Opportunities for the UK to kick-start shipping’s transition to zero greenhouse gas emission fuel

Opportunities for the United Kingdom (UK) to Drive Shipping's Transition to Zero Greenhouse Gas Emissions

The United Kingdom, through collaborations with Arup and UMAS, is exploring strategies to kickstart the shipping industry's shift towards zero greenhouse gas (GHG) emission fuels. This initiative aims to highlight the factors influencing the supply strategy for early-mover zero-GHG emission shipping fuels in the UK.

Key Points:

1. Decarbonization Target: The International Maritime Organization (IMO) has set a goal for zero or near-zero GHG emission energy sources to meet between 5% and 10% of the energy used by international shipping by 2030. Meeting this target requires significant infrastructure investments.

2. Uncertainty in Infrastructure Development: There is substantial uncertainty regarding where and how quickly demand for zero-GHG emission fuels will grow, impacting the development of production and supply infrastructure. This uncertainty hinders investment confidence.

3. UK's Role in Early Mover Opportunities: The UK has an opportunity to initiate the transition by leveraging existing assets, supporting energy security, and fostering economic growth. This is particularly relevant for sectors like ports and shipping.

4. Supply and Demand Dynamics: Arup and UMAS have collaborated to analyze supply-demand dynamics for early-mover zero-GHG emission shipping fuels, focusing on ammonia as a case study for fuel distribution in specific UK port areas.

5. Demand Estimation: For the Northeast England and the Solent (including Southampton and Portsmouth), the demand for heavy fuel oil (HFO) equivalent energy is estimated. Decarbonizing 10% of this demand would require approximately 100 kilotonnes of methanol or ammonia.

6. Strategic Routes and Partnerships: The analysis identifies strategic routes and counter-parties for off-take agreements, crucial for developing e-fuel supply chains.

7. Policy Commitments and Economic Opportunities: By initiating this transition, the UK can fulfill policy commitments while realizing economic benefits, emphasizing the importance of collaboration and strategic planning in achieving decarbonization goals.

This initiative underscores the UK's role in pioneering the transition to zero-GHG emission fuels in shipping, highlighting the need for infrastructure development, strategic partnerships, and informed policy-making to meet international decarbonization targets.