7% of EU’s shipping fuels need to be green by 2030 for the sector to decarbonise

7% of the EU’s shipping fuels need to be green by 2030 for the sector to decarbonise by mid-century, a new study released by environmental NGO Transport & Environment (T&E) shows.

The study analyses technical, operational and fuel options that could help cut EU shipping emissions in line with the EU’s economy-wide targets.

Namely, the EU Green Deal requires all emissions regulated in the EU, including those from shipping, to be cut to net-zero by 2050.

T&E said it had built a tailor-made shipping stock model, which takes account of technology review and transport work demand from the 4th IMO GHG study, EU THETIS-MRV database and relevant literature review, in order to identify potential decarbonisation pathways for EU shipping.

The modelling points to a clear path that involves modest deployments of e-fuels combined with efficiency measures such as wind-assist and speed optimisation. 

Three scenarios investigated the impact of different levels of energy efficiency improvements along with an ambitious but sustainable uptake of green e-fuels.

According to the findings of the analysis:

• To contribute its fair-share to the EU’s -55% 2030 target, EU shipping must slash about 90 Mt CO2 emissions by 2030 compared to 2018 emissions. A combination of large energy efficiency improvements and zero-emission enabled vessels (ZEEVs) deployment get the closest to attaining this target but still miss it by 35 Mt CO2/year.
• EU-related shipping could cut up to a third of its emissions in 2050 by simply improving its technical and operational energy efficiency (i.e. fuel economy). This can be achieved by installing energy-saving devices such as wind-assist, but also through operational changes including optimising/reducing operational speed. In general, up to 41% fuel economy (i.e. fuel consumption per transport work) improvements are possible between now and 2030.
• Among the sustainable electro-fuels, green ammonia appears to be the cheapest fuel to decarbonise the EU-related shipping with green liquid hydrogen gradually catching up by 2050.
  However, given the superior energy density and lower storage costs green ammonia is likely to remain the cheapest e-option for ocean-going vessels from the total cost of operation perspective.

 “If EU shipping is to play its part in rapidly cutting global emissions, it should act now. Only a combination of energy efficiency improvements and zero-emission vessels will get us there,” Faig Abbasov, shipping director at T&E, said.

“Our analysis shows that even modest deployments this decade can put a sector resistant to change on the right track. The EU should mandate 7% electrofuel deployment by 2030 for all EU shipping as an ambitious but realistic way to fully decarbonise by 2050.”

Up to a third of emissions could be cut in 2050 through improved efficiency alone. But this will not be enough to decarbonise the sector, said T&E. If the industry is to cut emissions further it will need to transition to e-ammonia and e-hydrogen which are currently the cheapest green fuel options.

The study shows that around 4.6Mt e-ammonia, or 85 PJ, could be feasibly made available for shipping by 2030.

To produce such amounts of green ammonia, Europe would need to install about 14.6 GW of additional renewable electricity and about 7.5 GW of electrolyser capacity by 2030.

Both e-ammonia and e-hydrogen reach up to 7% of the EU shipping fuel mix by 2030 which, the study shows, would give producers the kickstart they need to make enough of the fuels in the coming decades.

In order to consume the supply of e-ammonia, and to create the demand for it, shipping companies would need to start deploying zero-emission enabled vessels from 2025 onward.

The NGO said that it would take, for example, the equivalent of 120 of the largest container ships to consume that amount of e-ammonia (4.6 million tonnes). For comparison, the equivalent of at least 130 new natural gas-powered vessels of the same capacity will be deployed in the next three years alone.

Furthermore, the study estimates that combined energy efficiency and zero-carbon fuel deployments would also save industry up to €12 billion in costs in 2050 to fully decarbonise.

As a result, EU regulations driving both energy efficiency and green carbon-free fuels deployments would deliver 6 times more cost-effective carbon reduction in 2030 and about 2 times more cost-effective carbon reduction in 2050.

As such, the EU should mandate 7% e-fuels by 2030 as part of the forthcoming FuelEU maritime legislation, concludes T&E.