Disclaimer: The answers below from Chris Chatterton, chief operating officer, is point of view of the Methanol Institute, not DNV GL.
DNV GL: How do you track global sales of methanol for shipping?
Chris Chatterton (CC), chief operating officer at the Methanol Institute: The use of methanol has been around for some time, however its application to shipping only started five years ago with the conversion of RoPax ferry Stena Germanica. Methanol as shipping fuel has attracted some interest within the shipping community. Several shipowners have expressed an interest to invest in methanol fuelled vessels. We have also seen similar interest from shipyards and fuel suppliers.
However, the industry is waiting for the final regulatory framework to be in place before committing large scale investments. The IMO interim guidelines have been drafted and it is expected to be fully approved in due course for adoption into the IGF Code. Methanol fuelled ships have already been built - including some classed by DNV GL - to equivalent standards using the technology so the flag and class community understands it is safe and practical.
We do not really track the global sales, but we track technology companies producing renewable methanol. Currently, no premium is paid on renewable methanol, but it may soon come. We are also working on combining fuel cells and methanol as a hydrogen carrier. This has already been introduced to the automobile and truck market - but the marine industry is waiting on developments in IMO.
DNV GL: We were the first to publish class rules on low flashpoint liquid fuel which also cover methanol. A key concern of methanol is that it is toxic. Shipowners need assurance that it may be safely handled onboard the ship and during bunkering. How is the development in this area?
CC: Previously, the charge of toxicity was used to oppose the development of methanol. In fact, methanol is one of the top five seaborne chemical commodities that has been safely handled for more than 50 years. Methanol is no more poisonous than diesel or gasoline, is miscible in water and less hazardous to the environment than diesel or heavy fuel oil, biodegrading rapidly in the event of a spill.
In terms of its potential effect on people in an industrial setting, methanol is quite safe. MI works with Oslo University Hospital and Doctors Without Borders on multiple initiatives on a global basis to provide solutions for methanol poisoning, as a result of bootleg, or illicit alcohol.
We have seen over these years that the loading and unloading methanol as cargo is uncomplicated certainly when compared to ammonia, that has higher safety concerns. Regulatory frameworks for methanol use onboard ships are being established.
Methanol is a liquid fuel at ambient temperature so bunkering of methanol is very much like bunkering distillate fuel.
DNV GL: Ships do not typically call ports specifically for bunkering. Sometimes, they are diverted to a bunker port due to for instance unavailability of compliant fuels. Will methanol be available when needed? Does infrastructure exist?
CC: Methanol has for decades been shipped around the world. It is available around the world through the existing infrastructure in more than 100 ports globally, and there is no difficulty in buying methanol for bunkering. Methanol is either available, or within close proximity to many ports. As bunkering of methanol is similar to distillate fuel, very few modifications to the existing bunkering infrastructure is required. There are currently several, global bunkering suppliers and fuel trading platforms interested in providing methanol fuel to ships.
Availability of methanol at scale is key. To be able to supply large fleets, we need more methanol to be produced. To capture 25-30% of the marine market, the production capacity supply would need to ramp up considerably. While this is not necessarily a problem and it has never been an issue historically for the sector to meet demand requirements, that increased capacity would require significant capital expenditure. Perhaps it is even a more opportune time for governments to consider increased support for such investments into renewable fuels, such as methanol.
DNV GL: Do you see some initiatives among the top bunkering ports to prepare offering such fuel to ships?
CC: There are a number of ports around the world that are already looking into providing methanol as bunker fuel. Antwerp, Rotterdam, Singapore, some Chinese ports to name a few. We are currently discussing a small pilot in Singapore with a similar vessel first piloted in Gothenburg, which would bunker methanol. Again, our biggest concern is overall availability of both conventional and renewable/bio methanol and consequently this is a top priority for our organisation.
DNV GL: Under the identified IMO’s “levels of ambition”, the initial strategy envisages for the first time a reduction in total GHG emissions from international shipping which, it says, should peak as soon as possible and to reduce the total annual GHG emissions by at least 50% by 2050 compared to 2008, while, at the same time, pursuing efforts towards phasing them out entirely. Given the 25+ lifespan of a vessel, many owners are looking for solutions to meet the IMO 2050 ambition. Ammonia is often compared to methanol as the next promising fuel. What is your view on this?
CC: Ammonia, bio-methane and hydrogen are most often heard of in the press, and they definitely have their place. Certain regions are more adapted to take on these fuels, but the requirements on the logistics around these alternatives are higher than for methanol. Consequently, these projects tend to be challenging in terms of investment required.
They may certainly be solutions for the longer term, maybe closer towards 2050, but less so to reach the shorter term targets. Aside from logistics (as all are cryogenic fuels except methanol) the cost of hydrogen or ammonia for example, is currently prohibiting market development and this trend most likely will continue for the next decade. The cost of hydrogen is likely three times greater than methanol, and ammonia is twice the cost, on an “all in” basis.
Methanol has lower carbon emissions when used as fuel –less than conventional fuel oil but is not a totally carbon-free fuel. If more can be produced from renewable sources, methanol has the potential to significantly reduce the life cycle of GHG emissions on land and at sea. Longer term, renewable methanol could potentially provide a solution to comply with future IMO emission regulations without additional investment from shipowners.
For this, transitional technologies are key. Given that production and availability of both hydrogen and ammonia are increasing, Methanol can support an efficient transition, leading towards renewable Methanol and into zero or net-zero carbon solutions.