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T&E: Biofuels and e-fuels in trucks will make it harder for aviation and shipping to go green

Including biofuels and e-fuels in road transport would reduce available volumes for hard-to-decarbonise sectors, while doing nothing to bring down e-fuel prices for aviation and shipping, says T&E.

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RESIZED Chris Pagan

Transport & Environment (T&E) on Tuesday (8 November) said biofuels and e-fuels in road transport would reduce available volumes for hard-to-decarbonise sectors, while doing nothing to bring down e-fuel prices for aviation and shipping. 

In a brief explainer, T&E said the EU climate targets will slash demand for oil and gas. As a result, fuel suppliers are investing in e-fuels and biofuels to replace them. 

“It is in their interest to maximise the number of sales markets for those fuels, despite hard-to-abate sectors such as aviation and shipping needing to prioritise fuels based on green hydrogen (and advanced biofuels in the case of aviation) for their own use,” it said. 

“However, as part of its market maximisation strategy, the fuels industry tries to convince aviation and shipping actors that they would benefit if road transport also used biofuels and e-fuels. They claim that ‘using e-fuels in trucks and buses will help scale up production, reduce their costs, and make them more available for planes and ships’. They also claim that ‘Road hauliers will bear most of the high cost, making e-kerosene almost free for airlines.’ This is incorrect, as this simple explainer will make clear.”

Currently, T&E said fuel suppliers are correctly incentivised to focus on aviation and shipping in the Renewable Energy Directive (REDIII) thanks to multipliers as well as an indicative RFNBO supply target for shipping.

The 1% transport sub-target for RFNBOs can be met by providing the required minimum supply of e-fuels

needed to meet sub-targets under ReFuelEU and FuelEU Maritime, without any need for additional e-fuels to be used in road transport. The aviation and shipping regulations provide the right regulatory incentives to prioritise truly advanced and sustainable biomass feedstocks for hard-to-abate sectors instead of using them to produce liquid and gaseous biofuels for road transport.

“However, opening the door to fuels in road transport could incentivise the exact opposite. If e-fuels

and biofuels are credited in the CO2 standards for heavy-duty vehicles (HDVs), fuel producers would have an incentive to only provide the minimum volume of e-fuels and biofuels to the aviation and shipping sector that is needed to fulfil regulatory sub-targets,” T&E said. 

“They would tool their refineries to the detriment of kerosene output and try to maximise the fuel volume going into road transport. The same logic applies to advanced biofuel feedstocks, where competing uses are already limiting access to sustainable sources, which should therefore be prioritised in non-electrifiable transport modes.”

“The adoption of this crediting system could jeopardise the aviation and shipping industries’ access to sustainable, affordable, and scalable renewable fuels and their chance to cut emissions and move towards climate neutrality.”

Note: The full briefing by T&E can be found here.

Photo credit: Chris Pagan on Unsplash
Published: 9 November, 2023

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Biofuel

VARO and Orim Energy to supply bio bunker fuels in ARA region

VARO will source, produce and blend various waste and advanced bio feedstocks to high quality bunker fuel specs; Orim will source fuel and gas oils for blending and deliver final biofuel blends to vessels.

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VARO and Orim Energy to supply bio bunker fuels in ARA region

VARO Energy (VARO) on Wednesday (21 February) said it is partnering with Orim Energy (Orim) to provide shipping customers in the Port of Rotterdam – and wider Amsterdam-Rotterdam-Antwerp (ARA) region - with biofuels. 

The agreement supports the decarbonisation of maritime transportation and inland shipping in Northern Europe. It also contributes to the wider targets set by the International Maritime Organization (IMO) to reduce the total annual GHG emissions from shipping by at least 20% by 2030 and at least 70% by 2050, compared with 2008 levels.

Current demand for Fuel Oil in ARA , Europe’s largest bunkering hub, is approximately 14 million tonnes per year. Supported by new EU regulations, the market for B30, a blend of 70% Fuel Oil and 30% biofuels, is expected to grow rapidly to the end of the decade. As a result of this joint initiative, VARO and Orim will be well positioned to meet this increased demand and support the decarbonisation plans of their shipping customers.

VARO’s biofuels trading capabilities and growing biofuel manufacturing asset base will complement Orim’s extensive distribution, storage and bunkering capabilities in ARA. Under the agreement, VARO will source, produce and blend various waste and advanced bio feedstocks to high quality bunker specifications. Orim will source the fuel and gas oils for blending and deliver the final biofuel blends to customers’ vessels.

VARO has a long track record of providing biofuels for maritime logistics. Since 2018, the company has supplied the Port of Rotterdam with HVO100 (100% Hydrotreated Vegetable Oil “HVO”) for use with the Port’s service fleet. In 2023 VARO signed an agreement with Höegh Autoliners to supply the company with 100% advanced biofuels for its shipping fleet.

The partnership is aligned with VARO’s strategy to become the partner of choice for customers in the energy transition by providing them with the low-carbon energy solutions they need to decarbonise.

Dev Sanyal, CEO of VARO, said: “Meeting rising demand for blended biofuels is critical to achieving the EU and IMO’s decarbonisation targets for shipping. Our experience in biofuels, combined with Orim’s logistics and bunkering operations, will help meet this demand at Rotterdam, Europe’s largest port facility. I am delighted to be entering into a strategic partnership with Orim and to further build on VARO’s long-established presence in Rotterdam. This is another step in our journey to enable the decarbonisation of the maritime sector.

Edwin Coppens, Managing Director of Orim, said: “Upcoming EU and IMO regulations drive the need to scale up with biofuels and ensure quality assurance going forward. Partnering with VARO allows us to do just that, using each other’s strengths to optimize our blending expertise and network. We will benefit from VARO’s extensive experience with biofuels, which includes joint testing with leading ship engine suppliers. Together, we can increase our sourcing and supply capabilities, extending our reach and further strengthening our position in the ARA region.”

 

Photo credit: VARO Energy
Published: 23 February, 2024

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Singapore: Vitol Bunkers takes delivery of specialised biofuel bunker barge “Marine Future”

New vessel will uniquely make it possible to supply biofuel blends including B24, B30 and up to B100; can also be re-configured in future to supply methanol bunker fuel.

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Singapore: Vitol Bunkers takes delivery of specialised biofuel bunker barge “Marine Future”

Singapore-based marine fuel supplier Vitol Bunkers on Thursday (22 February) said it has taken delivery of the Marine Future, its first specialised bunker barge in Singapore, strengthening its position in Asia’s expanding biofuel bunker market.

The addition of this specialised IMO type 2 notation bunker tanker to the V-Bunkers fleet will uniquely make it possible to supply biofuel blends including B24, B30 and up to B100, depending on customer specifications.

Built in China, Marine Future is 102.6m in length and has the capacity to carry about 7,000 MT of biofuels.

“The current fleet of bunker tankers in Singapore are classified as ‘oil tankers’ and are therefore restricted to a maximum of 25% bio component in biofuel blends. This new bunker tanker has no such restriction, hence can deliver bunker fuels consisting of 100% bio component (B100),” the firm said in a statement.

“Biofuels are a key pathway for the hard-to-abate shipping sector to mitigate emissions. Biofuel sales in Singapore reached 520,000 tonnes in 2023 according to the Maritime and Port Authority of Singapore (MPA), representing a material increase on the prior year where volumes were 140,000 tonnes.”

“We are delighted to now be able to offer our maritime customers the option to take up to 100% bio component bunker fuel here in Singapore and play our part in advancing the port’s decarbonisation efforts. Should there be demand, this vessel can also be re-configured in future to supply methanol” said Mike Muller, head of Vitol Asia.

Related: Vitol targets Singapore for Asia biofuel growth with bunker barges arrival in 2024
Related: Vitol chooses ZeroNorth e-BDN solution in Singapore

 

Photo credit: Vitol
Published: 22 February, 2024

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Biofuel

PRIO delivers its first bunker fuel supply of B20 in Aveiro Port, Portugal

Firm supplied 50 tonnes of B20, an advanced biofuel blend that combines 20% renewable energy with high-quality marine diesel, to Schulte & Bruns Nederland’s cargo ship “FWN SUN”.

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PRIO delivers its first bunker fuel supply of B20 in Aveiro Port, Portugal

PRIO, a producer of biofuels from residual raw materials in Europe, on Friday (16 February) said it delivered the first supply of ECO Bunkers B20 via a truck-to-ship operation in Aveiro Port. 

The firm supplied 50 tonnes of B20 to Schulte & Bruns Nederland BV's cargo ship FWN SUN resulting in a reduction of 40 tonnes of CO2 and a reduction of up to 87.8% in greenhouse gases, compared to traditional fossil fuels.

“This initiative not only promotes more sustainable shipping, but also demonstrates the joint commitment to sustainability,” the firm said in a social media post. 

Telmo Ferreira, who is responsible for PRIO's Emerging Business and Shipping, highlighted that the increase in demand for quality and environmentally friendly marine fuels motivated the company to develop ECO Bunkers.

According to the firm, ECO Bunkers is an advanced biofuel blend that combines 20% renewable energy with high-quality marine diesel, offering a sustainable solution to the needs of the sector.

 

Photo credit: PRIO
Published: 19 February, 2024

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