The ship.energy report 09/10/2020

The ship.energy report 09/10/2020

Weekly briefing from ship.energy

Commentary: Joining all the dots

In the run-up to 2020 and the implementation of the IMO’s mandate on a global 0.50% sulphur cap for marine fuels, much was made about the likely availability of IMO 2020-compliant fuels in the transitional phase of the great fuel switchover. Would the new very low sulphur fuels oil be available in many global ports – and at the quantities required by owners and operators?

We know now that the IMO 2020 transition went pretty smoothly, but there were supply ‘outages’ in some of the smaller ports around the world.

The bunker supply infrastructure around the world is a very well-oiled machine (forgive the pun), so if IMO 2020 presented the industry with some logistical and availability challenges, the creation of a global supply infrastructure for shipping’s next generation fuels is going to require some heavyweight problem-solving.

Lloyd’s Register’s Director of Marine & Offshore, Nick Brown, identified the nub of the problem this week when he addressed the first annual UN Global Compact CEO Roundtable on the decarbonisation of shipping. He told participants that land-based infrastructure is lagging behind the development of zero-carbon ships.

‘It is hugely positive that so many in the maritime industry are moving forward with decarbonisation initiatives, and we expect to see deep-sea Zero Carbon Emission Vessels technically ready to be in the water by 2024.

‘There is a real possibility landside infrastructure and fuels will not be ready by then, therefore this calls for greater international government policy and incentives and cross-industry collaboration,’ he said.

Many would argue that the uptake of LNG as a shipping fuel was held back because the supply infrastructure was slow to develop. It is only in the past few years that supply has been scaled up at some global ports as larger LNG bunker tankers have begun to enter the global fleet.

So the industry is going to have to scale up production of new fuels in tandem with a joined-up supply infrastructure, but how does it do this without knowing which (fuel) horses to back? There are many promising energy contenders out there but there are no real certainties as yet over which will be the successful candidates for commercial scalability.

In this week’s ship.energy podcast, Dr Lucy Gilliam, Aviation and Shipping Campaigner at NGO Transport & Environment, discusses the decarbonisation challenge. She doesn’t think LNG is the way to go for shipping, but whether you agree with her or not, she makes the point that establishing the bunker supply infrastructure for LNG has required a massive investment by many stakeholders. If the predictions from some quarters of the shipping sector are realised and LNG ultimately becomes a stranded asset, at what cost to the industry? And what should future fuel producers be taking away from this (hypothetical) scenario?

It seems that we are not going to be able to dispatch the ‘chicken and egg’ tag any time soon in the decarbonisation debate…

 

 

 

 

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