The maritime industry is in the midst of a once-in-a-century energy transition and decisions made on future fuels will persist for decades.
That’s why we must focus on energy sources that will deliver the long-term emissions reductions we need instead of those that offer partial solutions.
Many think a bridge fuel, like liquefied natural gas (LNG), will be a necessary yet temporary solution as the maritime sector decarbonizes.
But LNG is not a viable bridge fuel for commercial ships because it still emits a lot of greenhouse gases compared to alternatives.
The types of fuels vessel owners and operators invest in today matters. They’ll commit tens or hundreds of millions of dollars to new ships that will be around for 30 or more years. Ship engines and fuel systems are a significant chunk of the overall vessel cost and are designed for certain fuels.
For the past 100 years, heavy fuel oil (HFO) has been the dominant energy source for maritime transport. The fuel is relatively cheap and stable in price, energy dense and widely available. It has enabled massive growth in both ship and market size.
Today, the maritime sector uses about 330 million metric tons of the stuff each year to power the ships that facilitate global trade. That’s roughly 147,000 Olympic swimming pools worth. We are swimming in fuel oil.
The consumption of all that fuel oil results in approximately one billion metric tons of greenhouse gas (GHG) emissions annually, around 3% of all human produced emissions according to the International Maritime Organization (IMO). As of July 2023, the IMO updated the maritime industry’s emissions reduction target, aiming for net zero by 2050 with interim targets along the way.
Liquid and gaseous fuels are familiar to the maritime sector and significant infrastructure and know-how is already in place that facilitate their continued use.
The list of viable alternatives to heavy fuel oil can be winnowed down to five main contenders: methanol, ammonia, biofuels, liquefied natural gas and hydrogen.
Just like beer, each fuel comes in many different variations. The ingredients (or feedstocks) and production methods are the main distinguishing characteristics. When we consider all these variations, the true number of fuel options is immense.
Each fuel variation has a different emissions profile depending on which feedstocks are used, how the fuel is produced, stored and transported and ultimately consumed aboard the ship. This holistic view of a fuel’s total emissions across its full lifecycle is referred to as its well-to-wake emissions.
When using this well-to-wake approach, some biofuels, methanol and ammonia synthesized using renewable energy and sustainable feedstocks have more than 80% lower emissions compared to heavy fuel oil.
However, even two fuels with the same name may have drastically different emission footprints. Methanol produced with sustainable feedstocks (like biomass from municipal solid waste) and renewable energy could have well-to-wake emissions 80% lower than methanol produced using natural gas, for example.
Today, based on global ship construction data compiled by the ship classification society DNV, the most selected alternative fuel for new vessels is LNG. LNG is not a new fuel, but within the last decade it has become more popular.
LNG is primarily composed of methane, a hydrocarbon and greenhouse gas. When burned, it produces about 20 to 30% fewer CO2 emissions than heavy fuel oil. But when considered on a well-to-wake basis, LNG’s emissions are only 3% lower than emissions from heavy fuel oil, according to the Greenhouse gases, Regulated Emissions, and Energy use in Technologies (GREET) model developed by the U.S. Energy Department’s Argonne National Laboratory.
In other words, while LNG has some marginal benefits, it is not aligned with long-term industry targets.
Ships are long-lived assets; the vessels being built today will still be operating in 2050. As more ships are built with engines and fuel systems specifically designed for LNG, it creates greater demand for the fuel, which leads to yet more dedicated infrastructure, creating further incentives for ship owners to adopt the fuel.
As of June 2022, by capacity, more than one-third of new container ships and more than half of cruise ships on order will be capable of using LNG, per research from the nonprofit International Council on Clean Transportation. This short-term focus on LNG redirects investment from other fuels and ships that could be long-term solutions.
The maritime sector has other options in biofuels, methanol and ammonia.
Most large marine engines require no major retrofits or redesigns to use low-carbon biofuels. Methanol-compatible marine engines are commercially available from major engine manufacturers, and ammonia-compatible engines will be available within the next year or two. Low-carbon variants of biofuels, methanol and ammonia are not yet produced in significant volumes, but with greater investment and demand production will scale accordingly.
In fact, Maersk, CMA CGM, China Ocean Shipping Company (COSCO) and Evergreen, some of the largest shipping companies in the world, have collectively ordered almost 80 methanol-ready ships that will enter service in the next couple years. Many more ships, and the fuel to power them, are needed.
The maritime sector is transitioning away from heavy fuel oil. It is vital that the sector’s next fuel of choice can deliver the emissions reductions we need well-ahead of 2050.