Zero-Emission Vessels: Transition Pathways
Zero-Emission Vessels: Transition Pathways identifies three potential transition pathways for the decarbonisation of shipping. The report includes three key primary energy sources that would allow zero-carbon fuels to enter the shipping fuel market: renewable energy, bio-energy and fossil fuels with carbon capture and storage (CCS).
The International Maritime Organization (IMO) aims to reduce the total annual GHG emissions from shipping by at least 50 percent by 2050 compared to 2008. In order to achieve this, zero-emission vessels must enter the world´s fleet in 2030. The report states that the three identified pathways will achieve the IMO’s ambition, and they will all lead to a mix of fuels but with different dominant fuels. In all pathways, fossil fuel-based marine fuels will completely phase out or will only account for less than 10 percent of the total fuel mix in 2050.
Pathway 1: Renewables
In this scenario, there will be a rapid increase in renewable electricity based marine fuels in the form of hydrogen, ammonia, e-methanol, e-gas oil and electricity for use in batteries. Bio-based fuels and hydrogen and ammonia produced from natural gas with CCS will also enter the fuel mix, but will account for a smaller share of the energy mix. This pathway relies on the access to cheap renewable electricity and a significant reduction in capex for relevant technologies.
Pathway 2: Bio-energy
Bioenergy will dominate the fuel mix. Electro-fuels and hydrogen and ammonia produced from natural gas with CCS will also be part of the fuel mix, but to a lesser extent. However, biofuels prices are very uncertain. The key to success for this pathway is therefore a reduction in price for bio-based fuels. Furthermore, bio-energy is expected to be used in other sectors like aviation, and in this case shipping would have to compete or find synergies with these sector to ensure sufficient access.
Pathway 3: Equal mix
In this pathway, there will be no dominant fuel. The report assumes there will be a a ramp-up of renewable electricity-based marine fuels and bio-based fuels. Hydrogen and ammonia produced from natural gas with CCS will gradually enter the fuel mix. This will require a consistent growth in the capacity of all energy sources.
International regulations, financial incentives and close cooperation between all stakeholders will be necessary to achieve zero emissions in shipping. Increased taxes on fossil-based fuels may also be necessary in order for alternative fuels to become competitive. In addition, a clear signal needs to be given to the potential fuel producers in order to ensure sufficient access to alternative fuels.
The report is a collaboration between Lloyd’s Register (LR) and University Maritime Advisory Services.