Environmental

How infrastructure will lay the foundations for alternative fuels

Apr. 7 2021

The shipping industry is looking with increasing urgency to make the switch from fossil fuels to carbon-neutral and zero-carbon fuels. To complete this crucial transition, ship owners, operators, managers and charterers will need a well-developed, worldwide network of port and bunkering infrastructure. Just as the development of liquefied natural gas (LNG) began by expanding on existing terminals, preparing alternative fuels for global distribution will start with infrastructure.

To meet growing demand, marine stakeholders, governments and technology providers will need to scale up storage, bunkering and fuel transfer infrastructure quickly across major shipping routes. This will require targeted, long-term investment in port infrastructure and bunkering vessels across North America, Europe, Southeast and East Asia, and the Middle East.

The three key elements of infrastructure

When assessing the readiness of infrastructure, there are three major areas that concern marine stakeholders: storage facilities, bunkering vessels and transfer systems.

Storage facilities are located at port, and must comply with port authority standards for safety for storing potentially dangerous substances (e.g., ammonia). Bunkering vessels are large or small-scale intermediary fuel carriers, which bring fuel housed in storage facilities to ships burning alternative fuels. Fuel is then transferred to ships via transfer systems – usually either full rigid arms or flexible hoses – that are integrated onboard bunkering vessels.

How developed is the infrastructure for alternative fuels?

  • Certain biofuels can use the same infrastructure and transfer systems as LNG, and most ports have accessible waste facilities. From the North Sea to the Black Sea[1], ports can safely provide biofuels
  • Methanol and ethanol have little port infrastructure and no bunkering vessels. Fuel is transported and supplied to methanol- and ethanol-powered ships by trucks.
  • Hydrogen production and storage facilities are being developed, but face significant technical and safety concerns. Solutions providers are working on improving storage technology, and there is one hydrogen bunkering vessel prototype currently being tested[2].
  • Ammonia is already regularly transported as cargo, so transfer systems for ammonia are well developed. Some storage facilities exist in ports, but there are still no ammonia bunkering vessels.

The challenges of scaling up infrastructure

First and foremost, major investment is needed to outfit the world’s ports – from China to Denmark to Canada – with the necessary infrastructure for a range of alternative fuels. According to the Getting to Zero Coalition[3], decarbonizing the shipping industry by 2050 will require a total investment of $1.4-1.9 trillion. A stunning 87% of that investment would be earmarked for onshore infrastructure and production facilities, with a majority reserved for hydrogen production and ammonia synthesis, storage and bunkering.

The question facing the marine industry is who will provide this impressive sum. Governments may be expected to underwrite these developments, providing public funds for infrastructure and incentives (e.g., tax breaks, carbon credits) to ship owners using alternative fuels. Some funding may come from marine stakeholders and energy providers[4] eager to accelerate the energy transition and comply with increasing environmental regulations. But there is no obvious answer that will make funding infrastructure simple or uniform for countries worldwide.

Improving port infrastructure is also a time-intensive process that requires strong collaboration and organization among stakeholders. Ship owners must first request at port delivery from alternative fuel providers, who in turn require authorization from the local port authority to build facilities and provide fuel. The port authority must assess the relevant infrastructure for compliance with safety, technical and environmental regulations before issuing a license to operate. Surveyors will then perform regular audits on the facilities to ensure ongoing compliance.

Additionally, certain key technologies are still under development and will not be commercially viable for years to come. Hydrogen storage[5] remains a technical and safety challenge, limiting its useability in onshore facilities and onboard bunkering vessels. Certain fuels, including ammonia and hydrogen, will need to be produced or burned with carbon capture and storage technology. Marine stakeholders will also need to account for roadblocks in the production process, as fuel providers seek technological solutions for providing end-to-end green energy.  
 

Martial Claudepierre
Martial
Claudepierre

Sustainable Shipping Global Technology Leader

Bureau Veritas M&O

The development of infrastructure to support alternative fuel distribution is an indispensable next step for the shipping industry. While this advancement may happen more slowly than for LNG – where onshore terminals already existed – ship owners and operators, shipyards, equipment manufacturers and solutions providers have a strong pool of expertise to draw on. This will give the marine industry a key advantage moving forward.

Applying hard-earned expertise to future fuels

Building the infrastructure to support the shipping industry’s transition to carbon-neutral and zero-carbon fuels will take time, as governments, international bodies and marine stakeholders make key decisions. Nonetheless, the shipping industry has an advantage, having already developed extensive LNG infrastructure in under 20 years.

Marine experts like Bureau Veritas are bringing the same technical, safety and regulatory knowledge gained from LNG development to other alternative fuels, in an effort to decarbonize shipping for the long-term. This combination of innovation, expertise and practicality will lay the groundwork for large-scale infrastructure development, itself the foundation stone for the next-phase energy transition.

[1] https://www.etipbioenergy.eu/images/ETIP-B-SABS2_WG2_Current_Status_of_Adv_Biofuels_Demonstrations_in_Europe_Mar2020_final.pdf
[2] https://www.wilhelmsen.com/media-news-and-events/press-releases/2019/new-design-makes-liquefied-hydrogen-bunker-vessels-a-reality/

[3] https://www.globalmaritimeforum.org/content/2020/01/Getting-to-Zero-Coalition_Insight-brief_Scale-of-investment.pdf
[4] https://www.total.com/media/news/communiques/coalition-for-the-energy-of-the-future-11-major-international-companies-join
[5] https://www.energy.gov/eere/fuelcells/hydrogen-storage-challenges