All hands to the pump: every stakeholder needed to support marine ammonia fuel

For our final episode of Maritime Ammonia Insights, we turned the microphone around on our resident experts. Sofia and Conor Fürstenberg Stott (Partners, Fürstenberg Maritime Advisory) joined us to provide their insights on the pathway forward for marine ammonia fuel. You can watch a replay of the discussion here via the AEA’s Vimeo channel, and access the speaker slides here.

Rapid progress

The maritime ammonia value chain - as complex now as it was in 2020. From Maritime Ammonia Webinar for the Ammonia Energy Association (Dec 2023).
Click to expand. The maritime ammonia value chain – as complex now as it was in 2020. From Maritime Ammonia Webinar for the Ammonia Energy Association (Dec 2023).

In the two-plus years Conor & Sofia have been formally engaged as Maritime Directors at the AEA, they’ve seen remarkable progress. Back in 2020, they embarked on a mapping exercise of announced projects. Basic analysis showed how Nordic companies dominated the landscape back then. But the situation has become much more diverse, especially with the entrance of Japan, as well as Asian shipyards in Korea & China.

The knowledge acceleration about maritime ammonia has been a significant theme of the last few years. From Maritime Ammonia Webinar for the Ammonia Energy Association (Dec 2023).
Click to expand. The knowledge acceleration about maritime ammonia has been a significant theme of the last few years. From Maritime Ammonia Webinar for the Ammonia Energy Association (Dec 2023).

Another example of rapid progress is the knowledge acceleration about maritime ammonia. From feasibility & desktop exercises, we now have detailed studies on specific topics: environmental impacts, classification guidelines, human factors, and bunkering in Singapore among them. Consider as well the NoGAPS project, which has progressed from a gap identification exercise to concept design in just a few years.

Many of these topics have been the subject of past episodes of Maritime Ammonia Insights. Browse our webinar archive to learn more from two years of discussions – each with a matching article on our website.

Overlaying alternative fuels onto the existing bunker industry

The value chain of bunkering operations - a challenge for implementing alternative fuels like ammonia. From Maritime Ammonia Webinar for the Ammonia Energy Association (Dec 2023).
Click to expand. The value chain of bunkering operations – a challenge for implementing alternative fuels like ammonia. From Maritime Ammonia Webinar for the Ammonia Energy Association (Dec 2023).

As Conor explains, existing bunker industry practices are extremely well embedded, and overlaying alternative fuels is not going to be easy. Traditionally, bunker fuel deliveries sit in a tank until various tests (flash point, sulphur content etc.) are carried out, then the fuel is used. For low-carbon fuels, how do you adequately prove that the fuel you’ve delivered is not only on-spec, but also low-carbon, meeting whatever regulatory requirements the ship operator or owner needs to worry about? Certification of low-carbon fuel – and getting this data directly into the hands of ship owners & operators – is crucial. But the maritime industry has probably not grasped how important certification is yet.

Consider also that all bunker deliveries currently come with a paper note. When you want to include detailed carbon intensity data with each fuel delivery (potentially hundreds of millions of tonnes around the globe), a paper-based system just won’t cut it. There are digital bunker note trials in progress.

Coordination, cooperation

IBIA’s joint submission to the IMO in June 2023, advocating for emissions accounting on a well-to-wake basis. From Maritime Ammonia Webinar for the Ammonia Energy Association (Dec 2023).
Click to expand. IBIA’s joint submission to the IMO in June 2023, advocating for emissions accounting on a well-to-wake basis. From Maritime Ammonia Webinar for the Ammonia Energy Association (Dec 2023).

It seems self-evident, but coordination & cooperation between parties will be key to meeting this challenge. Conor highlights a big achievement this year, when the International Bunkering Industry Association, AEA, Methanol Institute and European Biodiesel Board came together for an important contribution at the IMO. The joint submission (and in-person presentation) in June advocated for the adoption of emissions accounting on a well-to-wake basis. For the first time, associations like ours were talking in the same language and agreeing what “low-carbon” means – something we really haven’t seen until this point in time.

Talking about competition misses the point

Consider the commitments to deploy renewables just announced at COP28 to raise the total to 11,000 GW installed by 2030, adding roughly 1,000 GW each year. The scale-up of alternative fuel production sits downstream from this already immense challenge. Talking about competition between fuels misses the point that we will need all the alternative energy options we can muster. Ammonia, methanol, biodiesel, renewable, CCS-based projects and more all need to start operating ASAP so we can meet the 2030 target. Cooperation & coordination is absolutely key to this (maybe more important than anything else), hence why the IMO submission was such an important milestone.

Including seafarers in the entire story

For all the discussion and conversations had in high-level fora like the IMO, Conor can’t recall many times when actual seafarers were included. We can’t leave it until the ships are on the water: seafarers need to be brought in early, ideally at the design and concept stage.

Sofia added that FMA gets a lot of comments from current and ex-seafarers who have their doubts about ammonia fuel. This can’t be brushed aside. The industry has been doing much more dangerous things for many years, but that perspective alone won’t win the public perception battle. We shouldn’t forget the conversations going on a few decades back about LNG – and especially cryogenic LNG – when it was first introduced as a fuel. There was a lot of skepticism back then, and serious safety concerns (for good reason). But, the problems were worked through. Early, proactive, well-invested training programs were critical then, and they will be critical now.

Just & equitable

The obstacles ahead for marine ammonia fuel. From Maritime Ammonia Webinar for the Ammonia Energy Association (Dec 2023).
Click to expand. The obstacles ahead for marine ammonia fuel. From Maritime Ammonia Webinar for the Ammonia Energy Association (Dec 2023).

Another obstacle is that the IMO will simply fail to reach agreement if the member states do not agree that proposed measures will support “just & equitable change”. Global South countries and Small Island Developing states will have to be part of the consultation process, and must have their input. There is a recent report from the Maersk McKinney Møller Centre on “just & inclusive green corridors” that explores this point.

Call to action: who & what

As a way to break the supply-demand chicken & egg problem, Sofia would like to see all the world’s big ports undertake a bunkering study like Singapore’s. In fact, it’s a little surprising (and disconcerting) that no one else has taken Singapore’s lead to date. The latest GMF progress report on green corridors suggests that a serious lack of initiative is holding back change in the maritime industry. As Sofia wrote in a recent article for Bunkerspot, we need “business as unusual” – guts, determination, and not sitting around and waiting for the market to magically appear.

So far, success with ammonia fuel has been regional. Successful business cases have been built in Scandinavia (especially Norway). Looking regionally for opportunities is a good start – in fact there may be other stakeholders looking for similar opportunities. Sofia’s feeling is that these regional success stories will be a model for years to come.

The road ahead for marine ammonia fuel at the IMO, with plenty of opportunities to get involved. From Maritime Ammonia Webinar for the Ammonia Energy Association (Dec 2023).
Click to expand. The road ahead for marine ammonia fuel at the IMO, with plenty of opportunities to get involved. From Maritime Ammonia Webinar for the Ammonia Energy Association (Dec 2023).

For Conor, 2024 is the year to get involved with the IMO Working Groups. There is also a terrific opportunity for stakeholders to educate themselves, and learn about all the different factors that will affect the uptake of alternative marine fuels. Typically, ship owners and operators tend to have little in-house capacity for this, but luckily there’s a wealth of resources out there. A whole ecosystem of NFPs, NGOs and trade associations (including the AEA) are delighted to share their work. There are piles of information and many avenues to get engaged. The choice is where you put your time.

Where are we in 2030?

To finish our session, we asked Sofia & Conor to look ahead to the end of the decade. Sofia forecasts that in 2030, maritime ammonia has just started to be available at scale. At the pump, methanol is the predominant alternative fuel, but everything else required for ammonia is ready and the holistic case is there.

Conor sees alternative maritime fuels as a rolling stone gathering momentum. MAN ES recently reported that it has 8Mt per year worth of ammonia engines on-order today, with most of those hitting the water over the next five years. There is also the recent Maersk announcement for 10 VLACs to be added to its fleet – more evidence of growing momentum. Methanol certainly has the head-start, but by 2030 ammonia is well and truly catching up. The alternative fuel predictions from the IEA, DNV etc. are proving correct to this point in time, so there’s no reason we can’t hit our targets.

Click here to watch a replay of the discussion via the AEA’s Vimeo channel.
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