The EU initiative FuelEU Maritime requires carriers to lower their carbon emissions by 2% in 2025. However, experts in the field question if the availability of biofuels for the shipping sector will help achieve this goal.
Using alternative fuel is a key part of the carriers’ plan, but it is almost certain that they will have to use a certain fuel mix in light of current limited availability and relatively increasing demand, not only within the maritime sector.
According to Sverre Alvik, director of DNV’s Energy Transition Outlook, “Both availability and demand are currently limited. Thus, there is a lack of demand as well as a lack of supply production.”
DNV, a leader in the field of sustainability research, says there are three types of biofuels relevant to maritime shipping. These are:
- FAME (Fatty acid methyl ester) which is produced from vegetable oils, animal fats or waste cooking oils,
- BTL (Biomass to liquid) fuels and they are synthetic fuels that are produced from biomass by means of thermo-chemical conversion, and
- HVO/HDRD (Hydrogen vegetable oil / Hydrogenation derived renewable diesel) is the product of fats or vegetable oils – alone or blended with petroleum – refined by a hydrotreating process
DNV research estimates that the market could see competition over certain types of fuels, namely the waste-based biomasses which are expected to be effective in cutting down carbon intensity in both shipping and aviation.
In the meantime, analysts have recently highlighted that carriers need to understand and well-define the types of alternative fuels they want to use. This will largely depend on the definitions placed by the regulating bodies such as the IMO and the EU.
