Renewable hydrogen-based maritime fuels such as ammonia and methanol will not beat fossil fuels on price until 2040, according to a prominent shipping analyst, raising questions about the future decarbonisation of the sector.
Adam Kent, managing director of Maritime Strategies International, told the Marine Money Ship Finance Forum in London that his company has been examining when it would make economic sense for shipowners to switch to green fuels.
“Unfortunately, it is not until around the end of the next decade that it becomes more economically viable to run green fuels than conventional fuels, or conventional fuels with a scrubber,” he said, according to Hydrogen Insight sister publication TradeWinds.
“If we only start switching in 2040, we are going to be way, way too late to meet any [decarbonisation] deadline by 2050.”
Kent argued that, regardless of price concerns, top-tier shipowners need to order clean-fuel vessels as soon as possible, with green shipping corridors being established with bunkering facilities that can refuel them.
This would enable new ships to find their way into the second-hand market in five or ten years’ time, when they would be affordable for smaller companies, he explained.
Long-distance shipping is widely regarded as one of the key future industries for green hydrogen and its derivatives, because unlike other potential uses for H2, such as heating and energy storage, there is no all-electric alternative that could provide the energy required. In other words, it is highly unlikely that batteries fuelled by renewable energy would ever be able to store enough power to send a cargo vessel halfway around the world.
But the maritime sector is also one of the world’s laggards in terms of decarbonization, with the International Maritime Organization — the UN agency responsible for regulating shipping — only setting a target of reducing greenhouse gas emissions by 50% by 2050 (compared to 2008 levels).
This is in stark contrast to the 2050 net-zero goals being set by much of the developed world.
A version of this article was first published by TradeWinds on 25 January.
