There's no need to delay the transition to a lower carbon shipping industry

The journey of a thousand miles begins with the step of adopting Methanol as a safe, future proof marine fuel, writes Kai Zhao, Methanol Institute Chief China Representative.

The global shipping industry has a dilemma – it needs to make long term choices about new fuels, many of which are not available yet. Policy is moving towards net carbon neutrality but industry initiatives are moving faster than international regulation.

With large shipbuilding and shipowning sectors to decarbonise, the impact on China is no different. These key industries do not have the luxury of waiting for as yet unavailable fuel technologies to reach regulatory approval and mature availability.

Short and Long Term Choice

Methanol is the logical short and long term choice for China's shipyards and shipowners. By using Methanol, shipowners have the opportunity to use the cleanest fuel available now, in existing vessels and newbuildings. 

As more renewable Methanol is produced, owners can progressively blend in blue and green product and ultimately switch to net carbon neutral fuel. 

Methanol is already regulated for use by the IMO and has been accepted by class societies – including China Classification Society - flag and port states as well as by vessel operators and charterers as a safe, compliant and efficient marine fuel. 

Methanol has 3-5 critical years of head start of experience-building and applicability as an alternative fuel, enabling vessel operators to move forward with emissions reduction in a phased way at low cost to Opex and Capex. 

Immediate Benefits

The use of Ammonia – and even Hydrogen - as marine fuels will come, pilots have already been initiated both in China and in other places of world, but only limited to short ranges or light duty vessels. It could require years of development in conventional form because of technology challenges, lack of regulation, infrastructure or pricing.

Methanol offers immediate benefits to reducing local pollution for the industry and society; no emissions of sulphur, minimal particulate matter, no black carbon. NOx emissions can be dramatically reduced by blending with water, saving substantial investment and further reducing health risks. 

Conventional Methanol offers ‘in-service’ GHG emissions reductions of +/-10% compared to fuel oil, supporting the drive towards IMO's 2030 carbon reduction targets. As more carbon capture, e-methanol and bio-methanol becomes available, we will see more “net GHG neutral” Methanol coming to market. 

Methanol is a low carbon and ultimately a net carbon neutral fuel. Production from Flue Gas (blue Methanol) can reuse existing carbon dioxide, while conversion from renewable electricity and CO2 (e-methanol) and processing of biomass and biogas (bio-methanol) is already producing certified and available renewable (green) Methanol.  

Industry Recognition

Methanol is already enjoying strong recognition from shipowners, classification societies and OEMs as a fuel that can reduce pollution and carbon emissions from ships and provide a pathway towards sustainability.  

The rising interest reflects the readiness of the fuel, with regulation in place, vessel designs established and engines available. It also demonstrates the desire of owners to act now on lowering emissions; many accept the need to make a start on this process rather than wait for longer term options to become available. 

The world's biggest shipowner COSCO together with Dalian Shipbuilding has developed a design for a Methanol-powered dual fuel VLCC believed to be the first ship of its type to receive class Approval In Principle.

Another of the world's largest independent tonnage providers of containerships, Danaos Corporation has announced an order for up to six 7,000 TEU containerships which will be ready to use Methanol as fuel. November 2021 saw joint venture Proman Stena Bulk launch Stena Pro Patria, the first of four 49,900 dwt methanol dual-fuel MR tankers that Proman and Stena Bulk are building together at Guangzhou Shipyard International. 

The industry is also keenly watching the development of a fleet of 12 Methanol-dual fuel container ships, which were ordered by Maersk Line in August 2021.

China Supply Chain

To boost the global production capacity of green methanol, Maersk has entered strategic partnerships with six leading companies with the intent of sourcing at least 730,000 tonnes/year by end of 2025. These include agreements with China's Green Technology Bank and engineering services company CIMC Enric.  

CIMC Enric, which has been a partner of Maersk for more than two decades will develop bio-methanol projects for Maersk in China. The phase one project will have a capacity to produce 50,000 tonnes/year of green methanol, starting in 2024. The second phase of the project will have a capacity produce of 200,000 tonnes/year with start date to be determined.

Green Technology Bank was established in 2016 by the Chinese government with the task to fulfil the 2030 Agenda for Sustainable Development. It will facilitate development of bio-methanol projects in China, the first of which is planned to have a capacity to produce 50,000 tonnes/year starting from 2024. The second project is planned to have a capacity to produce 300,000 tonnes/year at a start date to be determined.

No need to delay

Decarbonisation is a huge challenge for the maritime industry and one of its biggest challenges is knowing how and when to start. Methanol addresses these questions head-on because it is possible to adopt it as a fuel now and stay with it in future.

Newbuilding costs for Methanol fuelled ships are lower than comparable LNG vessels and conversions are becoming viable for modern engines – both from a cost and technology perspective.

Perhaps most importantly, Methanol is a liquid fuel, simple to handle and easy to bunker. As the low carbon transition intensifies, it is more important that ever to identify pathways for adoption that are manageable for all stakeholders and come with regulatory approvals.

Methanol lowers pollution emissions as a benefit to public health and acts as a bridge in lowering CO2 now and in the future, when increased renewable methanol will be net carbon neutral from well to wake.

It may not be the only marine fuel in future, but its role will be central to a lower carbon shipping industry.

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