A Pathway to Decarbonise the Shipping Sector by 2050

By International Renewable Energy Agency IRENA

This report explores the options and actions needed to progress towards a decarbonised maritime shipping sector by 2050 identifying a realistic pathway to reach the 1.5°C climate goal.

• Language: English
• Publisher: IRENA
• Release date: Jan 1, 2022
• ISBN: 9789292603854

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© IRENA 2021

Unless otherwise stated, material in this publication may be freely used, shared, copied, reproduced, printed and/or stored, provided that appropriate acknowledgement is given to IRENA as the source and copyright holder. Material in this publication that is attributed to third parties may be subject to separate terms of use and restrictions, and appropriate permissions from these third parties may need to be secured before any use of such material.

Citation: IRENA (2021), A pathway to decarbonise the shipping sector by 2050, International Renewable Energy Agency, Abu Dhabi.

ISBN 978-92-9260-330-4

eBook ISBN 978-92-9260-385-4

About IRENA

The International Renewable Energy Agency (IRENA) is an intergovernmental organisation that supports countries in their transition to a sustainable energy future and serves as the principal platform for international co-operation, a centre of excellence, and a repository of policy, technology, resource and financial knowledge on renewable energy. IRENA promotes the widespread adoption and sustainable use of all forms of renewable energy, including bioenergy, geothermal, hydropower, ocean, solar and wind energy, in the pursuit of sustainable development, energy access, energy security and low-carbon economic growth and prosperity. www.irena.org

Acknowledgements

This report was authored by Gabriel Castellanos, Roland Roesch and Aidan Sloan, under the supervision of Dolf Gielen.

Valuable input and comments were provided by IRENA experts Maisarah Abdul Kadir, Ricardo Gorini, Rodrigo Leme, Francisco Boshell, Paul Komor, Paul Durrant, Carlos Ruiz, Barbara Jinks and Herib Blanco.

IRENA appreciates the insights and comments provided by Nelson Mojarro (International Chamber of Shipping), Greg Dolan and Neville Smith (Methanol Institute), Trevor Brown (Ammonia Energy Institute), Ilkka Hannula (International Energy Agency), and Jesse Fahnestock (Global Maritime Forum).

IRENA would also like to thank the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety of Germany, as well as the Ministry of Foreign Affairs of Denmark, for providing funding for this study.

For further information or to provide feedback: [e-mail]

This report is available for download: www.irena.org/publications

Disclaimer

The designations employed and the presentation of materials featured herein are provided on an as is basis, for informational purposes only, without any conditions, warranties or undertakings, either express or implied, from IRENA, its officials and agents, including but not limited to warranties of accuracy, completeness and fitness for a particular purpose or use of such content.

The information contained herein does not necessarily represent the views of all Members of IRENA, nor is it an endorsement of any project, product or service provider. The designations employed and the presentation of material herein do not imply the expression of any opinion on the part of IRENA concerning the legal status of any region, country, territory, city or area or of its authorities, or concerning the delimitation of frontiers or boundaries.

Photographs are from Shutterstock unless otherwise indicated.

CONTENTS

◼FIGURES

◼Tables

◼Boxes

◼Abbreviations

◼SUMMARY FOR POLICY MAKERS

1. INTRODUCTION

2. SECTOR OVERVIEW

Maritime trade dynamics

International maritime fleet

Energy demand and the importance of energy efficiency

Navigation routes and bunkering infrastructure

3. RENEWABLE FUELS AND TECHNOLOGY READINESS

Liquid biofuels

Renewable gaseous fuels

Hydrogen

Methanol

Ammonia

4. DECARBONISATION PATHWAY

Establishment of energy scenarios 2050

Energy demand projections

Decarbonisation analysis

5. ENABLING ACTIONS TO RAISE THE DECARBONISATION AMBITION

6. OVERVIEW AND OUTLOOK

◼REFERENCES

◼ANNEXES

Annex A Decarbonisation measures and opportunities at ports

Annex B Energy efficiency solutions

Annex C Overview of engine technology

FIGURES

Figure i Global shipping energy demand and GDP

Figure ii EEDI phases, implementation periods

Figure iii Methanol cost projections

Figure iv Ammonia cost projections

Figure v Comparison of CO 2 emissions associated with each scenario, 2018-2050

Figure vi Estimated role of key CO 2 emission reduction measures associated with IRENA’s 1.5°C Scenario

Figure 1 Historical activity level of global trade

Figure 2 Total gross tonnage of ships worldwide, by type, size and year

Figure 3 Voyage-based allocation of energy consumption for international shipping

Figure 4 Average age of ships by type

Figure 5 Global shipping energy demand and GDP

Figure 6 Correlation between trade, manufacturing and energy demand in the shipping sector

Figure 7 Historical analysis of energy demand, maritime trade and net energy input

Figure 8 EEDI phases, implementation periods and reduction targets

Figure 9 SEEMP cyclical process

Figure 10 Historical activity level global average energy intensity (left) and carbon intensity (right) for the shipping sector

Figure 11 Main maritime shipping traffic routes

Figure 12 International shipping bunkering by country, 2017 (TJ/year)

Figure 13 Differences in feedstock and production methods for alternative liquid fuels

Figure 14 Comparison of life cycle GHG emissions associated with different biofuels

Figure 15 Cost comparison of advanced biofuels

Figure 16 Fuels produced from biogas through various methods

Figure 17 Cost comparison of renewable gaseous fuels

Figure 18 Green H 2 cost projections

Figure 19 The methanol production process

Figure 20 Methanol cost projections

Figure 21 Biomass sequestration combined with bioenergy production plus carbon storage and utilisation

Figure 22 Renewable e-ammonia production process via Haber-Bosch process

Figure 23 Ammonia shipping infrastructure including a heat map of liquid ammonia carriers and ammonia loading and unloading facilities

Figure 24 Ammonia cost projections

Figure 25 Scrubber payback period depending on the type and capacity of vessels

Figure 26 Activity level projection

Figure 27 Projected disaggregation of activity level depending on cargo type

Figure 28 Final energy demand projections, 2018-2050

Figure 29 Energy intensity global average for the shipping sector, 2018-2050

Figure 30 1.5°C Scenario energy pathway, 2018-2050

Figure 31 Comparison of CO 2 emissions associated with each scenario, 2018-2050

Figure 32 Estimated roles of key CO 2 emission reduction measures associated with IRENA 1.5°C Scenario

Figure 33 Activity-level carbon intensity (left) and energy-basis carbon intensity (right)

Figure 34 Feedstock requirements and range of renewable energy deployment associated with the inclusion of powerfuels in the 1.5°C Scenario by 2050

Figure A.1 Global shore power infrastructure

Figure C.1 Otto cycle in a four-stroke engine

Figure C.2 A diesel four-stroke process

TABLES

Table 1 Overview of operational and design EE solutions

Table 2 Main infrastructure in ports

Table 3 Comparison of different marine fuels

Table 4 Readiness level of shipping fuels

Table 5 Potential biofuels for the shipping industry and their viability

Table 6 H 2 production methods

Table 7 IRENA shipping energy scenarios

Table 8 Key drivers with the potential to increase final energy demand in the shipping sector

Table 9 Key drivers with the potential to decrease final energy demand in the shipping sector

Table A.1 Planned and existing CI-equipped ports

Table A.2 Comparison of hydrogen and battery fuel alternatives for short-range ships

BOXES

Box 1 Ocean Network Express conducts successful trial of sustainable biofuel for decarbonisation

Box 2 Viikki bulk carrier utilising 100% renewable LBG

Box 3 Fuel cells

Box 4 Kawasaki Heavy aims to replicate LNG supply chain with H 2

Box 5 Maersk aims for first carbon-neutral container ship in two years

Box 6 Acquiring carbon as a feedstock

Box 7 Projects advancing ammonia use in the shipping sector

Box 8 Nitrogen as feedstock for ammonia fuel

Box 9 Wind propulsion technology

Box 10 Uncertainties in the shipping sector

ABBREVIATIONS

a.a.g.r. Average annual growth rate

ATR Autothermal reforming

bbl Barrel of oil

BE Battery-electric

BECCS Bioenergy with carbon capture and storage

BES Base Energy Scenario

CCelsius

CAAP Clean Air Action Plan (United States)

CBG Compressed biogas

CCS Carbon capture and storage

CCUS Carbon capture, utilisation and storage

CI Cold ironing

CII Carbon Intensity Indicator

CMS Carbon molecular sieve

CNG Compressed natural gas

CO2 Carbon dioxide

DAC Direct air capture

DME Dimethyl ether

DMFC Methanol fuel cell

DNV GL Det Norske Veritas Germanischer Lloyd

dwt Deadweight

EE Energy efficiency

EEDI Energy Efficiency Design Index

EEOI Energy Efficiency Operational Indicator

EEXI Energy Efficiency Existing Ship Index

EJ Exajoule

ESPO European Seaports Organisation

EU European Union

FAME Fatty acid methyl ester

FC Fuel cell

FOGs Fats, oils and greases

FT Fischer-Tropsch

gGramme

GDP Gross domestic product

GHG Greenhouse gas

GJ Gigajoule

GMF Global Maritime Forum

GO Guarantees of origin

GT Gross-tonnage

GtZ Getting to Zero

GW Gigawatt

GWP Global warming potential

H2 Hydrogen

HFO Heavy fuel oil

HSFO High-sulphur fuel oil

HVAC Heating, ventilating and air-conditioning

HVO Hydrotreated vegetable oil

ICE Internal combustion engine

ICS International Chamber of Shipping

IEA International Energy Agency

ILUC Indirect land-use change

IMF International Monetary Fund

IMO International Maritime Organization

IPCC Intergovernmental Panel on Climate Change

IRENA International Renewable Energy Agency

IWSA International Windship Association

J-ENG Japan Engine Corporation

JIT Just-in-time

kg Kilogramme

KPI Key performance indicator

kt Kilotonne

lLitre

LBG Liquefied biogas

LNG Liquefied natural gas

LPG Liquefied petroleum gas

LS Large ships

LSFO Low-sulphur fuel oil

m³ Cubic metres

MARPOL The International Convention for the Prevention of Pollution from Ships

MCFC Molten carbonate fuel cell

MDO Marine diesel oil

MGO Marine gas oil

MI Mission Innovation

MJ Megajoule

MS Medium ships

Mt Million tonnes

MTBE Methyl tert-butyl ether

MW Megawatt

MWh Megawatt hour

NG Natural gas

NGO Non-governmental organisation

NOx Nitrogen oxide

O&G Oil and gas

O2 Oxygen

OBOR One Belt One Road

OECD Organisation for Economic Co-operation and Development

PEMFC Proton exchange membrane fuel cell

PES Planned Energy Scenario

PSA Pressure swing adsorption

PV Photovoltaic

R&D Research and development

REmap Renewable Energy Roadmap

RCP Representative Concentration Pathway

RPM Revolution per minute

SEEMP Ship Energy Efficiency Management Plan

SFC Specific fuel consumption

SMR Steam methane reforming

SOFC Solid oxide fuel cell

SOx Sulphur oxide

SS Small ships

SSP Shared Socioeconomic Pathway

T&D Transmission and distribution

TAME Methyl tert-amyl ether

TES Transforming Energy Scenario

TEU Twenty-foot equivalent unit

UNCTAD United Nations Conference on Trade and Development

UNFCCC United Nations Framework Convention on Climate Change

USD United States dollar

VLS Very large ships

VLSFO Very low-sulphur fuel oil

SUMMARY FOR POLICY MAKERS

Urgent action is necessary to accelerate the pace of the global energy transition and the decarbonisation of the global economy. Green hydrogen-based fuels set to be the backbone for the sector’s decarbonisation.

The International Maritime Organization’s (IMO’s) Fourth GHG study 2020 reported that in 2018 global shipping energy demand accounted for nearly 11 exajoules (EJ), resulting in around 1 billion tonnes of carbon dioxide (CO2) (international shipping and domestic navigation) and 3% of annual global greenhouse gas (GHG) emissions on a CO2-equivalent basis. Fossil fuels. i.e. heavy fuel oil (HFO), marine gas oil (MGO), very low-sulphur fuel oil (VLSFO) and, more recently on a small scale, the use of liquefied natural gas (LNG) currently provide up to 99% of the sector’s final energy demand.

International shipping enables 80-90% of global trade and comprises about 70% of global shipping energy emissions. If the international shipping sector were a country, it would be the sixth or seventh-largest CO2 emitter, comparable to Germany. Yet, international shipping emissions fall outside national GHG emission accounting frameworks.

In this context, this report by the International Renewable Energy Agency (IRENA) explores the options and actions needed to progress towards a decarbonised maritime shipping sector by 2050 and seeks to identify a realistic mitigation pathway consistent with a wider societal goal of limiting global temperature rise to 1.5°C (degrees Celsius) and bringing CO2 emissions closer to net zero by mid-century. The report discusses:

IRENA key partnerships contributing to decarbonise the shipping sector

Global Maritime Forum (GMF)

Following