Zero carbon fuels must represent 5% of international shipping’s fuel mix by 2030 for the global fleet to achieve complete decarbonisation by 2050, according to new research.
The study for the Getting to Zero Coalition found that the adoption rate is feasible with hydrogen-based fuels, especially ammonia, likely to play a big role.
Meeting this 5% target would put shipping on course to reach other important milestones that will enable full decarbonisation by 2050, according to the report conducted jointly by maritime consultancy UMAS and the COP26 Climate Champions.
A 2019 study by UMAS had already assessed that for full mid-century decarbonisation, zero-emissions fuels would have to account for 27% of shipping’s energy mix by 2036 and for 93% of it by 2046.
Hitting this new 5% goal by 2030, which translates to almost 16m tonnes of heavy fuel oil equivalent, would accelerate the adoption of zero-carbon fuels to desired levels during the following years, according to the study’s models.
This mid-century decarbonisation target is different from the IMO’s target of reducing total greenhouse gas emissions by at least 50% by 2050 compared with 2008.
UMAS had reported that shipping would get to zero emissions in 2070 if it followed the IMO target’s trajectory.
“Though the Getting to Zero Coalition has not yet aligned on a target year for full decarbonisation, it is preferable to have a 2030 target that enables decarbonisation in line with the Paris Agreement,” the study said.
UMAS has also already estimated that for full shipping decarbonisation by 2050, around $1.4trn to $1.9trn in investments will be necessary between 2030 and 2050.
The latest study argues that even though the Getting to Zero Coalition has set its 2030 commitment for zero-emissions vessels, adding a quantifiable target like the 5% zero-carbon fuel adoption, would help it attain that goal more easily.
This target could give energy companies greater confidence that there will be demand for green fuels and it could mobilise cargo owners to pay a premium for zero-emission fuels based on their freight share, the study said.
Additionally, investors could better quantify the level of investment needed across the value chain to make it happen.
“Shipowners could plan investments in new builds and retrofits, and regulators could be called on to ensure a level playing field is in place to enable the transition,” the study added.
Specific segments, such as container shipping, ammonia and liquefied petroleum gas shipping, as well as voyages on particular international routes could spearhead this 5% fuel adoption rate.
Container shipping is a suitable candidate given the small amount of ports and trades that dominate the sector, while certain non-container routes, such as Chile–US and Japan–Australia, could also contribute due to “enabling conditions for first movers of zero-emission fuels”, according to the study.
“If ammonia is selected, ammonia and LPG tankers are well suited to be first movers, as storage, systems and crew are well adapted to this fuel. This is also true for ships used to transport other hydrogen-derived fuels,” the study said.
Apart from this 5% uptake from international shipping, domestic shipping could contribute another 2% to 3% share of zero-emissions fuel in shipping’s total energy mix.
With 32 countries accounting for 50% of domestic shipping, they can hit this 2030 target by running 30% of their combined fleet on zero-emissions sources, according to the study.
Much of this energy picture will depend on the ability to supply shipping with the zero-carbon fuels, especially those derived from hydrogen.
The new report noted that the Getting to Zero Coalition’s “zero-carbon energy sources” is intended to include fuels derived from zero-carbon electricity, biomass and the use of carbon capture and sequestration.
“The definition includes green hydrogen and its derivatives, such as ammonia and methanol, blue hydrogen and its derivatives, as well as sustainable biofuels,” it said.
But it excludes energy sources derived from carbon capture and utilisation based on the combustion of fossil fuels.
“In terms of scalability, the hydrogen-derived fuels have the biggest long-term potential for rapid scaling in the following decades and should be a significant part of the 2030 fuel mix,” the study said.
UMAS has estimated that the 5% zero-carbon fuel share in 2030 equates to around 0.64 exajoules, or 15.8m tonnes of heavy fuel oil equivalent. If ammonia ends up becoming the favoured zero-carbon fuel during the coming decade, UMAS found that these 0.64 exajoules for shipping would require roughly 60 gigawatt of green hydrogen electrolyser capacity.
“60 gigawatt of green hydrogen electrolyser capacity for shipping by 2030 is achievable when considering the large-scale ambitions announced by leading economies,” the study said.
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