Which fuel wins the carbon contest?

LNG, hydrogen, ammonia, methanol or LPG? The low emission fuel alternatives for the shipping industry are many. But they all come with certain advantages and disadvantages.

Choosing the right fuel solution can be a tough exercise for a shipping industry that is facing higher and higher expectations from regulators with regard to reducing carbon emissions. According to DNV, the choice of fuel can be the most important factor to achieve the target of net zero emission.

Business Development Manager Christos Chryssakis at DNV, says there are so many elements that have to be addressed, that a single, straight forward answer cannot be given. You have to take into account issues such as the benefits for the environment, the price and availability of the fuel, and the cost of investing in tanks that can store it.

According to Chryssakis at DNV, LNG is probably the best option for the time being. It reduces the emission of greenhouse gases (GHG) by some 15-20 %. LNG is relatively inexpensive, and prices are expected to normalize the next 1-2 years. Also it is easily available, compared to alternative sources of fuel. However, the cost of installing tanks that can store LNG is high compared to, for example, methanol.

Methanol, LPG and hydrogen

Ships sailing on methanol have a lower construction cost, and the fuel is easier to handle. However it is more expensive to operate. During an investment horizon of 20-25 years, LNG will be the most cost efficient, if we are to believe Chryssakis. Green methanol is not readily available today, but production is expected to increase soon.

LPG may be a good substitute for LNG. Liquefied Petroleum Gas contributes to reducing the emission of GHG by about 15 %. However, it is currently only used by LPG Carriers, and there is a limited number of engines available on the market.

Hydrogen is free of carbon atoms, but it takes plenty of energy from natural gas or power to produce the fuel. In Chryssakis´ opinion, you must consider how the fuel is produced, not only how green it is on its own. Besides, hydrogen requires large space for storage. That will impact the cargo load of the ship. However, hydrogen may be a good option for smaller vessels where you can refuel quite often, e.g. domestic ferries.

Ammonia has also been mentioned as a green and clean alternative fuel. The drawback is that ammonia is very toxic. Better regulations and engine technology are under development. It also requires energy to produce fuel based on ammonia, but somewhat less than the other options. Fuel based on ammonia needs approximately four times more space to store on board, compared to oil.

Availability

One common aspect with hydrogen, methanol and ammonia is that their green versions are not easily available. The companies producing and selling shipping fuel want to see a steady demand before they expand the capacity. The suppliers prefer having contracts with some long-term clients before they make large investments.

The main message from Chryssakis is that there is not necessarily one crystal clear answer as to which fuel is best for each ship, environmental-wise. It will take some time before all the options are easily available in the market. For now, it is the ship operator´s preferences that will be decisive, based on investment costs, fuel price, availability and cargo load.

Based on massive data collection, Maritime Carbon Solutions is today able to provide you with answers that may help you solve the emission equation for the various fuel solutions.

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