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Gasum: Shipping companies must be prepared for the tightening EU regulations

Gasum released an insight on the upcoming EU regulations including Fit for 55 regulatory package, FuelEU Maritime and EU Emission Trading System, while also touching on cleaner bunker fuels.

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Gasum: Shipping companies must be prepared for the tightening EU regulations

Nordic energy company Gasum released an insight on the upcoming EU regulations including Fit for 55 regulatory package, FuelEU Maritime regulation and EU Emission Trading System (ETS) while also touching on cleaner bunker fuels: 

Shipping companies must prepare for stricter EU regulations as the European Union tightens emissions rules for the maritime sector. New regulations and customer demands will drive the need for low-emission maritime fuels like renewable biogas and synthetic methane. Gasum stands ready to assist its customers in compliance and emissions reduction.

The European maritime industry faces significant changes impacting all companies operating in European waters. Under the EU's Fit for 55 regulatory package, companies must reduce the greenhouse gas intensity of the energy used by vessels. In practice, this means companies need to buy low or zero emission fuels.

The forthcoming FuelEU Maritime regulation will mandate a 2% reduction from 2020 levels in fleet greenhouse gas emissions by 2030, escalating to 80% by 2050. Additionally, the EU Emission Trading System (ETS) will affect the maritime industry for the first time in 2024. Companies using fossil fuels will need to purchase and use EU ETS emission allowances for each tonne of reported CO2 emissions.

"The scale of change will be significant, with five directives tightening maritime emissions rules. Companies must assess their vessel operations and transition to low-emission fuels promptly. At Gasum, our mission is to ensure our customers' long-term compliance with available low-emission fuel options, such as LNG, fully renewable biogas, or synthetic methane," says Jani Arala, Gasum's Head of Sustainable Logistics Solutions.

The demand for low-emission biofuels is set to increase

The demand for low-emission biofuels is set to rise due to these regulations, and Gasum is committed to meeting its customers' needs. Gasum plans to introduce an additional 7 TWh of biogas by 2027, reducing emissions and addressing the growing demand for biofuels in the maritime sector.

Gasum is also actively participating in the emerging synthetic fuel market, aiming to provide more emission-free synthetic methane. Another potential synthetic fuel is green and e-methanol, but they face challenges in terms of vessel engines capable of utilizing methanol and the necessary bunkering infrastructure.

Electric engines are gaining traction for short-range travel, while long-haul electric shipping remains challenging due to, among other things, space requirements.

"In the long term, compliant cleaner maritime fuels like LNG, LBG, and synthetic methane are viable options due to availability and futureproofing. Dual-fuel engines allow ships to transition cost-effectively, and LNG dual fuel vessels can use all renewable and e-methane types as 'drop-in' fuels, with solid LNG vessel order books," Jani Arala adds.

Portfolio management services bring competitive advantage when dealing with ETS

In 2024, the maritime industry faces a significant shift with the Emission Trading System (ETS), which mandates companies to purchase emission allowances for fossil fuels used. Unlike some sectors, the maritime industry does not receive free allowances.

The EU ETS will gradually impact shipping companies. In the first year, they must offset 40% of maritime emissions, with this requirement reaching 100% after three years in 2027.

For shipping companies relying on fossil fuels, this will lead to significantly higher costs, inevitably affecting customer prices. One option for shipping companies who participate in ETS is to outsource allowance purchasing or otherwise seek help from portfolio management services.

Gasum offers comprehensive portfolio management services related to EU ETS with capabilities of taking care of the whole process on customers’ behalf.

"Timely allowance purchases within the EU ETS can be a complex and dynamic endeavor, necessitating specialized knowledge. We have observed, alongside our clients, that outsourcing emission trading is often a cost-effective and practical choice. Gasum's dedicated specialists monitor market conditions, ensuring our customers with predictability and transparency regarding allowance costs, risk reductions in price and volume risks, and ultimately lower costs and less stress," Jani Arala explains.

Photo credit: Gasum
Published: 16 November, 2023

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Bunker Fuel

Singapore: Bunker fuel sales down by 9.1% on year in January 2025

4.46 million mt of various marine fuel grades were delivered at the world’s largest bunkering port in January, a drop from 4.91 million mt recorded during the similar month in 2024, according to MPA data.

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Singapore: Bunker fuel sales down by 9.1% on year in January 2025

Sales of marine fuel at Singapore port decreased by 9.1% on year in January 2025, according to Maritime and Port Authority of Singapore (MPA) data.

In total, 4.46 million metric tonnes (mt) (exact 4,461,710 mt) of various marine fuel grades were delivered at the world’s largest bunkering port in January, a drop from 4.91 million mt (4,906,100 mt) recorded during the similar month in 2024.

Deliveries of marine fuel oil, low sulphur fuel oil, ultra low sulphur fuel oil, marine gas oil and marine diesel oil in January (against on year) recorded respectively 1.66 million mt (zero from 1.66 million mt), 2.43 million mt (-15% from 2.86 million mt), 900 (+100% from zero), 3,100 mt (-77% from 13,500 mt) and zero (from zero).

Singapore: Bunker fuel sales down by 9.1% on year in January 2025

Bio-blended variants of marine fuel oil, low sulphur fuel oil, ultra low sulphur fuel oil, marine gas oil and marine diesel oil in January (against on year) recorded respectively 16,000 (+100% from zero), 92,000 mt (+103% from 45,300 mt), zero (from zero), zero (from zero) and zero (from zero).

LNG and methanol sales were posted respectively at 6,600 mt (-36.5% from 10,400) and zero (from zero).

A complete series of articles on Singapore bunker volumes by Manifold Times in 2024 can be found below:

Related: Singapore: Bunker fuel sales down by 5.2% on year in December 2024
Related: Singapore: Bunker fuel sales gain by 4.6% on year in November 2024
Related: Singapore: Bunker fuel sales gain by 10.8% on year in October 2024
Related: Singapore: Bunker fuel sales continue to increase by 2.8% on year in September 2024
Related: Singapore: Bunker fuel sales increase by 7.2% on year in August 2024
Related: Singapore: Bunker fuel sales up by 3.3% on year in July 2024
Related: Singapore: Bunker fuel sales gain 8.7% in June 2024
Related: Singapore: Bunker fuel sales increase by 6.7% in May 2024
Related: Singapore: Bunker fuel sales down by 0.6% on year in April 2024
Related: Singapore: Bunker fuel sales increase by 6.4% on year in March 2024
Related: Singapore: Bunker fuel sales up by 18.8% on year in February 2024
Related: Singapore: Bunker fuel sales up by 12.1% on year in January 2024

 

Photo credit: Maritime and Port Authority of Singapore
Published: 14 February, 2025

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Bunker Fuel

Singapore-based Straits Bio-LNG aims to deliver 250,000 mt of bio-LNG bunker fuel per year

Firm is currently in advanced stage of testing breaking down Empty Fruit Bunch through an established biological process with high enzyme concentration in its R&D facility in Malaysia to produce bio-LNG.

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Singapore-based Straits Bio-LNG aims to deliver 250,000 mt of bio-LNG bunker fuel per year

Straits Bio-LNG, a privately owned supplier of bio-LNG, is aiming to deliver 250,000 metric tonnes (mt) of bio-LNG per year in Singapore, according to SEA-LNG on Thursday (13 February).

The Singapore-based company, led by SK Tan as CEO, is doing so in response to the growing demand for LNG. LNG bunkering volumes have grown significantly in key bunkering hubs as more LNG-fuelled vessels have entered into operation. 

The Maritime and Port Authority of Singapore (MPA) saw a dramatic four-fold increase in 2024 to almost 340,000 mt, SEA-LNG said in a statement announcing Straits Bio-LNG joining the coalition. 

Headquartered in Singapore, the company boasts a growing team led by SK Tan as CEO.  

Yiyong He, Director at Straits Bio-LNG, said: “We’re firmly convinced in the viability of the LNG pathway to decarbonise the shipping industry. With its very low carbon intensity and improving commerciality, liquified biomethane will be a critical piece of the puzzle for decarbonising the sector.”

“By joining SEA-LNG, we’re proud to be part of a collection of first movers making real strides to make the LNG pathway a tangible reality today.”

Straits Bio-LNG aims to reach its bio-LNG supply goal by using pioneering methods. It is currently in the advanced stage of testing breaking down Empty Fruit Bunch (EFB) through an established biological process with high enzyme concentration in its R&D facility in Malaysia. 

Both Palm Oil Mill Effluent (POME) and EFB are sustainable biomass resources listed in the “List of Materials Eligible for ISCC EU Certification” and are therefore compliant with the European Union’s Renewable Energy Directive (RED).

Peter Keller, chairman of SEA-LNG, added: “The Port of Singapore is the largest global bunkering hub. As seen in our View from the Bridge report, 2024 saw record growth in LNG and liquified biomethane bunkering, but we need more fuel to meet upcoming demand.”

“The use of liquefied biomethane as a marine fuel can reduce GHG emissions by up to 80% compared to marine diesel on a full well-to-wake basis. When produced from the anaerobic digestion of waste materials, such as manure, POME or EFB, methane that would otherwise be released into the atmosphere is captured, resulting in negative emissions of up to -190% compared with diesel."

An independent study by the Maritime Energy and Sustainable Development Centre of Excellence at Nanyang Technical University in Singapore found that pure bio-LNG could cover up to 13% of the total energy demand for shipping fuels in 2050, rising to 63% for a 20% blending ratio. 

SEA-LNG added MPA has firmly established itself as a leader in the LNG pathway, with suppliers such as Straits Bio-LNG reinforcing this position. 

Recently, the port launched an Expression of Interest (EOI) to explore scalable solutions for sea-based LNG reloading to complement the existing onshore LNG bunkering storage and jetty capacities and the supply of e/bio-methane as marine fuel in the Port of Singapore.

“Straits Bio-LNG will play a critical role in furthering the expansion of liquified biomethane at scale to meet the demand and continuing to showcase the LNG pathway as a practical and realistic solution for shipowners to decarbonise their operations, starting today,” it said. 

Related: Singapore: MPA launches EOI to expand LNG bunkering services amid growing demand

 

Photo credit: Straits Bio-LNG
Published: 14 February, 2025

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Alternative Fuels

South Korea to invest USD 154 million into construction of environment-friendly ships

Government, local governments, and public institutions plan to invest approximately KRW 222.3 billion (USD 154 million) to support the building or conversion of 81 environment-friendly ships.

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RESIZED Lauren Seo on Unsplash

The Ministry of Oceans and Fisheries (MOF) Tuesday (11 February) announced that it has prepared the 2025 Implementation Plan for Environment-Friendly Ship Distribution in accordance with the first Master Plan for Environment-Friendly Ship Development and Distribution (2021-2030).

The government enacted the Act on the Promotion of Development and Distribution of Environment-Friendly Ships in December 2018 to mandate the public sector to build environment-friendly ships and provide the private sector with a legal basis to reduce acquisition taxes and provide subsidies when converting into environment-friendly ships. 

As a result, 199 ships were converted into environment-friendly ships as of last year.

This year, the government, local governments, and public institutions plan to invest approximately KRW 222.3 billion (USD 154 million) to support the building or conversion of 81 environment-friendly ships.

The public sector plans to build a total of 34 environment-friendly vessels, including electric-powered or hybrid ships, to reduce greenhouse gas emissions. Additionally, 15 operating ships will be equipped with diesel particulate filters (DPF) to reduce fine dust emissions.

In the private sector, support will be provided for building 20 ships in keeping with the demand for transitioning to environment-friendly vessels. Financial assistance such as secondary financing will continue to be offered as well for 12 vessels for installing environment-friendly equipment.

Meanwhile, applications for the 2025 First Phase of the Certified Environment-Friendly Vessel Supply Support Project will be accepted from 31  January 31 to 27 March to support the construction of environment-friendly vessels by small and medium-sized coastal shipping companies operating in domestic ports.

Eligible applicants include coastal shipping companies that order certified environment-friendly vessels such as electric-powered or liquefied natural gas (LNG)-fuelled ships. Selected applicants can receive subsidies of up to 30% of the ship's construction cost depending on the certification grade and vessel construction expenses.

“We will make generous investments in small and medium-sized shipping companies to convert into environment-friendly ships, drastically reduce greenhouse gases in the shipping industry, and proactively respond to strengthening international decarbonization regulations,” Minister Kang Do-hyung said.

 

Photo credit: Lauren Seo on Unsplash
Published: 14 February, 2025

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