Mr Dave Gregory, Managing Director of North Europe for Baseblue, was interviewed by Hellenic Shipping News regarding the potential avenues for decarbonizing shipping. According to Mr Gregory, he believes that the shipping industry will face challenges in meeting the 2030 mandates set by the International Maritime Organization (IMO). Baseblue is a company formed by the merger of three prominent bunkering companies, namely Bunkernet, BMS United, and SBI Bunkering BV. The company’s global network actively supports the shipping industry in transitioning towards a more sustainable future, as reported by Hellenic Shipping.
A recent study by Mckinsey concluded that the future of bunkering would involve three or even four different fuel types and corresponding supply chains. Do you share this view?
DG: there isn’t a single fuel that can meet the needs of the entire commercial shipping fleet. Different vessel types and operational patterns require fuels with different properties. In the short term, biofuels are attractive to shipowners due to their availability. They can be used as drop-in fuel with minimal changes to infrastructure or engine performance, and they are increasingly accessible in many ports. However, the widespread use of biofuels in other industries like land transport and aviation poses a competitive risk for the shipping industry. Unlike solar and wind energy, biomass used for biofuel production is not immediately renewable, as it takes time to grow crops, trees, and animals. Therefore, the future of bunkering is expected to involve a mix of fuel types for shipowners to choose from.
Which fuels hold the most potential in the long term to lead shipping towards a net-zero future from 2050 onwards?
DG: Liquid fuels have an advantage over gaseous fuels in terms of higher fuel density and smaller storage requirements. However, there can be an energy penalty associated with certain liquid fuels like LNG and hydrogen, which require low-temperature, high-pressure storage. Hydrogen, although carbon-free, presents challenges due to its extremely lightweight nature and the need for specialized handling. Containment is a concern, and leaks can lead to quick tank depletion. Additionally, in its raw state, hydrogen is an indirect greenhouse gas.
In the long term, methanol emerges as a strong contender, especially when combined with carbon capture technology. Carbon dioxide (CO2) capture is already widely used in various industries, and if it becomes economically feasible to capture CO2 onboard ships, it would benefit the environment and create a revenue stream for shipowners. Methanol offers potential as a sustainable fuel option for the shipping industry.
Will the first cut-off date of 2030 be delayed further, or is there still enough time for shipping to adjust to the goal of reducing emissions?
DG: the shipping industry is expected to face challenges in meeting the International Maritime Organization’s (IMO) mandates set for 2030. The construction of new fuel infrastructure and the investment in onboard technology takes time and can be financially challenging for older vessels. Shipowners may find it economically unfeasible to make substantial modifications to their ships. As the deadline approaches, Mr Gregory anticipates that regulators will need to collaborate with shipowners to determine what is realistically achievable within the given timeframe.
What are the main hurdles today when developing the necessary fuel technologies and supply chains?
DG: According to me, regulatory uncertainty is a major hurdle in the shipping industry’s decarbonization efforts. It affects investment in infrastructure, and finance for new ships or upgrades, and creates an uneven playing field. Greater clarity is needed to address these challenges, and the upcoming MEPC 80 in July presents an opportunity to provide industry-wide clarity.
Carbon insetting is proposed as a way to support the transition to decarbonization. Unlike carbon offsetting, carbon insetting involves directly reducing emissions within the shipping value chain. It allows owners and operators to reduce emissions on vessels where practical, regardless of location. This approach avoids directing money away from the shipping industry and supports the necessary technological shift towards carbon-neutral shipping solutions.
Currently, alternative fuels have limited availability, and varying prices, and not all vessels are ready to use them. Carbon insetting helps bridge this gap by decoupling carbon reduction from specific transport activities and enabling the greening of overall transport operations. It expedites the energy transition in shipping, addressing the price disparity between fossil fuels and renewable alternatives. The insetting system redirects funds back into the shipping sector, forming a new carbon economy and promoting the adoption of cleaner fuels.
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Source: Hellenic Shipping
