A new report released on Thursday (3 October) by the Zero Emission Maritime Buyers Alliance (ZEMBA) and Lloyd’s Register Maritime Decarbonisation Hub found that e-fuel-powered shipping services are projected to be available for ZEMBA’s next tender. 

Specifically, the report – which summarises the findings from a request for information (RFI) that the two organizations co-ran earlier in 2024 – found sufficient predicted supply of both e-methanol and e-methanol-capable vessels in the container segment to support ZEMBA’s focus on e-fuel deployment. 

ZEMBA’s next tender is expected to launch in early 2025, with the aim to purchase the environmental attributes associated with e-fuel powered services starting in 2027.

“ZEMBA's aim is to open the door to new and increasingly scalable solutions through each of our tender processes,” said Ingrid Irigoyen, President and CEO of ZEMBA.

 “Because there are scale limitations to those low carbon fuels that rely on biogenic feedstocks, rapid deployment of hydrogen-derived e-fuels this decade is crucial to ensure that the maritime sector gets on a 1.5 aligned pathway toward full decarbonisation by 2050, at the latest.

“We’re pleased that the RFI results suggest that the maritime sector will be ready to provide ZEMBA’s climate-leading freight buyer members with e-fuel powered shipping for our next tender.” 

Nearly 50 ship operators and fuel suppliers from around the world responded to the ZEMBA RFI, which was intended to assess the market readiness of commercial deployment of e-fuels in shipping. 

The report focuses on the implications of the RFI's results for ZEMBA’s next tender and how these findings relate to overarching trends in commercial deployment of e-fuels in the maritime sector. The RFI did not ask about the projected cost or price of e-fuel-powered services.

“The results of the RFI offer a valuable glimpse into the emerging market for e-fuels and e-fuel-capable vessels,” said Dr Carlo Raucci, Director of Sustainable Fuels and Strategy at Lloyd's Register Maritime Decarbonisation Hub. 

“Despite the current gap between e-fuel supply and vessel availability, it's encouraging to see the potential for e-fuels to make a significant impact on the maritime sector. We're excited to collaborate with ZEMBA on their second tender, which could be instrumental in driving the widespread adoption of scalable e-fuels in shipping.”

ZEMBA’s upcoming tender builds upon lessons learned during its inaugural tender, which was successfully completed in April 2024. Global carrier Hapag-Lloyd was the winner of the first tender and is supporting members to collectively avoid at least 82,000 metric tonnes of CO2e in 2025 and 2026. 

The majority of RFI respondents predicted that commercial e-fuels deployment in the maritime sector would be feasible starting in 2027 and 2028, with limited deployment potentially as early as late 2026. However, in the next few years, the RFI results identified a mismatch in the supply of certain e-fuels and corresponding e-fuel capable vessels on a fuel-by-fuel basis. 

Containerships capable of operating on e-methane are already available now, but the RFI found no e-methane production projects post-final investment decision (FID). 

Conversely, e-ammonia production projects under construction appear to be sufficient to meet ZEMBA’s estimated demand, but the first e-ammonia-capable containerships are unlikely be on the water by 2027. 

The RFI suggests e-methanol is the most likely pathway for ZEMBA’s next tender because of alignment between sufficient projected e-methanol fuel production and e-methanol-capable containership vessels on the water in 2027. 

However, across fuel types, the report highlights that a significant number of e-fuel projects remain at pre-FID stage, casting doubt on whether those projects would begin production on their projected timelines and, related, if e-fuel-capable dual fuel vessels will actually run on e-fuels. 

One finding from ZEMBA’s inaugural tender was that announcements for e-fuel development projects often do not correlate to commercial readiness within predicted timeframes. ZEMBA received no e-fuel-powered bids for its first tender. 

Commitments from ZEMBA members for e-fuel-powered shipping services through the next tender will aim to provide encouragement to ship operators and others across the maritime value chain to enter into longer term offtake e-fuel contracts of their own. 

ZEMBA intends to announce details about its next e-fuel-focused tender before the end of 2024, with the aim to solicit bids in early 2025. Ahead of this tender, ZEMBA is recruiting additional climate-leading companies who are seeking to credibly reduce their Scope 3 emissions, manage long-term cost of the energy transition, and kickstart a zero-emission market in the maritime sector. 

Note: The report can be found here.

Photo credit: Chris Pagan on Unsplash
Published: 4 October, 2024 

Latest figures from classification society DNV’s Alternative Fuels Insight (AFI) platform saw a total of 17 new orders for alternative fuelled vessels were placed in September 2024. 

DNV said LNG was the biggest driver, accounting for nine vessels, with most of these coming from the container segment. The remaining eight orders were for methanol fuelled vessels.

Although it was a relatively slow month for alternative fuelled vessel orders, it follows the two strongest months of the year in July and August, where 81 and 95 new orders were placed. 

“In both months, LNG was the main fuel of choice, accounting for 53 and 55 new orders respectively.  Order uptake continues to be dominated by the container segment, which accounted for around two-thirds of all orders in the third quarter of 2024,” it said. 

Overall, the steady momentum in the alternative fuelled orderbook remains. A total of 370 alternative fuelled vessels were ordered in the first three quarters of 2024, representing year-on-year growth of 24%.

Jason Stefanatos, Global Decarbonization Director at DNV Maritime, said: “Despite a slow month in September, a broader view confirms that the momentum in the new order market towards alternative fuelled vessels remains strong.

“LNG is clearly the headline story since the summer, accounting for around 60% of all alternative fuelled new orders in the third quarter mainly thanks to a strong uptake in the container segment.

“Although 49 new orders for methanol fuelled vessels were registered in the third quarter, only eight of these were placed in September, demonstrating a slight stagnation.”

Photo credit: DNV
Published: 3 October, 2024 

International fuel additives company Infineum on Tuesday (1 October) published an article on its Insight website assessing the ways that fuel and lubricant additives can help improve efficiency and reduce emissions today and support future fuel options:

With the International Maritime Organization’s countdown to net zero emissions inexorably ticking down, the industry is looking for cost effective, readily available options to meet the interim targets, while also exploring ways to meet the 2050 net zero goal. Infineum’s Rob Glass and Dewi Ballard explore the ways that fuel and lubricant additives can help improve efficiency and reduce emissions today as the industry works to fully commercialise future fuel options such as ammonia.

Following on from the International Maritime Organization (IMO) 2020 sulphur cuts, probably the largest regulatory change to fuel composition that the maritime industry has ever seen, the IMO has now set a path to reach net zero greenhouse gas (GHG) emissions by 2050.

IMO says international shipping, which transports some 90% of global trade, is statistically the least environmentally damaging mode of transport when its productive value is considered. But, in its most recent study, the organisation reports CO2 emissions from ships are estimated to have increased by more than 9% from 2012 to 2018. Reversing this trend is a key goal and a big driver for change.

In its revised greenhouse gas reduction strategy, adopted in July 2023, IMO has set out very clear ambitions, aiming for net zero greenhouse gas emissions as close to 2050 as possible.

The IMO timeline also includes a commitment to ensure the uptake of zero and near zero greenhouse gas fuels by 2030, with checkpoints along the way.

From January 2023, it became mandatory for ships to calculate their attained Energy Efficiency Existing Ship Index (EEXI) and to start fuel consumption data collection. The first annual reporting on fuel consumption is complete, which means the first CII ratings, from A down to E will be made this year – with a target of C or better.

Clarksons Research estimates that more than one third of the deep sea cargo fleet will be rated D or E. But those achieving a C rating or higher cannot be complacent because the CII reduction factor increases yearly, which means more are likely to slip into D and E categories by 2026. IMO is set to review the effectiveness of its implementation by 1 January 2026, and if needed adopt further amendments. Penalties for non-compliance could also be introduced as part of these measures.

The good news is that the IMO targets are technology neutral, which means ship owners and operators are free to decide how best to gain and retain a C or better rating. What this means for the wider industry is increased complexity - a wider range of fuels, fuel blends and engine types, which increase the demand on the lubricant in use – and new additive technologies will be needed to help ensure trouble free operation.

There are already a number of GHG reduction options to choose from, which may require investment or impact profitability. Some of the largest GHG savings come from fuel selection.

However, the wide availability of net zero carbon fuel options is still some way off, which means, other carbon cutting measures are needed to help ships improve reduce fuel consumption without significantly increasing running costs.

Note: The full article by Infineum can be found here.

Photo credit: Infineum
Published: 3 October, 2024