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Methanol is gaining momentum and supply won’t be an issue

by e1 Marine’s Global Commercial Sales Director, Maite Klarup

I recently participated in the TradeWinds Green Seas Fuels Forum “Solving the puzzle: lining up technology and supply for new fuels”, and the concept of using methanol as a hydrogen carrier was well-received by the panel. What challenged them, though, was the pathway from grey to green methanol and the potential lack of availability of the fuel.

A potential market is being built

Let’s first look at methanol’s potential as a green shipping fuel.

Methanol is a great transportation fuel with high energy density, wide availability, and safer than some fuels explored by shipping. It is currently available as a marine fuel at 122 ports around, and it is taking an early lead as a sustainable marine fuel that can support the industry’s decarbonization journey. Recent orders for methanol-powered ships by Maersk, CMA CGM, Stena, and COSCO have significantly boosted interest in the fuel. According to DNV, 22 methanol ships are vessels currently using methanol as a marine fuel. And the new orders of methanol ships are growing steadily: Maersk alone has ordered 19 dual-fuel methanol engines since 2021.

Methanol will come further to the fore as a fuel for powering fuel cells on ships. Hydrogen as an alternative fuel is a promising clean energy source but comes with significant storage, transportation and cost challenges. e1 Marine’s technology provides a solution that produces hydrogen at the point of consumption, eliminating the logistical challenges and costs of storing and transporting compressed hydrogen - not to mention some of the rules and regulations.

When used with PEM fuel cells, e1 Marine’s methanol reformer can produce hydrogen on board vessels, creating a safe, sustainable, and cost-effective solution. Our reforming technology generates onboard hydrogen simply using methanol mixed with water. This hydrogen then feeds into a fuel cell when and where it is needed. The remaining hydrogen-depleted gas is combusted to create the steam for the hot box reformer instead of being wasted. Further, the de-ionised water comes from the fuel cells, so it’s condensed and put back in the tank. It has zero particulate matter and no nitrous oxide or sulphur oxide emissions.

Therefore, methanol as a hydrogen carrier is becoming more attractive as a clean and sustainable future fuel for maritime fuel cell applications. In the deep-sea, cruise and inland waterways segments, we see a focus on replacing auxiliary engines with fuel cells to get emission-free power onboard, particularly for use while a ship is in port. And, in the deep-sea segment particularly, there is a class of vessel that is too young to scrap and too old to comply with anticipated 2050 regulations. These ships need retrofit solutions, such as fuel cells, to reduce emissions and enable them to remain compliant with IMO regulations such as the Carbon Intensity Indicator (CII) and regional regulation from the likes of the European Union and the state of California over the next decade.

The perceived availability challenge doesn’t exist

Now, let’s address concerns raised at the TradeWinds forum about the availability of methanol as a marine fuel. The concern is unfounded. The Methanol Institute is currently tracking more than 80 renewable methanol projects expected to produce more than eight million metric tons per year of renewable methanol by 2027. Projects are underway in Europe, North and South America and Asia.

This production will increase as demand from the shipping industry grows. As one example of this response, Spanish energy giant Iberdrola has announced the development of a new green hydrogen and methanol plant in Tasmania, Australia. The new facility, one of the largest in the world, will produce up to 300,000 tonnes of methanol for use as a marine fuel.

Across the industry, there is the expectation that methanol will be a more expensive shipping fuel than diesel, but this is an unrealistic simplification given the upcoming regulatory environment. Vessels that fail to meet Energy Efficiency Existing Ship Index (EEXI) and CII targets will only be allowed to operate for a while, and the extra cost of emitting CO2 will be expensive, particularly in the EU.

All eyes will be on MEPC 80

The shipping industry needs clearer mandates and stricter regulations to make it possible for new, green fuels and technologies to be adopted. We particularly need the IMO to drive regulatory change that sets a level playing field to make global shipping decarbonization a reality instead of fragmented regulation.

There is a critical window of opportunity to have our voices heard now in the lead-up to the IMO’s MEPC 80 meeting in July this year. This meeting is when the IMO has the unique opportunity to make the most critical climate decisions that will have huge consequences for shipping in 2023 and beyond. A clear and ambitious target will enable the maritime industry to invest in zero-emissions ships, fuels and technologies.

While we wait for clarity and direction, the industry is charting a way forward as best it can. We are confident that methanol's momentum will continue to grow but let’s look at the fuel for all of its potential as it has more than one role to play in shipping’s pathway to decarbonizing shipping. From our perspective, the real transformation is in making methanol the smart choice for making the use and transportation of green, fuel cell-grade hydrogen a commercially viable reality today.


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