ORDERBOOK ANALYSIS HINTS AT IMPORTANCE OF DROP IN BUNKERS, RETROFIT SOLUTIONS TO MEET IMO EMISSIONS TARGETS

An analysis of the current orderbook of Clarksons Research has hinted at the importance that retfrofit and drop in fuel technologies could play as the industry looks ay ways to meet its emissions reduction targets.

Writing in its latest weekly report, managing director Steve Gordon echos the sentiment of many in the industry by noting that the “timing technology choice and financing of the investment required to reduce shipping’s GHG emissions…remains a huge hurdle for stakeholders across maritime.

Indeed, earlier this month shipowner groups representing some 90% of the global fleet reiterated to IMOs 75th session of the Maritime Environment Protection Committe (MEPC75) they believe the technlogy and mechanisms to fully achieve the targets do not currently exist.

Even so, Clarksons Research analysis shows investment in alternatively-fuelled tonnage is underway with 15.2% of the orderbook (27.2% in GT terms) comprised of the vessels that will be able to ıse some form of alternative to traditional oil bunkers.

Of those, LNG is by far the dominant choice of energy source with gas-powered vessels representing 10.7%  of the orderbook, or 24.6% in GT terms. This is to be expected given the push for LNG has been underway for several years, and while supply infrastructure for most other alternative fuels such as hydrogen and ammonia is practically zero, a meaningful LNG bunker supply network has been established and is growing.

Clarksons data indicates 124 ports now have LNG bunkering facilites in place.

The Alternative Alternatives

Vessels on order with planned installations of battery/hybrid propulsion systems make up the bulk of those not adopting LNG, totalling 3.2%, of the orderbook but just 0.7% in GT terms.

As the recent order by Norwat-based Misje Rederi group highlights, while battery power remains some way off being the sole source of energy for deep sea vessels, it is starting to feature as a way for larger vessels to cut emissions when at-berth and when performing port and cargo operations.

The remainder of alternatively fuelled vessels include those opting for hydrogen, methanol, an LPG, among others, and together make up around 2% of the orderbook both vessel number and GT terms.

With an owner looking for a lifespan of 30 years or more from their vessels, tonnage ordered today could well live through both the IMO 2030 and IMO 2050 GHG reduuction milestones – altough some see the energy transition cuttiing short the commercial life of vessels.

Another factor to keep in mind, as recently highlighted by shipbrokers SSY, is that newbuilding prderbooks have fallen to historically low levels relative to existing fleets.

In all, while Gordon sees industry emissions targets prompting newbuilding orders perhaps hitting $1 trillion this decade, with relatively small numbers of alternatively powered vessels in the water and an order it is no surprise why interest in GHG reducing retrofits such as rotor sails is on the rise.

Equallly so is the growing interest in zero and low carbon “drop in” fuels such as those supplied by Goodfuels, among others, as these cn be used in vessels designed to burn traditional oil-based bunkers.

Sourced by Ship & Bunkers News