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SAFER, SMARTER, GREENER DNV GL © 2013 19 March 2015 Christos Chryssakis Future Fuels for Shipping 1 Pathways to 2050

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Page 1: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015 SAFER, SMARTER, GREENERDNV GL © 2013

19 March 2015

Christos Chryssakis

Future Fuels for Shipping

1

Pathways to 2050

Page 2: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Global Impact of Shipping

2

Shipping: 3% of global CO2 emissions 10-15% of global NOx

4-9% of global SOx

Page 3: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Our Global Challenge: Climate Change

3

Source: International New York Times, May 14th, 2014

Page 4: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Our Global Challenge: Climate Change

Shipping has to contribute

– Technical Measures

– Operational Measures

– Introduction of Alternative Fuels

4

Source: IPCC, 2013

Page 5: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Pressure to reduce GHG emissions to mitigate climate change

5

Potential additional IMO CO2 requirements

State-sponsored CO2 reduction agreements

Separate stakeholder requirements

Alternative fuels may be a necessary part of the solution to reduce CO2 emissions

Page 6: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Difficult Choices Ahead

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Page 7: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Increasingly strict regulations on emissions to air

7

A number of alternative fuels will ensure compliance with upcoming requirements

Page 8: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Drivers for Alternative Fuels in Shipping

Reducing Greenhouse Gas Emissions

New Regulations: Pollutant Emissions

Need for Low Sulfur Fuels

– In the ECAs (30-50 Mt/year today)

– Globally after 2020 (or 2025) ( 300 Mt/year)

Fuel Availability – Energy Security - Cost

8

Page 9: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Lessons from history: fuel shift

1892: Diesel engine patented

1903: First diesel powered vessels were

launched

1912: First ocean-going diesel powered

vessel launced: MS Selandia

1945: 60% of new ships are diesel powered

1960: Most new ships are diesel powered

2000: First LNG powered ferry: MF Glutra

2014: 50 LNG powered ship scheduled for

delivery

9

Page 10: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Alternative Fuels

for Low Carbon Shipping

10

Page 11: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

The Fuel Trilemma

Affordability

SafetySustainability

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Page 12: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

The following alternative options could be used in shipping

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LIQUIFIED NATURAL GAS

• A proven and available solution

SHIP ELECTRIFICATION AND RENEWABLES

• Efficient use of energy • Batteries enable use of renewable power

BIOFUELS

• Second and third-generation biofuels• Can be mixed with conventional fossil fuels

OTHER OPTIONS

• E.g. LPG, methanol, ethanol, hydrogen

Page 13: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Liquefied Natural Gas (LNG)

13

Gas Engines, Dual-

Fuel Engines

More than 50 ships

in operation

Main Issue:

Bunkering

infrastructure

Page 14: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

There are currently 139 confirmed LNG fuelled ship projects

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Updated 17.03.2015Excluding LNG carriers and inland waterway vessels

Page 15: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Ship Electrification and Renewables

15

Hybrid shipsPure electric

shipsCold ironing

Renewables for

power

production

Page 16: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Biofuels

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Three sources:

edible crops; non-

edible crops and algae

Production capacity

increasing

Main challenges:

Land area required

Long term storage

Page 17: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Other Gaseous or Liquid Fuel Options

17

LPG: Liquefied

Petroleum Gas Methanol

DME: Di-Methyl

Ether

Page 18: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Life Cycle Assessment of Fuels

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Well-to-Tank

RefineryPipeline to onshore refinery

Offshore gas/oil

production

Fuel tanker Receiving terminal

Distributionnetwork

Bunkering

Fuel usedfor propulsion

• Emissions to Air?• Environmental Footprint?

Tank-to-Propeller

Page 19: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Environmental Footprint of Alternative Fuels

Well-to-Propeller Greenhouse Gas Emissions

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Tank-to-Propeller (combustion) emissions assumed to be equal to CO2 absorbed by the plant during its lifetime

Page 20: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Availability of Alternative Fuels

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Fuel 2010 Total consumption (million TOE/year)

Oil-based 4,028*

Natural Gas 2,858 (LNG: 250-300)

Biodiesel 18-20

LPG 275

Methanol 23

Ethanol 58

DME 3-5

Fischer-Tropsch 15

Biogas Very low

Hydrogen Very low

* Approximately 7-8% for shipping

Page 21: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Future Scenarios – Medium Term 2015-2030

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Local – Short Sea Shipping

• Locally available fuel sources

• LNG in Norway, North America

• Methanol in Sweden

• Biodiesel from various feedstocks

• Electricity

Global – Deep Sea Shipping

• Different needs, more conservative

• Globally available fuels

• Oil-based fuels (Low Sulphur)

• LNG growing

Page 22: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Future Scenarios – Long Term 2030-2050

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Local – Short Sea Shipping

• Locally produced fuels established

• Biogas

• Biodiesel

• Biomethanol/ethanol

• Electricity

• Hydrogen?

Global – Deep Sea Shipping

• Globally available fuels

• LNG

• Biodiesel

• Nuclear?

• Others?

Page 23: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Possible Future Scenarios

23

2020 2030 2050

LNG bunkering infrastructure developing.

Hybrid ship increasing fast in short sea shipping/offshore shipping.

Testing of methanol, ethanol, DME, biodiesel and biogas

LNG penetrating the deep sea shipping segment

Cold Ironing/shore power

Hybrid and electric ships are common in short sea/offshore.

Pilot installations of fuel cells with hydrogen solutions in niche segments as supplementary propulsion power.

Biofuels and biogas part of the fuel mix for niche trades and regional use.

LNG could be the main fuel used in deep sea shipping

Hybrid and electric ships conventional, especially for short sea/offshore. Fuel cell with hydrogen fuel produced from renewables.

Unexpected events could lead to radical solutions, such as Carbon Capture or Nuclear propulsion

Biodiesel and biogas will have an important role

Page 24: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Getting ready for alternative fuels

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Page 25: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

A structured, step-wise approach

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Fuel decisionIs the alternative fuel technically feasible and a commercially attractive solution for the vessel?

1

Technology

qualificationWill the new technology function?2

Review of

concept and

initial design

Is the design ready for the alternative fuel and are all necessary regulatory requirements met?

3

Risk assessmentDoes the design adequately deal with the risks of implementing the alternative fuel?

4

Page 26: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Two options for making a vessel ready for an alternative fuel

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Vessel ready for operation today

Vessel ready for future retrofit

Page 27: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

Selandia – first diesel powered ocean going vessel - 1912

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Warning: Never mistake a clear view for a short distance (Paul Saffo, Stanford)

Page 28: Future Fuels for Shipping - Business Finland · PDF fileFuture Fuels for Shipping 1 Pathways to 2050. DNV GL © 2013 19 March 2015 ... –Introduction of Alternative Fuels 4 Source:

DNV GL © 2013 19 March 2015

SAFER, SMARTER, GREENER

www.dnvgl.com

Alternative Fuels for Shipping

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Contact information:

[email protected]

+47-91554678