Exploring developments in alternative fuels and wind power in the maritime industry

The maritime industry is on a journey towards a more sustainable future, with a focus that goes beyond reducing emissions to transitioning to cleaner fuels. This article explores key developments in alternative power sources, including wind propulsion, alternative fuels, and regulatory changes. These elements collectively shape the industry’s path to decarbonization.

Wind Propulsion

Wind assisted propulsion has great potential to progress shipping towards a net zero future. For one thing, wind propulsion is fuel-type agnostic, meaning that it works regardless of the primary means of propulsion. This makes it a compelling long-term candidate for ship decarbonisation because it can offer additional efficiency gains even when applied to a clean-fuelled vessel. Modern digital technologies mean that kites, sails, and rotors don’t require specially trained crew or sailing seamanship skills to operate them like those needed on traditional sailing ships, and many systems are self-governing during operation.

Wind propulsion company Airseas adapted a technology used in the aviation industry to apply it to shipping. The company achieved proof of concept for its Seawing kite sail technology in 2017 and has been working with Airbus and K-Line on the commercial development since then. By combining a 1000 sqm kite sail with tailored digital twin and route optimisation technology, the company hopes to reduce emissions and fuel consumption by an average of 20%.

Future Fuels

There is no doubt that alternative fuels which are sustainably sourced will ultimately be needed to replace fossil-based conventional fuels where possible. A recent Thetius study showed that around 79% of reported decarbonisation activity over a 12 month period commencing 1st March 2022, was associated with alternative power sourcing. 

The Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping has reported that only 35% of ship owners have clearly expressed their commitment to International Maritime Organization (IMO) targets. However, the figure varies by ship type, with container shipping leading the way with 53% of containership owners (representing 69% of the global container fleet capacity by deadweight tonnage) setting emissions reduction targets. 

These figures suggest that most of the forward momentum in fuel development is driven by larger fleets, biassed towards the containerised and manufactured goods sectors. Further evidence for this can be found among recent contracts for alternatively-fuelled new builds. Speaking to Seatrade Maritime earlier this year, Maritime Strategies International (MSI) Managing Director, Adam Kent, observed this trend when looking at orders for future-fuel ready ships. He said, “The pattern of orders we have seen over the last couple of years has either been for ships transporting manufactured goods such as containerships or car carriers, or vessels that can use cargo onboard for bunkers such as LNG and LPG. For containerships and car carriers, we see pressure from consumers to take action.”

This fragmentation may well continue to develop a global fleet which is segmented based on regional fuel options. Speaking on a Lloyd’s Register webinar on energy transition strategies in February 2023, LR Consultancy Director, James Frew, said, “I think where we see more of a significant challenge for alternative fuels is in globally trading vessels such as MR tankers, handysize, handymax bulkers and other smaller vessels with a strong global footprint. We believe that these fleets will trade more selectively as a result, so you may see alternatively fuelled vessels trading on specific routes, rather than trading globally.”

In March 2023, the EU announced the world’s first law on green ship fuels, FuelEU Maritime, an instrument which will apply clearer targets to shipowners and cut GHG intensity from shipping by 80% by 2050. A core commitment is at least 2% of European Union ship fuel supplied will need to come from renewable sources and processes by 2034.  In addition, a carbon intensity reduction mechanism is now set in motion, stipulating a reduction in GHG intensity from onboard energy demands of 2% by 2025, 6% by 2030, 14.5% by 2035, 31% by 2040, 62% from 2045, and 80% from 2050.

The legislation will apply to all passenger and cargo vessels of 5,000 gt or greater arriving or departing from EU ports, regardless of dominion of ownership or flag state.

The announcement follows a decision made in December 2022 to include shipping in the EU Emissions Trading Scheme. This is the EU’s cap-and-trade system for carbon crediting. Businesses which operate in the EU are allocated credits which they can use or sell if not all of the credits are required. The EU ETS has been in operation since 2005, but shipping had been omitted until new legislation was drafted by the EU in July 2021. Under a revision of the EU ‘green deal’, the shipping industry is being phased into the ETS incrementally between 2023 and 2026. 

Exactly which future fuels will dominate merchant shipping is yet to be fully determined, but it is most likely that a multi-fuel scenario will develop. Most candidates for sustainable clean fuels serve certain ship types better than others and there are regional variations in the viability of manufacturing, transport, and storage infrastructure which lend themselves to some fuels better than others. Speaking on the subject during Singapore Maritime Week 2023, Chief Operating Officer of Vallianz Holdings, Elisa Woodward, said, “As a ship owner, of course it would be nice to have one fuel for all of our ships, but it’s not going to happen. It will be a portfolio of fuels and that will be the way it is. For this reason, we also struggle to say what is best for us, because it also depends on where the vessel is going, what the vessel is doing, and where the routes and the availability in each country and region all come together.”

Joining Woodward on the same panel, Sarah Greenough, Head of Sustainability at BHP added, “I agree. For example, the Pilbara region of Western Australia is very important to BHP and we’re starting to see a lot of investment in the Asia renewable energy hub. This informs part of our decarbonisation strategy because green ammonia becomes much more attractive in that region and for our vessels going in and out of Port Hedland as a result of that investment. But I could understand that methanol might make more sense for container liners going to different trade lanes and different ports. It’s going to come down to where your trade lanes are, the types of vessels you’re using, their size, and where the renewable fuel is being produced.”

In April 2022, the Renewable and Low-Carbon Fuels Value Chain Industrial Alliance (RLCF Alliance) was launched by the EU Commission. This body plays a pivotal role in setting the pace and direction for producing and supplying renewable and low-carbon fuels in the aviation and maritime sectors. The RLCF Alliance is described as a “key flanking measure” that will operate alongside FuelEU Maritime to bring collaborators from across the transport fuels supply chain together. While it is too early to predict outcome measures from the alliance, it is convened by a range of interests including hydrogen, ammonia, methanol, and bio methane. Most forecasts on clean fuels generally indicate that these fuels are among the most likely candidates, with significant support from wind energy, solar energy, and lithium battery power. 

Supporting this view, the United States Government released the U.S. Department of Energy (DOE) ‘National Blueprint for Transportation Decarbonization’ in January, which brings clarity on the direction of travel for US-based ship fuels. The plan focuses on research and development, as well as state incentives for the adoption of alternative fuels and next generation propulsion systems. Ammonia, hydrogen, and methanol are the priority fuels according to the Biden administration.

As the maritime sector strives for sustainability, various factors come into play, from wind-assisted propulsion to the adoption of alternative fuels and evolving regulations. These aspects are pivotal in steering the industry towards a greener future. With ongoing efforts and collaborations, the maritime sector is poised to make significant strides in reducing its environmental footprint and embracing a more sustainable and responsible approach to shipping.

This article is an extract from the Thetius Decarbonisation Toolkit, commissioned by Inmarsat. To read the full 35+ page report, fill in the form below.