EU Member States cleared the way to bring sustainable renewable fuels into maritime transport. They approved the “FuelEU Maritime” regulation. The EU Parliament had also voted in favour of the agreement reached in the trilogue procedure.
The new requirements will apply to ships with a gross tonnage of more than 5,000 entering, leaving or staying in ports in the territory of an EU Member State. In addition, shore-side electricity will be mandatory for container and passenger ships from 2030. The use of synthetic fuels from renewable energies will be specifically promoted for shipping.
Federal Minister of Transport Dr Volker Wissing:
After we were recently able to achieve a breakthrough for maritime climate protection at UN level, we are now pushing the actual transformation towards climate-neutral shipping at European level with the “FuelEU Maritime” initiative. The draft regulation is open to technology and takes into account the special competitive conditions in the maritime transport sector. The main objective is to increase the demand for renewable and low-carbon fuels and their consistent use, thereby decisively reducing greenhouse gas emissions in maritime transport. The initiative is thus expected to play a fundamental role in the implementation of the European Climate Change Act for shipping.
Federal Environment Minister Steffi Lemke:
Today the EU has set a decisive course for more climate protection and the use of renewable fuels in maritime transport. Shipping companies will continue to rely on fuels in the future, because electric drives are not yet an option for long-distance transport. In maritime transport, e-fuels from renewable energies are therefore a sensible climate-friendly alternative. With the new requirements, the EU is giving manufacturers and shipping companies the necessary planning security, driving forward the development of modern technologies and making renewable fuels for maritime transport ready for the market. But there are also shadows: The fact that fuels from fossil sources and nuclear energy are also permitted as a compliance option is regrettable. The German Federal Ministry for the Environment, Nature Conservation, Nuclear Safety and Consumer Protection (BMUV) will continue to advocate the use of predominantly synthetic fuels from renewable energy sources in order to make maritime transport climate neutral.
FuelEU Maritime lays down uniform EU-wide rules for limiting the greenhouse gas intensity of the energy used on board a ship, and thus above all the fuels. The regulation from the Fit for 55 package stipulates that shipping in the EU must reduce its emissions by 2 percent from 2025, 6 percent from 2030, 14.5 percent from 2035, 31 percent from 2040, 62 percent from 2045 and 80 percent from 2050. The GHG intensity reduction targets are set against the 2020 average GHG intensity of energy consumed on board ships. The greenhouse gas emissions of all fuels are assessed on the basis of a life cycle assessment (so-called well-to-wake (WtW) approach that includes the greenhouse gases carbon dioxide, methane and nitrous oxide). All fuels are permitted as a compliance option; the legislative initiative is thus technology-neutral.
The use of synthetic fuels is encouraged by a special mechanism: if the share of synthetic fuels from renewable energy sources (so-called “renewable fuels of non-biological origin, RFNBO) in the fuel mix does not exceed one percent in 2031, a mandatory minimum quota of two percent for these RFNBO fuels will automatically come into force from 2034. Beyond the use of alternative fuels, the FuelEU Maritime Regulation obliges container and passenger ships in ports in the territory of a Member State to use shore-side electricity or alternatively zero-emission technologies for on-board energy supply.
This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union. It shall apply from 1 January 2025, with the exception of certain Articles which shall apply from 31 August 2024.
MOL joins GCMD as impact partner to accelerate decarbonisation. Image: Pixabay
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The Global Centre for Maritime Decarbonisation GCMD and MOL announced the signing of a five-year Impact Partnership agreement. On the same day, both parties held a signing ceremony at the GCMD office in Singapore.
Decarbonisation in the maritime industry is a challenge that needs to be achieved through accelerating collaboration and increasing investment by shipping companies, their customers, ports, energy suppliers and public sector actors. As an Impact Partner of GCMD, MOL will utilise its expertise developed over their long history and make various contributions and collaborations through its participation in GCMD’s projects, including providing access to vessels, operating data and evaluation reports so that internal learnings can be shared publicly and used for future trials.
MOL is one of the world’s leaders in the maritime industry and has been leading worldwide discussions on achieving decarbonisation. The carbon budget concept imposes a ceiling to the cumulative amount of greenhouse gas (GHG) that can be emitted globally in order to limit global temperature rise to 1.5 degree Celsius by 2050. Intermediate targets to reduce emissions, in addition to a net-zero target, are necessary. While plans are in place to adopt low or zero emissions vessels in the future, it is important to deploy measures to reduce emissions now. Such measures include the use of low-carbon and transition fuels that are available today, and deploying energy savings devices onboard vessels. MOL will bring its extensive capabilities and experience to bear as it joins GCMD and existing partners to accelerate international shipping’s decarbonisation.
Professor Lynn Loo, CEO of the Global Centre for Maritime Decarbonisation, said: “We are proud to have MOL, one of the leading shipowners in Japan, come onboard as an Impact Partner. We are excited to tap on MOL’s track record in developing technical energy efficiency measures to broaden our perspective as we scope an initiative to help increase industry adoption of measures that can increase fuel efficiency of ships.”
Toshiaki Tanaka, Representative Director, Executive Vice President Executive Officer, and Chief Operating Officer of MOL, said: “We are very pleased to be a partner of one of the most important global coalitions. We will make our biggest effort to contribute and accelerate progress towards the net zero future in maritime industry, together with GCMD and all its partners.”
About the Global Centre for Maritime Decarbonisation
The Global Centre for Maritime Decarbonisation (GCMD) was set up on 1 August 2021 as a non-profit organisation. Our strategic partners include the Maritime and Port Authority of Singapore (MPA), BHP, BW Group, Eastern Pacific Shipping, Foundation Det Norske Veritas, Ocean Network Express, Seatrium, bp, Hapag-Lloyd and NYK. Beyond the strategic partners, GCMD has brought on board 15 partners that engage at the centre level, in addition to more than 80 partners that engage at the project level.
Strategically located in Singapore, the world’s largest bunkering hub and second largest container port, GCMD aims to help the industry eliminate GHG emissions by shaping standards for future fuels, piloting low-carbon solutions in an end-to-end manner under real-world operations conditions, financing first-of-a-kind projects, and fostering collaboration across sectors.
Hapag-Lloyd partners with DB Schenker to decarbonise supply chains. Image: Hapag-Lloyd
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Hapag-Lloyd has entered into a partnership with DB Schenker for the purpose of decarbonising supply chains. Following the launch of “Ship Green” in May, the renowned logistics provider has selected Hapag-Lloyd’s sustainable transport solution as part of its sustainability initiatives.
DB Schenker and Hapag-Lloyd have signed an agreement for emission-reduced container transports with a waste- and residue-based biofuel. By end of 2023, DB Schenker plans to claim approximately 3,000 metric tonnes of carbon dioxide equivalent (CO2e) emissions avoidance. This is based on at least 1,000 tonnes of pure biofuel.
“We are excited about this new partnership with DB Schenker as we share the common goal of making logistics more sustainable. Collaborations like these set a clear signal in the industry and are another example of a step-by-step approach to further decarbonise supply chains”, said Henrik Schilling, Managing Director Global Commercial Development at Hapag-Lloyd.
“I am very pleased that together with Hapag-Lloyd we are setting another example for sustainability in our industry. This partnership further enlarges our global biofuel offer in ocean freight. With this commitment we are one step closer to our goal of becoming carbon-neutral”, said Thorsten Meincke, Global Board Member for Air & Ocean Freight at DB Schenker.
Hapag-Lloyd has launched the Ship Green product to offer its customers emission-reduced ocean transports. Based on biofuel, customers of Hapag-Lloyd can add Ship Green as an additional service to their existing bookings – thereby avoiding CO2e emissions. Using the so-called “Book & Claim” chain of custody, Hapag-Lloyd can attribute avoided emissions to all ocean-leg transports, regardless of the vessel and route used. Ship Green is available for all shipments containing standard, hardtop or tank equipment. By offering Ship Green, Hapag-Lloyd is continuing along its path towards achieving climate-neutral fleet operations by 2045.
APM Terminal invests in port-equipment electrification pilots. Image: APM Terminals
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Electric cars are becoming common place on our roads, as fierce competition and economies of scale drive down prices, improve technologies and increase demand. This revolution has yet to happen for high-ticket, low volume port equipment. But that is now set to change. APM Terminals’ USD60 million investment in port-equipment electrification pilots, in collaboration with leading suppliers, is set to make the step-change needed to move the industry forward.
The global terminal company has committed to full carbon neutrality by 2040, a bold ambition it will achieve by optimising energy consumption, switching to green electricity, on-site renewables, and electrifying assets. Part of this transformation includes the switch from primarily diesel-driven equipment to zero-emission electric versions.
Over the next decade, APM Terminals estimates it will need to buy or retrofit over 2,650 pieces of electric heavy port equipment.
A key challenge facing the company, is the availability of competitively priced heavy-duty equipment such as reach stackers, terminal tractors, empty container handling equipment and straddle carriers. Research and development in this area has been slow off the mark and for ports around the world looking to make eye-watering investments in new electric equipment, numerous questions remain unanswered.
Its US$60 million electrification pilot programme is already underway in Aqaba Container Terminal, APM Terminals Barcelona, APM Terminals Mobile, Pier 400 Los Angeles and Suez Canal Container Terminal.
Long-term collaboration with suppliers
To support these pilots, APM Terminals recently signed groundbreaking agreements with Konecranes and SANY for a long-term collaboration on the further development of electric port equipment.
The company has ordered ten electric terminal tractors, two electric reach stackers and two electric empty container handlers from SANY. APM Terminals also became the first company globally to place an order for four battery-powered Konecranes Noell straddle carriers, to be delivered in Q3 2024. Both orders also include charging infrastructure.
Completion of the pilots is expected early 2025 and knowledge and insights gained from the pilots are likely to drive up supply, encourage the development of industry-wide best practices, and stimulate ongoing development long term.
Government support
The five terminals were chosen for their decarb-ready maturity levels, supportive local authorities, government and legislation. In these locations, next-level electrified equipment will be tested, and staff will be offered training in future-ready safety and maintenance protocols.
Jelle Burger, Program Lead Electrification Pilots at APM Terminals said the multi-million pilot and investment package was intended to ‘create a spark’ that will ignite the manufacturing sector, creating jobs and business opportunities.
In the next decade, APM Terminals estimates it will need to buy or retrofit over 1,500 electric Terminal Tractors (eTTs), 500 electric Reach Stackers (eRS), as well as electric Empty Handlers (eEH), electric Top Loaders (eTL), 100 electric Straddle (eSC) and Shuttle (eShC) Carriers and 550 Rubber Tyred Gantry cranes (RTGs).
Planting the seeds
“This is not an investment on which we will expect see an immediate or short-term return,” he said. “We are making this investment as a solid benefit for our customers in the long term. It can be seen as ‘seed money’ to stimulate growth in carbon-neutral tools for the benefit of the entire sector and the earth itself.”
APM Terminals has identified suppliers, including major names in the business, but also new entrants. “We see young, emerging companies ready to step up and deliver. They have the passion – and the prototypes. We are providing the resources to encourage growth, standardisation, and scale which will lead to accessible pricing,” said Burger.
Adding to existing fleet
In 2022, APM Terminals purchased over 180 pieces of electric or hybrid container handling equipment. Together with a switch to renewable electricity across its operations, direct electrification and green fuels APM Terminals will achieve its net zero objective by 2040.
