The maritime industry facing a fundamental shift and shaping the future of sustainable energies

The Head of Green Ship of the Future, Frederik Schur Riis joined us to share his views on the decarbonization of the industry. Green Ship of the Future was established in 2008 and gathers 60 members. The members are from all the shipping industry going from ship owners to suppliers of mechanics to the industry. They work together towards a future where shipping relies on sustainable energy:

We are working towards a future where the shipping and maritime industry is completely sustainable and emission free.

Today’s main topic is decarbonization, but this is not the only issue the industry is currently facing in terms of sustainability. Green Ship of the Future works on all aspects with its members, including production and operations. The goal for them is to collaborate with everybody to generate innovation, by looking at an issue from different perspectives and solving it in the best and financially sustainable way. The shipping and the maritime industry have been a driver of growth and globalization. 90% of all trade is transported by water, from commodities to cars, including people as well. While being the most environmental mean of transportation, it still has a lot of issues as it accounts for 3% of carbon emissions in the world for a sector that does not produce anything.

*Maersk Line is comprised of 660 owned and chartered container vessels

Reducing Greenhouse Gas: towards neutrality and sustainable energy

Now states and the European Union, are starting to move towards a greener system, with a goal from the International Maritime Organization of reducing the total annual greenhouse gas emissions by at least 50% by 2050 (compared to 2008). MAERSK is even more ambitious with the goal of going towards sustainable energy. They made the commitment of being “net-zero CO2 emissions by 2050”. This means we need to act fast.

Regarding “green” shipping, there are many factors to look at:

  • Sustainable production: producing the vessels
  • Sustainable operation: fuel, everything operating the ship
  • Sustainable on shore operation: loading cargo, containers, all the liquids…
  • Optimal utilization: same issue with car. Sharing vehicles e.g. issue with Uber, bring the utilization up.

When you place this on a spectrum of innovation, you have the degree of novelty over time. To innovate, Green Ship of the Future is looking at the retrofit series, ECO feeders, 3D printing, all the tools of digitalization, circular economy and of course future fuels.

Energy as the problem and solution

The largest climate sinner is the energy vectors. First, we had sail, then steam vessels which were great but horrible for the climate. Now we are relying on some sources that are fossil-based and that are not sustainable. If we continue to use energy in the quantities we do, the climate will simply not regulate itself. The need is for the energy vectors  to go back to their renewable origins. There are different issues for each.

Solar energy, wind power and hydropower are the most in use, but they all fluctuate. Then there are other forms of “sustainable” energy such as nuclear but they face other issues and it’s not that promising right now. Biomass is another option, but we don’t have enough data at the moment of how much we have and if it can be really sustainable, so we might come back to it later. If we look at Denmark, on some days they can produce more than a 100% of their energy through windmills, but on average it’s only about 50%. We need to find a way to stabilize this.

Renewable energy can be produced at the place of consumption, with sails or solar cells, which are good contributors but not totally reliable. There are nuclear powered vessels but this is mostly for the military. But some fuels can be centrally produced, stored and transported for consumption such as batteries.

A new sustainable & storable energy

There is a new idea, which is called E-fuels. It is being considered by the maritime industry and the rest of society since it can be stored. It is either power-to-gas or power-to-liquid. Through electrolysis, it separates water into Hydrogen and Oxygen where hydrogen is an energy carrier. It is hard to store, but it is changing the way society uses energy. Hydrogen could be a new oil but we need hydrogen carriers. It could be combined with carbon, or nitrogen.

The issue is that, even though we find sustainable sources of energy like green carbon, they all have their problems. Is there enough green carbon? How do we make sure that we don’t destroy a forest, that we don’t take out land? And obviously, we are not the only ones thinking about this. The airline industry will also need green carbon. Plastic factories as well, and so will the chemical industry and many more.

Vector of the future

Energy production as well as the related infrastructure and trade fall under a spectrum of innovation that is very radical.

“It will disrupt the entire industry around energy. We have built our society around oil and around fossil energies. So a change away from that towards hydrogen or other sustainable energy vectors is an amazing opportunity, for the maritime industry but also for society in general. There will be a lot of value created.”

The problems to be solved are first, achieving better energy efficiency for the shipping vessels, then reaching an optimal level of utilizing the ships by digitization with IoT and Machine learning. The goal is to scale up electrolysis, battery energy storage capacity, fuel cell technology and carbon capture and storage. Finally, we need increased transparency and a classification of sustainable biomass.

Q&A

We talked about these goals to achieve carbon neutrality and sustainable energy by 2050. What about this timing? 2020 to 2050, are there concrete actions already taking place?

There are a lot of concrete actions, there are a lot of partnerships taking place within the industry. We’re seeing the “Getting to zero” coalition, with a lot of energy producers and ship owners, coming together with the goal of getting the first carbon-neutral vessel in the waters by 2030. And then there are the Poseidon Principles. It is a partnership of loan givers and capital providers for the maritime industry, that have come together to set standards. It’s 20% of the entire loan book for shipping, coming together to say how companies should be efficient and communicate for them to get access to financing.

You mentioned that a vessel can last for 28 years and in 2 years we must already have some solutions. When you mention solutions, are you talking about the early incremental innovation?

Within the next couple years we need to have the first testing ships on the water. We are already seeing ships that are able to use some of the matters that are close in characteristics to what we need to achieve. It’s going to be a transition, acting retroactively as well.

Are you aware of any trials with multi energy sources? And harvesting energy while at sea?

They are looking a lot into that. There are a lot of interesting solutions. For instance, in terms of wind harvesting, there are different concepts. Some have installed a roller on top so that no matter in what direction the wind blows, you can use the energy created to propel the vessel. Some other are trying to put sails on the side of the vessel, or some with the same principle of kite surfing. And once you have installed this, it is basically free.

You also mentioned the on-shore operations, does the goal for 2050 also takes it into account?

From the IMO perspective, they haven’t put any guidelines. But given the fact that they say GHG emissions, yes. But the operations are by far the largest contributor so it has to be addressed.

You said that there is a lot of room for optimization of the resources in shipping. Is it possible to imagine an application, where myself as a consumer I could order which boat and route I could take?

There are already some startups, targeting at least small companies, where they can have all the information including the carbon emission. Creating that transparency is definitely something that is needed. It’s the first step before the consumer starts pushing the market. Companies such as IKEA, H&M are starting to push the transportation into becoming more sustainable, and actually clarifying how much they emit. I think that’s a tendency we’ll see more and more and this will be the opportunity for other companies to come out.

“This will be the opportunity to create transparency in this value chain. I believe that a lot of people, if given the choice, will make the best one for the planet and the environment.”

Are you aware of any specific funds in Europe supporting startups in the maritime sector or circular economy, maritime oriented?

First it depends on the location in Europe. But there are indeed, in the large projects such as Horizon 2020 a lot of circularity, in the maritime or production. Also, a lot of countries have their own innovation activities. We have been collaborating with the Danish maritime foundation, which is a private foundation, and there must be others looking into this. Good advice is to not only look at public funding but to strongly consider impact investors.

From your presentation, Hydrogen seems to be the right way to go. Are there any competing solutions?

The industry is very diversified. Within shipping, we have everything, from the smallest vessels coming from a small harbour to the largest at 400 meters long. Different boats have different needs. Batteries, fuel cells can work with small ones for instance. But the large vessels that take an extreme amount of energy and don’t go to port that often would require something such as one of the hydrogen carriers, like methanol, ethanol, would be preferable. The real question right now is to find a sustainable energy vector for large vessels.

 

About the speaker

Frederik Schur Riis is Head of Green Ship of the Future (GSF) – a non-profit collaboration of more than 50 leading organizations from the maritime industry. The aim of GSF is to facilitate collaboration and innovation, and work towards a sustainable impact free maritime industry. Frederik has a background in entrepreneurship and impact investing, and has founded, consulted and invested in companies from various industries, all with the common denominator of being for profit, while aiming to solve one or more of the UN Sustainable Development Goals.