Don’t drink the Kool-Aid: fuel debate reveals divergent views

Did my commentary a few days ago quoting Dr Tristan Smith’s remarks about the inevitability of a carbon-free fuel environment by 2050 reveal that I have been ‘drinking the Kool-Aid’*, as one reader suggested to me? Or was it, as a commentator on LinkedIn remarked, a “great article [with] very good insights from Tristan on the issues surrounding the decarbonisation of shipping”?

Perhaps you agree with the reader who urged me to “keep up the good discussion: the topic is spot on. Ordering another ship with a conventional propulsion system is the biggest mistake a shipowner can make”? Or do you empathise with the correspondent who is “scared” by the statement I quoted from the International Chamber of Shipping (ICS) warning of the lack of suitable technologies to meet IMO’s greenhouse gas (GHG) reduction targets?

I have been inviting reactions to a series of comment pieces over the past few weeks on the general subject of fuel availability and its associated regulatory implications and my piece based on Tristan’s remarks – he is Reader in Energy and Shipping at University College London – prompted more feedback than usual.

I have been focusing on this theme because the 1 January 2020 deadline for reduced sulphur emissions is now less than five months away and must be high on the agenda of many company board meetings. My aim has been to flag up some aspects of the debate that should be taken into account and in this instalment I will summarise some of the feedback I have received in the past few days. From the brief extracts I have quoted above, it is clear that this is a polarising debate.

First, I’ll pick up on the question of high-sulphur fuel oil (HSFO) availability post 2020. I had previously relayed comments by an oil refinery expert who had argued that refineries would have no incentive to produce HFO in the future and invited a reasoned argument to show the contrary.

Scrubber maker Pacific Green Technologies (PCT) has sent me a response that describes those who warn of an HFO shortage as ‘alarmists’ but it acknowledges what my consultant had said about refineries being built in India, the Middle East and Asia: that “most are not producing any bunkers in their economic models.”

“This is true,” PCT accepts; “most new refineries will be super-modern and will not produce HSFO in the medium-to-short-term.” However, “there are 700 refineries in the world and very few are super-modern.” Many cannot afford to upgrade and for those that can, there is no hurry: “given that the uptake of scrubber-installed vessels is increasing, most refineries see no immediate need to upgrade. There will be plenty of customers for their HSFO and they can upgrade gradually,” PCT said.

To be fair, Tristan made a similar point in his comments so there is agreement that HSFO can be available for some time to come. Whether bunker suppliers will stock it remains to be seen.

Meanwhile, IMO’s GHG emission reduction timeline cannot be ignored. But what does its target of reducing carbon emissions by at least 50% by 2050 actually mean? “The amount of ignorance [being shown] about ‘Green’ and ‘renewables’ is actually quite astounding,” my Kool-Aid correspondent said. What about the carbon footprint for wind blades (made from carbon), or mining the cobalt and lithium needed for batteries, he wondered?

IMO’s Initial Strategy on reducing GHGs from shipping is silent on this, but it does include a list of 13 ‘candidate short-term measures’, one of which is to “develop robust lifecycle GHG/carbon intensity guidelines for all types of fuels” (4.7.11; you can read the full text here). If the word ‘lifecycle’ is intended to include a fuel’s carbon-footprint during manufacture, it is not spelled out and the tone of the document is very much focused on emissions from ships themselves.

Of course, this is just an initial strategy; perhaps further strategies will look at the bigger picture but, as it stands, it appears to be addressing only GHG emissions from ships themselves, which is treating some of the symptoms rather than the whole disease.

Whatever IMO’s figures represent, the International Chamber of Shipping has said – as I mentioned in my previous article – that “the technologies necessary to achieve [them] do not currently exist at a scale or in a form which is commercially viable for widespread use by international shipping.”

My ‘scared’ correspondent takes issue with this. He is Brian Boserup, founder of the Danish think-tank Blue Technology and he told me that he has spent 11 years “working to bring shipping on the zero emission track.” He expects to have a demonstrator ready by August 2021 and is confident that “when the world becomes aware that we can go to zero emissions with already-known technologies, the legislation will soon follow.” I have asked him for some details about his work.

It is vital that decisions at every level – from individual ships to global policies – are taken on the basis of informed analysis. Yet, from the reactions I have received over the past few weeks, it is clear that this is only part of the story: there is a lot of analysis available but different interpretations of it create the polarisations I have outlined here.

Do they matter? In the short term, no. But if IMO or regional or national authorities were to include carbon-reduction deadlines in statutes – echoing the tiered-approach we saw to NOx reduction – things will become more serious. In the light of that, I would like to move the discussion onto whether IMO’s GHG dates should become more than an aspirational strategy and what would happen if they did. Email me with your thoughts now.

*‘Drinking the Kool-Aid’ describes someone who has “accepted an idea or changed a preference due to popularity, peer pressure, or persuasion,” Wikipedia says. It has a macabre origin in the 1978 Jonestown massacre.

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