Wartsila is seeing a potential role for ethanol in the shipping industryâs multi-fuel future, with shipowners struggling to find suitable future fuels to reduce greenhouse gas emissions from their operations, according to a company official.
Mikael Wideskog, Wartsilaâs director for sustainable fuels and decarbonization, said the marine technology firm is in talks with shipping companies and fuel producers about how to introduce the fuel to the bunker mix. He declined to name them.
âEthanol is a good fuelâŠIt still contains carbon, but it can be a carbon-neutral fuel,â Wideskog told S&P Global Commodity Insights in a recent interview.
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While ethanolâs application as a marine fuel has been on paper only, Brazilian bio-energy firm Raizen â a joint venture between Shell and Cosan â is expecting 32 million cu m/year of ethanol to be consumed in the shipping industry by 2030.
The company, which is the largest ethanol producer from sugarcane globally, has aimed to produce a total of 4 million cu m/year of first-generation ethanol and 2 million cu m/year of second-generation, waste-based ethanol around the same time.
With the EU expected to impose strict sustainability requirements on ethanol, Wideskog said ethanol producers need to be careful not to take out forests and farming lands.
âImportant to keep in mind fuels need also to be sustainable, not competing with food,â he said.
Technical challenges
Currently, 99.5% of the worldâs fleet in operation are installed with conventional engines designed to be powered by oil-based fuels, according to classification society DNV.
While those engines can often run on fuel oil blends with biofuels like fatty acid methyl ester or hydrotreated vegetable oil, Wideskog said that using ethanol on a drop-in basis would require a change to engine settings and additional onboard bunkering systems.
âItâs technically possible, but the fuels [fuel oil and ethanol] will not be blended with each other,â said Wideskog, adding that they will need to go separately into a conventional engine.
But ethanol as marine fuel can ride on the increasing popularity of methanol in the shipping industry, he said. Based on shipbroker Braemarâs estimates, 26 methanol-capable ships were in operation and 101 on order as of March 23.
For the dual-fuel vessels that can be powered by conventional fuels and methanol, some tuning over engine parameters would allow them to run on ethanol, according to Wideskog.
âIt does not have to be retrofitted againâŠthe specifications between them [ethanol and methanol] are so close to each other,â said Wideskog, adding that the two fuels can use the same injection systems and tanks.
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âFrom the engine point of view, we treat methanol and ethanol as quite equal fuels,â he said.
Multi-fuel future
With regulators and customers pushing for decarbonization of maritime transportation, ship operators have been searching for the most commercially and technically viable green fuels.
Wartsila has been developing technologies for all sustainable fuels in the past two to three years as âthe industry did not know where it is going,â Wideskog said.
Many industry participants said the uptake of those alternative fuels would be slow amid limited supplies and high costs.
In its reference case, S&P Global does not expect any fuel to dominate the low-carbon marine fuel market in 2030. Methanol will have the highest share at 34.3%, followed by battery/diesel at 20.4%, hydrogen at 16.8%, and ammonia at 14.7%.
Regulatory drive
Looking forward, Wideskog said shipping firms will have to switch to low carbon fuels with new GHG regulations coming into force.
The International Maritime Organization, the UNâs shipping body, introduced its first set of emissions rules at the beginning of 2023 and promised to tighten its regulations through this decade.
Separately, the EU will extend its Emissions Trading System to cover shipping from 2024 and regulate the GHG intensity of marine fuels used by ships involved in the blocâs trade from 2025.
âAll these in place will, in my opinion, make the change happenâ, despite higher costs expected for green fuels, Wideskog said.
Platts, part of S&P Global, assessed fossil methanol as a bunker fuel at Rotterdam at $18.365/Gigajoule on March 27, versus $16.719/Gj for delivered 0.1%S gasoil and $13.049/Gj for delivered 0.5%S fuel oil. Industry estimates suggest green methanol could be at least two to three times more expensive.
âIt has to be paid somehowâŠthe ones buying the shipping service at the end of the day have to pay for this sustainability,â Wideskog said.
Source: Platts