion engine.

In recent years, international shipping lines have been taking similar steps. Danish shipping giant AP Moller-Maersk has committed $2.1 billion to reduce emissions from methanol-powered ships by 4% by 2024, and could purchase a Blue World methanol system in a future order. Chinese shipping giants COSCO Shipping and China Merchants Group are also looking to use methanol as an alternative fuel source.

In the year In 2018, the United Nations International Maritime Organization It has set a 2050 target to reduce greenhouse gas emissions from the shipping sector by 50% compared to the 2008 baseline. To achieve this goal, the organization issued new regulations in 2020 that limit the maximum sulfur content in marine fuel to 0.5%, which is lower than the previous limit of 3.5%.

But it accounts for 3 percent of total global emissions and the sector’s emissions may not be enough to reach the net-zero goal by 2050, according to the International Energy Agency.

The agency In its November 2021 monitoring report on the shipping industry, it said: “Current short-term measures are not very promising to put shipping on a net-zero path.” Medium- and long-term measures need to be implemented quickly. . Such measures should establish a stable, long-term regulatory framework to encourage shipowners, operators, financiers and fuel suppliers to invest in the rapid development and adoption of technologies necessary to achieve net-zero alignment, but are still at the observation/prototype stage.”

A shift to cleaner fuels – rather than focusing on reducing emissions from current fossil fuel-based systems – is seen as a necessity, giving greater importance to innovations such as Blue Earth technology. This is especially true for ships of 5000 gross tons or more, which account for 85% of net greenhouse gas emissions in the sector.

It can also embrace the combination of new fuels and other carbon removal technologies such as carbon capture and distillation. For example, captured carbon can be used to produce renewable methanol.

Alternative marine fuels

Like methanol, ammonia produced from hydrogen or other clean energy sources using electrolyzers holds great promise as an alternative fuel for ships to reduce emissions. In addition to ammonia’s high energy content, many countries have transportation and storage infrastructure that facilitates rapid adoption.

Ammonia is still in the early stages of technological development to be applied in ships, but investment is gathering pace. In August, the U.S. Bureau of Shipping issued preliminary approvals for ammonia-powered ships and infrastructure, including a design from global shipbuilding giant Samsung Heavy Industries.

Earlier this year, US-based Amogy raised $50m to use ammonia in fuel cells, which would create even more significant emissions reductions.

Pure hydrogen, often used to produce ammonia and methanol, also has potential, although current technology only allows it to be used for small vessels such as yachts and passenger ferries. Storage limitations and the need to renew existing fleets make hydrogen an unlikely bulk fuel source in the medium to medium term.

However, if the hydrogen trade expands internationally, Regions such as Latin America aim to become a large exporter of hydrogenIt can play a key role in meeting the 2050 net-zero goals.

Coal dominated transportation in the 19th century, just as oil dominated supply in the 20th century. A viable green fuel for the global shipping industry.

Ample supplies of natural gas (LNG), for example, have helped to make gas as an auxiliary fuel to traditional diesel bunker fuels a major contributor to shipping because ships can easily refuel at storage facilities around the world.

Although based on fossil fuels, LNG is classified as a transition fuel by the EU, and ships burning LNG are estimated to produce 99% less particulate matter and sulfur oxides than conventional fuels, as well as a 25% reduction in carbon emissions. Dioxide.

In September 2022, the Port of Long Beach, California, refueled a container ship with LNG for the first time in the port’s history.

Finally, in a trend associated with the fossil fuel era, some shipping companies are looking at using wind power. Large sails on cargo ships can increase propulsion by 5-20% when used with other fuel sources, according to the International Wind Energy Association.

Related: Unintended consequences of EU energy emergency plan

By the end of 2022, two dozen ships will use some form of wind power. For example, US giant Cargill, which charters around 600 vessels, is incorporating a design that includes Mitsubishi-37.5m sails. A privately owned ship, it plans to launch the ship in 2023.

New markets such as green fuel hubs

Emerging markets have an important role to play in accelerating the clean fuel transition in the transportation sector.

With this year’s presidency of the G20 and next year’s presidency of the Association of Southeast Asian Nations, Indonesia is uniquely poised to shape the transition to greener fuels in global shipping and elsewhere.

Singapore is traditionally a leader in storing fossil fuels for ships, but Indonesia has more than 17,000 islands that could strategically build ammonia and hydrogen green fuel storage facilities, according to a report published in August by the P4G-Getting to Zero Coalition. Partnership.

The report estimates that the development of the country’s zero-emission fuel infrastructure could generate between $3.2 billion and $4.5 billion in investment by 2030.

Indonesia has the climate and economic incentives to use its position to accelerate the energy transition with clean domestically produced sources of hydrogen and ammonia to realize such visions.

South Africa is similarly looking to build a green fuel corridor along its coast and has proposed green hydrogen export port projects at Bogobai, Saldanha Bay and Durban-Richards Bay, which will boost these ports with green fuel.

Elsewhere, Baja California and Manzanillo on Mexico’s Pacific coast are being discussed in this direction, as the country has enough solar and wind power to power green fuel hubs for the global shipping industry.

Oxford Business Group

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