GCMD-Led Consortium Commits US$18 Million to Establish Green Marine Fuels Supply Chain Integrity
The Global Center for Maritime Decarbonization (GCMD) is leading a consortium of 18 industry partners to launch a biofuels pilot project with a combined contribution of $18 million in cash and in-kind to establish an insurance framework to ensure the supply chain integrity of current and future green marine fuels, delivering real benefits to end users and the climate.
To achieve the 2030 and 2050 decarbonization targets of the International Maritime Organization (IMO), shipowners as well as shipowners and charterers are exploring the purchase and use of green fuels. Biofuels can be a short-term measure to reduce GHG emissions as they are available today, and they can be deployed in the same way as marine fuels with minimal changes to existing distribution infrastructure, on-board technologies and ship operational standards. However, there is no industry-wide assurance framework that addresses concerns about the quantity, quality, and GHG emission reductions of biofuels, nor that preserves their premium and value. To address this gap, the pilot project led by GCMD aims to establish an assurance framework that guarantees transparency in the supply chain of alternative biofuels, the applicability of which can be extended to future alternative fuels, such as bio-LNG, bio-methanol and green fuels. ammonia, when they become available in significant quantities.
Recent IMO decisions to eliminate the need to apply for exemptions for the use of fuel blends containing up to 30% biofuels (B30) for propulsion and to allow the use of B30 in accordance with the Annex VI of MARPOL have lowered regulatory barriers to the adoption of biofuels. To this end, the assurance framework that will be the result of this pilot project will increase stakeholder confidence in the total value of the premium paid for these green fuels, and further lower the barrier to wider adoption of biofuels in marine industry by addressing concerns about the integrity of the biofuels supply chain.
The vessels in this pilot project are all equipped with two-stroke engines from MAN ES.
GCMD is taking a bottom-up approach by convening like-minded partners across the maritime industry to participate in this pilot project. In total, shipowners, charterers and operators participating in this pilot project represent approximately 2,300 vessels in the container, tanker and bulk carrier segments, and are responsible for transporting 8.4 million TEUs or 80, 6 million dwt worldwide. With 12 vessels calling at three ports on three continents, lessons learned from these route-based pilots will support the Green Corridors Framework that was presented by the Clydebank Declaration at COP26 in October 2021, to which 24 states are signatories. , including Singapore and the Netherlands. and the United States where the bunker ports reside for this pilot project.
The first of its kind in terms of scope and complexity, the pilot aims to optimize the entire bunker fuel supply chain based on lessons learned from onboard trials involving biofuels. Designed through the lens of the shipowner, piloting will begin with fuel blends involving existing biofuels, such as hydrotreated vegetable oil (HVO) and fatty acid methyl esters (FAME) blended with fuel oil Very Low Sulfur Fuel (VLSFO), High Sulfur Fuel (HSFO) or Marine Gas Oil (MGO) in blends of up to 30% biofuel (B30).
Using BunkerTrace’s digital and synthetic DNA tracing products to track marine fuels from production to vessel propulsion, the pilot will validate the authenticity of sustainable biofuels through molecular verification tests performed on fuel samples which are collected at many identified points along the supply chain. Therefore, the pilot project will address the traceability of instant biofuels from production, distribution, transport, storage and bunkering to application on board ships, providing end-to-end transparency of the supply chain. supply.
Testing laboratories will play a crucial role in the evaluation of biofuels and biofuel blends. Strategically located in Singapore, the world’s largest bunker hub and second largest container port, GCMD also participates in the work of the Chemical Standards Committee (CSC) of the Standards Council of Singapore in developing national standards for bunkering. bunkering industry. On this GCMD pilot, Capt.
The complexity of the pilot is added to the coordination of the navigation schedules of the participating ships. Aggregating the demand for biofuels in ports will result in cost savings for shipowners and fuel purchases through optimized use of shoreside storage facilities and bunker vessels and will facilitate assessments of fuel reduction. GHG emissions on a well to wake basis from individual vessels and across fleets. In addition, testing these fuel blends on the container, tanker and bulk carrier segments traveling on fixed routes and tramp and bunker in the ports of Singapore, Rotterdam and Houston under normal conditions will demonstrate the compatibility and stability of these biofuels under real conditions. operating environments, thereby enhancing the overall robustness of the assurance framework.
In an effort to further accelerate the adoption of biofuels as a near-term measure to reduce GHG emissions, GCMD will leverage this project to be the first to test and evaluate the use of crude algal oil (CAO) as marine fuel. CAO is a third-generation biofuel that promises a significantly reduced carbon footprint, but unlike HVO and FAME, its usefulness has not been tested nor its supply chain established.
In preparation for the launch of this pilot project, GCMD is finalizing the details of the agreement with the 18 project partners. The pilot project will start on August 1, 2022 and is expected to last 12 to 18 months. A list of GCMD partners for this project can be found in Appendix A.
About the Global Center for Maritime Decarbonization
The Global Center for Maritime Decarbonization (GCMD) was established on August 1, 2021 as a non-profit organization with an initial investment of S$120 million from the Maritime and Port Authority of Singapore (MPA ) and six founding partners, namely BHP, BW Group, Eastern Pacific Shipping, Foundation Det Norske Veritas, Ocean Network Express and Sembcorp Marine.
Strategically located in Singapore, the world’s largest bunker hub and second largest container port, GCMD aims to help the maritime industry eliminate GHG emissions by setting standards, deploying solutions, funding projects and fostering collaboration across sectors.