This ship here in Copenhagen is different from all the other container ships sailing the oceans.
Why? Well, this is the world’s first container ship fuelled by green methanol.
Transport is responsible for around 15% of global greenhouse gas emissions.
Shipping is a bellwether for the global economy and the movement of goods.
In fact, if shipping was a country, it would be the sixth largest emitter of CO2.
To make the matter worse, emissions from shipping increased by 5% in 2022 and they are
expected to keep rising in the coming years.
But here, in Denmark, the world’s second largest
shipping company is trying to change that. This is the first Maersk vessel run with
green methanol – an alternative fuel. Practically speaking,
this means that this vessel emits 100 tons of CO2 less per day than a traditional ship.
Green methanol uses biomass or captured carbon and hydrogen from renewable power.
But it’s been a laborious process to put this container ship together.
It all started in South Korea, at the Hyundai Mipo Dockyard in 2021.
The construction process involved design and engineering challenges. The biggest of them all:
how to build a methanol supply system. According to Maersk, the construction of
this vessel required 5,000 engineering hours more than a traditional project.
It also comes with a cost. Each green-methanol vessel is about 10 to 15% more expensive than
traditional cargo ships. But Maersk isn’t the only
company trying to decarbonize container ships. Other shipping lines such as Evergreen and Cosco,
have also ordered methanol powered ships, albeit with less ambitious timelines.
And British firm BAR Technologies has developed giant folding “sails”,
which were added to a cargo ship chartered by American conglomerate Cargill. The sails are
expected to generate average fuel savings of up to 30%, thus reducing a ship’s carbon footprint.
We can, on one hand, have ambitious goals for the climate and for the shipping industry. And on the
other hand, also have a huge investment already now in the green transition. So,
climate, ambitious goals and green jobs goals, hand-in-hand, seen from our point of view.
This is the first, the first step for us. But it's the first step for the industry as well.
The ship was ordered only in 2021, and she was really the first of its kind. Today, just a couple of years
later, we have 125 ships that have been ordered by different companies to actually work on the same
technology and the same energy transition. So this ship is really a trendsetter for a whole industry.
As of the middle of 2023,
Maersk has ordered 25 methanol powered vessels. In total, Maersk has a fleet of 700 vessels.
Though some are leased, the idea is to replace or update the entire fleet in the next 17 years.
Maersk is looking to become carbon neutral by 2040, so all of these new vessels will be an
important part of meeting that deadline. However, analysts are worried that Maersk
and its competitors might struggle to find enough supply of green fuel for these vessels.
Explain to me why you're so worried about the supply of green methanol?
When I look at the market for these green fuels,
methanol is definitely one of the most advanced products out there at the moment. But what I
can hear from the industry and from market participants is that it hasn't ramped up very
fast. And there will be a significant time where I believe that we will have
more methanol vessels than there will be green methanol to supply those vessels.
The shipping giant has signed deals with at least 9 companies. But production of
green methanol is scarce and costly. Its current output is also far from meeting global demand.
At the same time, it is produced far from the bunkering hubs,
which adds to transportation costs.
When we ordered the ship, the real question was
the engineering behind the engine, the propulsion and how the ship was going to work. As soon as we
had this in place, the next problem is actually to have the availability of the fuel at a price
that is still competitive for us, for us to use. And this has been actually the main
headache for a while. And it continues to be as we need to scale this up,
and we need to grow the supply of the ship. Some of these projects take time to come into place.
What are you doing to essentially reassure the markets that you’ll be able to find
the green methanol that you need?
The plan for us has always been that,
and that's how we've made also our commitment towards 2030 and 2040,
that as these new ships phase in, they will be able to run on green methanol. It is not like
every supply is signed up all the way up to 2030 and in the quantity that we are looking for. But
I think that we are more confident today than we were a year ago. And we continue to work at
this to ensure that it is indeed the case.
It is quite revolutionary for the industry,
but with all big revolutions, it starts with small steps before it becomes industry wide.
It will take time before we will see, you know, a big impact on the shipping
business from these methanol vessels.
There have long been calls for more
ways to tax the industry in order to tackle its growing carbon footprint.
In June, a group of 20 nations supported a plan for a levy on shipping industry emissions –
the idea is to push the industry to move faster on decarbonization.
Initial estimates suggest the measure could raise around $100 billion a year, which would then help
smaller economies deal with climate change.
But China, Argentina and Brazil are among the
nations pushing back against such a levy.
Our position is that we need a global levy.
But we also need it to support, let's say, the global south when it comes to their development.
Neither the Kyoto Protocol nor the Paris Climate accords addressed the carbon
footprint of shipping, but that changed in 2018 when the International Maritime
Organization agreed to cut greenhouse gas emissions by 50% between 2008 and 2050.
In the same year, ships docking at EU ports have also had to account for
their fuel consumption and CO2 emissions.
More recently, the EU proposed a scheme which
will see shipowners having to buy carbon credits equal to all their emissions inside the EU and
50% of emissions generated by international voyages that start and end in the bloc.
It is a global industry. And if you want to make a global agreement, you have to have, I mean,
more or less all countries behind the agreement, and then it is a industry in a highly competitive
market. That has also been a key factor, of course. But again, I'm extremely positive that
we actually succeed. I've been involved in many discussions and heard all the views, also the
challenges, all the problems, but, so the baseline is that everybody agrees that we have to move now.