Shifting sands in Europe

The package is expected to have much broader implications for the European shipping sector, given its ambitious goals of increasing the 2030 target to 50% from its current 40%, modifications to the scope of the ETS, and plans to restrict tax exemptions for maritime fuels.

While the development of low-emission alternative fuels is likely to be stimulated by the decision if implemented, it is unlikely that any alternative fuels could be introduced and scaled up to meet demand by 2030. The proposal by eight major associations to introduce a US$2/t levy on marine fuel to fund an R&D pot represents an important contribution to the decarbonisation debate.

It was a measure of how fast the alternative fuels debate has progressed that feasibility and economic viability issues connected with alternative fuels attracted significant discussion during The Motorship’s Propulsion and Future Fuels conference held in Hamburg in November. Norway’s decision to fund the development of a hydrogen distribution network is one such development.

Realistically, LNG appears likely to remain the most favoured low-emission fuel and was set to increase in importance over the near term. It is unlikely that alternative fuels would emerge in commercially viable volumes in time to meet the fuel demands of vessels operating in 2030 given the lead time and costs involved, while cost considerations are likely to continue to favour hydrocarbon-based hydrogen “vectors” (or energy carriers) over green wind or solar derived fuels in the near to medium term. Such schemes would need to be combined with carbon capture schemes in order to ensure their carbon neutrality.

This suggests a new area for shipping could be the development of viable carbon capture, use and storage schemes. The amendment to the London Protocol in autumn to allow international shipments of carbon dioxide (CO2) represented an important step in removing regulatory obstacles. We explored the detailed work undertaken by DNV GL in approving the containment system for a liquid CO2 carrier for the Equinor-led Northern Lights CCS project in an article published in December.

Finally, 2020 promises to be a memorable year for The Motorship, as we mark the centenary of our first issue with a series of monthly special features, covering landmark projects, companies and developments that have accompanied our publication over the last few years.

We begin our coverage with a series of articles covering the dry bulk sector, covering the evolution of bulker design, as well as the development of rules to cover liquefaction, which remains a closely monitored challenge for the segment.

We wish all our readers a happy and prosperous New Year.