Sustainable aviation fuel is a lead solution to reducing carbon emissions but synthetic fuels for shipping face major challenges. While leading companies in the aviation sector are busy producing over a million tonnes of synthetic fuel each year, efforts to produce low-carbon fuel for the maritime industry face a range of practical and cost-driven barriers.
International shipping accounts for 681 million tons of CO2 every year according to a recent report by ING. While the sector is improving in terms of energy efficiency, emissions are likely to stay at about 600 megatons as sea borne trade is expected to grow by 15 per cent by 2030.
The maritime industry faces a dilemma: shipping accounts for 90 per cent of goods transported around the world and it’s also the most energy-efficient mode of international freight transport. But it’s also a major source of global greenhouse gas emissions, ‘green’ alternatives are prohibitively expensive in a highly competitive market and net zero change is desperately slow.
Synthetic fuels could be the technology solution to meet shipping needs but they’re costly and lose more energy than fossil fuels. However, as the world tries to reach net-zero goals, maritime companies may have little choice but to use them because there are very few alternatives.
Synthetic shipping fuel
Synthetic shipping fuel is slowly being trialled and introduced and it could be the front-running technology as science improves and adapts. But all current alternative fuels come with carbon emissions attached, either in their use or in their production.
Outside the emission control areas very low sulphur fuel oil (VLSFO and heavy fuel oil (HFO), in combination with an installed scrubber, are the main fuels used by large marine vessels. HFO is the remnant from the distillation and cracking process of crude oil and it contains compounds such as sulphur, nitrogen and black carbon. Its use therefore has environmental impacts. A large emitter of CO2, HFO presents a major dilemma in deciding which pollution to reduce. Other oil-based fuels include marine gasoil (MGO and ultra low sulphur fuel oil (ULSFO which are obligatory in emission control areas.
Liquid natural gas (LNG) is an emerging fuel which is ‘cleaner’ fuel compared to oil-based fuels but is still a fossil fuel that emits CO2. Oil-based fuels emit 3.5 to 3.7 kilograms of CO2 per dead weight tonnage per kilometre. A similar ship on LNG saves about 30 per cent of carbon emissions but still emits 2.7 kilograms of CO2 per kilometre.
Methanol is made from syngas, which is a mixture of hydrogen and carbon monoxide and thus still contains carbon and ships that run on methanol still emit CO2. Emissions are reduced by about 20 per cent compared to oil-based fuels if the methanol is fully green (produced with green hydrogen and 100 per cent renewable power). When the methanol is produced with blue hydrogen, the vessel emits about 13 per cent less CO2.
Alternative fuels such as hydrogen and ammonia can greatly reduce carbon emissions in shipping, especially if they are produced with green electricity (green) or when carbon capture and storage is applied (blue). Carbon emissions from ships can be reduced or even nullified in the case of hydrogen or ammonia-powered vessels, especially when hydrogen needed to produce ammonia is produced with electrolysers that fully run on renewable power (the darkest green hydrogen).
The problem with synthetic fuels is that they have to be manufactured and the various processes are very energy intensive. For example, around 50 per cent of energy is lost in the production process of methanol and ammonia and up to 60 per cent of energy is lost by burning the fuel in the ship engine. Taken together, it means that up to 80 per cent of energy is lost and overall efficiency is just 20 per cent.
There are very few other zero-carbon options available for maritime shipping other than bio-fuels, of which the supply will be limited, so synthetic fuels will have to be part of the sector’s voyage to a net-zero economy.
Sustainable aviation fuel
Sustainable aviation fuel (SAF) is produced from renewable raw materials such as used cooking oil or animal fat from food industry waste. It meets all quality and performance requirements of conventional fossil fuels but costs up to five times more. It is identified by the International Air Transport Association (IATA) as one of the key elements to achieving the aviation industry’s emissions reduction goals and the organisation is hoping to see more than 100 million litres of SAF produced each year.
SAF is made from hydrocarbon molecules through a process called hydrodeoxygenation in which oxygen originating from renewable raw materials is removed with the help of additional hydrogen. Other impurities, like sulphur and nitrogen, are also removed during this process.
The fuel can be produced from a variety of sustainable resources, also known as feedstocks, including forestry and agricultural waste, used cooking oil, carbon captured from the air and green hydrogen. Seven biofuel production pathways are certified to produce SAF, which perform at operationally equivalent levels to Jet A1 fuel. By design these SAFs are drop-in solutions, which can be directly blended into existing fuel infrastructure at airports and are fully compatible with modern aircraft.
Singapore has one of the world’s largest sustainable aviation fuel (SAF) production capacities, with Finnish producer Neste aiming to produce up to one million metric tonnes of fuel in the country every year. Neste is currently the top SAF producer globally in terms of output and capacity with an annual production capacity of 100,000 metric tonnes at its facility in Finland. The company’s new $2.2bn facility in Tuas, Singapore will be able to produce one million metric tonnes of SAF per annum when the refinery is fully operational.
Singapore Airlines made its first flights using SAF in July last year. One thousand tonnes of neat SAF was supplied by Neste and blended with refined jet fuel at ExxonMobil’s facilities in Singapore, the new fuel trial expected to cut 2,500 tonnes of carbon dioxide emissions.
SAF credits and carbon offsetting
SAF credits provide customers including corporate and individual travellers and freight forwarders with an avenue to reduce their carbon footprint. Singapore Airlines (SIA) customers will be able to purchase a mix of SAF credits and carbon offsets, as part of the SIA Group Voluntary Carbon Offset Programme. SIA has partnered with Climate Impact X, a carbon credits exchange, to introduce a bundle of SAF credits and carbon credits. SAF credits aim to stimulate demand for SAF, support the development of the nascent SAF industry, and advance the adoption of SAF for aviation sustainability.
Regulation to accelerate ‘green’ fuels
In April 2023 the EU agreed to take forward the ReFuelEU mandate for synthetic fuels in aviation starting at 1.2 per cent in 2030 and increasing to 35 per cent by 2050. The scale of the mandate is significant and comes on the back of the recent concession to continuing manufacture of internal combustion engine (ICE) vehicles after 2035 provided they are also powered by synthetic fuels (e-fuels).
Spurred by the regulation and aiming to meet future demand for both aviation and auto fuel, the world’s first fully-featured synthetic fuel plant is to open in UK in June, the brainchild of a former F1 star. Plant Zero.1, co-founded by ex-Formula One engineering guru Paddy Lowe, will manufacture engineering-grade fuels to be used for market evaluations and approvals including ASTM certifications for flight and other applications, to be achieved in early 2024.
The International Air Transport Association estimates that SAF could contribute around 65 per cent of the reduction in emissions needed by aviation to reach net-zero in 2050. But this will require a major increase in production to meet demand with the largest acceleration expected in the 2030s.
Some forms of synthetic and low-carbon fuel will become universal in coming years however the pace of adoption is hard to anticipate although progress will accelerate when global regulation is aligned to ban all carbon-based fuels from the aviation and maritime industries.
Few of these alternative fuel sources, especially for shipping, are readily available and commercialised so production of large amounts of synthetic fuels is likely to face fierce competition for green carbon sources with other sectors at best, or competition for carbon shortages at worst.