Analysis

Wartsila: Bridging the gap between net zero and now – the current scrubber retrofit landscape

Su Len Quach explains the role of the scrubber retrofit market and its position in shipping’s journey to a decarbonised future in a recent insight article.

Published

2 years ago

March 8, 2023

Admin

Wartsila Corporation on Monday (6 March) published an insight article describing how exhaust gas abatement systems are valuable solutions that bridge the gap between environmental regulations now, and in the future.

Wärtsilä Exhaust Treatment’s Team Manager, Integration Engineering, Su Len Quach, explained the role of the scrubber retrofit market and its position in shipping’s journey to a decarbonised future.

The commercial case for retrofitting scrubbers

As the shipping industry rallies to remain compliant and profitable while the pressure to decarbonise ramps up, it is tempting to only think about new vessels. But given the finances, timeframes and technologies involved, the existing fleet will remain part of the conversation and cannot be left behind.

The challenge of how to invest in existing vessels in an uncertain future should not be understated. Depending on their operating pattern, layout and technical capabilities, some technologies will not be relevant. Not all vessels can be easily retrofitted for future fuels, for example, and low carbon options may only be speculatively available in the medium and long term on the routes they operate.

In this challenging and uncertain atmosphere, the industry should turn to solutions that it already understands – and that can create a platform for further development.

As a mature technology with a strong return on investment, scrubbers - with the possibility for a carbon capture and storage (CCS) module to be added - enable owners to futureproof their existing assets against the changes in the market and the evolutions we will all face ahead.

Looking at the short-term, owners who invested in scrubbers for IMO 2020 compliance are already enjoying a competitive advantage. Reports throughout 2022 showed that scrubber-fitted ships earned twice as much as those without, with scrubber CAPEX paid back within a few years.

The business case for retrofitting a scrubber today is positive. With the wide and relatively stable spread between high and low sulphur fuels, they continue to offer favourable economics and payback time has been less than two years for several vessel types.

In addition to their fast return on investment, scrubbers can in foreseeable future tackle CO2 with onboard capture and storage, making them a futureproofed investment for achieving marine decarbonisation goals.

All this should give the industry optimism that existing solutions can help support the latest regulations, including CII and EEXI, and prepare for carbon pricing further down the road towards 2030 and 2050.

For owners and operators, the key challenge in the more immediate term is finding an experienced partner that can deliver the right solution in good time, at any location, with reliable lifecycle services support.

Optimising the retrofit timeline

Scrubber installations are complex undertakings that require a knowledgeable, agile partner with vision across the entire value chain. Minimising off-hire time is critical. Wärtsilä can match design time with the production of equipment and optimise the timing and location on all retrofit phases from initial study to commissioning to minimise vessel downtime. One example is combining commissioning and installation activities to save total off-hire time.

A first 2D layout drawing provides owners with an understanding of the scope of the installation and enables onboard space to be reserved. A full technical feasibility study can then be undertaken before or after contract signing.

Owners typically make most decisions within the first four weeks after contract signing. This is when the equipment, piping and possible tanks are modelled, and owners may consider their preferences, such as tank locations, to ensure the design process is straightforward.

This phase also includes how best to futureproof the installation, for example, the possibilities of CCS-readiness or hybrid functionality. The work required to allow for a CCS add-on is mainly done on the drawings at this stage, but some modifications can be made to the scrubber body. Space will need to be reserved above the scrubber and the funnel may need raising a few metres, and in some cases, it makes sense to do this as early as possible.

In our experience, best practise is having the shipyard do the detailed design to ensure a smooth and fast process that avoids confusion during installation. Co-operation between the basic and detailed designer is important though, and a good scrubber manufacturer will act as a link between all parties. In some cases, it is personal relationships and prudent communication skills more than the contract that can ensure positive, timely outcomes.

Embracing proven technology that can bridge the gap between current and future environmental regulations will enable the industry to move forward optimistically in 2023. With advanced scrubber solutions and by choosing the right partners, owners can be confident they will achieve compliance and remain competitive when working with a partner that has the knowledge and experience in the retrofit segment.

With technical expertise to support clients in coordinating with equipment providers, yards, engineering companies and class, Wärtsilä’s scrubber retrofit solution ensures world-class engineering with minimal risk, and unlocks the potential for abating CO2 emissions in the future.

Photo credit and source: Wartsila Corporation
Published: 8 March, 2023

Research

Yamna identifies five potential global ammonia bunkering hubs

Unlike methanol, ammonia is not constrained by biogenic CO2 availability, and its production process is relatively simple.

Published

3 weeks ago

December 31, 2024

Admin

Specialised green hydrogen and derivatives platform Yamna in early December identified several potential ammonia bunkering hubs around the world.

The hubs are Port of Rotterdam, Port of Algeciras, Suez Canal, Jurong Port, and Port of Salalah.

“The shipping industry faces an ambitious challenge: reducing emissions by 20% by 2030 (compared to 2008 levels) and achieving net-zero emissions by 2050, in alignment with IMO targets,” it stated.

“Achieving these goals in the medium to long term depends on the adoption of alternative low-emission fuels like green ammonia and methanol.

“Among these, ammonia is attracting growing interest as a viable option. Unlike methanol, it is not constrained by biogenic CO2 availability, and its production process is relatively simple.”

However, the firm noted kickstarting ammonia bunkering on a large scale required four enablers to align:

Ammonia fuel supply
Application technology
Bunkering infrastructure
Safety guidelines and standards

It believed ammonia bunkering hubs will first emerge where affordable and scalable ammonia supply is available.

Yanma Why use ammonia for bunkering fuel

Photo credit: Yanma
Published: 31 December 2024

Research

Port of Long Beach releases Clean Marine Fuels White Paper

Document intended to prepare and position the port and its stakeholder for adopting low carbon alternative fuels.

Published

4 weeks ago

December 26, 2024

Admin

Clean Marine Fuels Port of Long Beach (December 2024)

The Port of Long Beach (PLB) in late December released the Clean Marine Fuels White Paper as part of efforts to identify solutions capable of reducing emissions from ships.

“To understand the opportunities and challenges related to the adoption of clean marine fuels, the Port of Long Beach hired ICF Consulting to develop this white paper as an educational resource and guidance document,” stated PLB

“This document is also intended to prepare and position the port and its stakeholder for adopting low carbon alternative fuels.

“The white paper provides high level information on the array of currently available low carbon marine fuels, along with an exploration of the potential infrastructure needs for their deployment.”

The document covers the use of different types of clean bunker fuels such as green hydrogen, green methanol, green ammonia, renewable LNG and biofuels for shipping.

“The shift to clean marine fuels is no longer optional but a necessity for the sustainability of the maritime industry,” stated PLB in its closing remarks.

“This transition, while presenting challenges such as high costs, limited fuel availability, and the need for extensive infrastructure development, is advancing due to evolving policy frameworks and growing industry commitment.

“Addressing these obstacles will require targeted initiatives and robust collaboration between public and private sectors. Continued policy support, government funding, and sustained industry commitment will be essential to driving this progress and ensuring the long-term sustainability of maritime operations.”

Editor’s note: The 123-page Clean Marine Fuels White Paper may be downloaded from the hyperlink here.

Photo credit: Clean Marine Fuels White Paper
Published: 26 December 2024

Port & Regulatory

Clyde & Co: FuelEU Maritime Series – Part 6: Legal issues

Bunker purchasers should consider the wording of their bunker supply contracts carefully and ensure that they are comfortable with the contractual provisions.

Published

4 weeks ago

December 26, 2024

Admin

Global law firm Clyde & Co on Thursday (19 December) released the final instalment of its six-part series uncovering the FuelEU Maritime Regulation.

In it, the firm looked at the legal issues that could potentially arise between various parties, such as owners, charterers, ship managers, bunker suppliers, and ship builders, as a result of the compliance requirements imposed by the Regulation.

The following is an excerpt from the original article available here:

Bunker supply contracts - legal issues

Both vessel owners and bunker purchasers will want to ensure that they are able to take advantage of the preferential treatment provided under the FuelEU Regulation for consuming renewable fuels, including biofuels and renewable fuels of non-biological origin (RFNBOs) (such as methanol and ammonia).

Article 10 of the FuelEU Regulation states that such fuels must be certified in accordance with the Renewable Energy Directive (RED) 2018/2001. If the fuel consumed by the vessel does not meet the applicable standards or have the appropriate certification, then it “shall be considered to have the same emissions factors as the least favourable fossil fuel pathway for that type of fuel”[1].

In order to confirm that the fuel complies with greenhouse gas (GHG) intensity and sustainability requirements, the vessel owner and bunker purchaser will want to ensure that the bunker supplier provides the appropriate certification required under the FuelEU Regulation. The EU has required certification of such fuels, with the aim of guaranteeing “the environmental integrity of the renewable and low-carbon fuels that are expected to be deployed in the maritime sector.”[2]

The FuelEU Regulation provides that the GHG intensity of fuel is to be assessed on a “well-to-wake” basis, with emissions calculated for the entire lifespan of the fuel, from raw material extraction to storage, bunkering and then use on board the vessel.

Vessel owners and bunker purchasers will, therefore, need to be mindful of the importance of establishing how “green” the fuel actually is, and of the risk of bunker suppliers providing alternative fuels that will not allow for preferential treatment under the FuelEU Regulation.

It would, therefore, be advisable for bunker purchasers to consider whether the wording of their bunkering supply contracts is sufficient to ensure that the fuel is properly certified under the FuelEU Regulation. This could include contractual provisions that require the supplier (i) to provide a bunker delivery note (BDN), setting out the relevant information regarding the supply (such as the well-to-wake emission factor), and (ii) to provide the necessary certification under a scheme recognised by the EU.

Bunker purchasers should also be mindful that bunkering supply contracts often contain short claims notification time bars and provisions restricting claims for consequential loss. Issues could therefore arise where a purchaser tries to advance a claim against the supplier for consequential loss due to a lack of certification, but the bunker supplier argues that such losses are excluded under the terms of the bunker supply contract.

Bunker purchasers should therefore consider the wording of their bunker supply contracts carefully and ensure that they are comfortable with the contractual provisions.

Photo credit: CHUTTERSNAP from Unsplash
Published: 26 December 2024