Op-Ed: Fueling the transition: Is shipping on course to reach net zero by 2050?

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by Melissa Williams. vice president marine, Shell Marine

The way I see it, shipping has a very simple business model, made complex by its size. When it comes to decarbonization, it’s this size – plus uncertainty over the correct pathway to take – that pose the biggest challenges to our industry. At Shell, we’re confident in delivering effective solutions to drive the energy transition. However, is the sector really ready to navigate this uncertainty and to chart a clear, practical, and financially realistic route to decarbonizing shipping?

HOW TO DECARBONIZE A PARADOX INDUSTRY

The timeline is an issue for one, since we can’t simply rebuild the almost 100,000 commercial ships that make up today’s global shipping ecosystem. And while shipping is indispensable to the global economy, transporting more than 80% of world freight , the sector is responsible for 3% of global emissions as a result.

Shipping therefore has the unenviable task of meeting the demand of the world’s growing economy, while radically reducing its emissions – a paradox that needs solving, and quickly. But change won’t be simple, given that the sector continues to rely overwhelmingly on fuel oils, while its 2050 emissions footprint is predicted to be up to 130% that of 2008 figures. Faced with this data, the only option is for the industry to accelerate its action.

THE IMPORTANCE OF POLICY LEADERSHIP

As uncertainty and scale are two of shipping’s biggest decarbonization challenges, it makes sense to explore their main point of intersection: the large, global fleet of vessels with a significant lifetime remaining, and the pressing regulatory challenges affecting them.

The ambiguous regulatory landscape is leaving many operators unsure of which steps to take next in their decarbonization journey, since it’s not entirely clear what kind of flexibility needs to be built into today’s vessels to meet tomorrow’s demands.

And that’s before we even mention the elephant in the room: the fuel powering these ships and the absence of global regulations mandating its own transition. Which is why Shell supports the introduction of ambitious regulatory measures at a global level, to provide that commitment for the sector to reach net-zero emissions by 2050.

PIECING TOGETHER THE FUEL MOSAIC

Let’s be clear: we believe that there is no one fuel, technology or solution that will singlehandedly address the challenge of decarbonizing shipping across all segments. As of yet, no fuel alternative has the exact same scale, energy density, comparative cost, and therefore competitiveness, as fuel oil. With this in mind, a mosaic of fuels will likely be needed to transition shipping towards a decarbonized future.

While a one-size-fits-all solution might be preferable, there are in fact benefits to having options. And by favoring “viable” over “perfect” solutions, we can prioritize immediate action. There are fuel alternatives available today that offer effective pathways to decarbonisation in the interim, before the next generation of hydrogen-derived, low- and zero-carbon fuels are available at scale:

Moving from fuel oil to LNG-burning engines today will be key to reducing emissions, since LNG engines provide an emissions reduction of up to 23% Well-to-Wake (WtW) compared with their fuel oil counterparts. Thus far, LNG is the lowest carbon option available to the industry at scale and is a ready-now route to reduce greenhouse gas (GHG) emissions and air pollution.

Liquid biofuels present another important lever. Biodiesel, or fatty acid methyl ester (FAME) for example, is already available at scale and can be blended into fossil fuels to reduce their GHG intensity. Though feedstock scarcity puts at risk progress here, sustainable production capacity will continue to be scaled up.

THE ROLE OF VESSEL EFFICIENCY

Ultimately, the action we take to decarbonize now will help to accelerate the commercial viability and uptake of future hydrogen-derived, zero-carbon fuels.

However, this will heavily depend on the technological maturity of decarbonization solutions and infrastructure developments throughout the value chain, while also making the business case for investment in alternative technologies.

Alongside fuel innovation, technology will play its part too, with operational efficiency and energy efficient technologies helping to narrow the gap to net zero today. Meanwhile, these technologies can also deliver more efficient means of propulsion to overcome the energy density challenges associated with future fuels, and should therefore be a priority for the industry as the mosaic continues to take shape.

Perhaps the most pivotal role technology will play however, is in the development of fuel cells. Fuel cells significantly improve energy conversion efficiency to above 60%, and potentially even 80% if the produced heat is harnessed, providing a critical step change for vessel efficiency.

COLLABORATION IN ACTION

While much uncertainty remains, one thing is clear: in pursuing this new energy future, shipping will undergo a radical transformation. That’s why it’s vital we – both Shell and the industry – keep collaborating, so we can provide customers with the right solutions to support their transition.

Hence our agreement to work with industry partners such as MSC to develop a range of safe, sustainable and competitive technologies that can reduce emissions from existing assets, helping to enable a net-zero future in the process. Together, we aim to bring even greater industry clarity on technology, fuels, and advocacy, so companies can turn challenges into opportunities to thrive.