‘We see a chicken-and-egg scenario with regards to the sourcing of green fuels’

Kristian Mogensen, Two-Stroke Promotion & Customer Support, MAN Energy Solutions, in an exclusive interview with Future Fuels magazine explains what solutions MAN is offering to ship owners in the pursuit to energy transition.

What is the engine technical solutions MAN Energy Solutions offers to ship owners for green fuel transition?

Currently we offer several such solutions. Some will serve the first stage of the energy transition such as LPG- and LNG-fuelled engines, which reduce CO2 by 15-25% depending on the fuel employed.  Beside these LPG- and LNG-fuelled engines, we have – since 2016 – had a methanol engine in service. Methanol is very interesting in light of the green fuel-transition since it is a very relevant power-to-x candidate. Green methanol combines an ease of use with carbon neutrality, making it an attractive way to achieve decarbonisation goals for shipping companies and enabling shipowners and charters alike to offer carbon-neutral supply chains. A little further down the road, in 2024, we will be ready with our ammonia engine. Chemically, ammonia does not contain carbon and, for this reason, it will enable close-to-CO2-free vessel propulsion. Regardless of the engine technology used, a minor amount of pilot fuel is required in order to control the combustion process. In this regard, the pilot fuel could be a BIO-fuel grade with which we have decades of experience.

What are the main challenges in the transition to zero carbon – and what solutions have caught your attention?

The shipping industry is a fragmented market with different types of players comprising first movers, fast followers, and the rest. From our viewpoint, we can confidently say that the market has decided to initiate the green energy transition. As of today in 2022, more that 54% of all orders for MAN B&W two-stroke engines are for dual-fuel engines and we expect that, by 2030, this will increase to 70%. This clearly indicates that the transition has begun. We also see a chicken-and-egg scenario with regards to the sourcing of green fuels, which is the main challenge to the transition. In order to accelerate this, fuels that are either CO2-neutral or carbon-free need to be available and suitable bunkering facilities established for the shipping sector.

Building vessels and green-fuel infrastructure are both huge investments and it’s here that we have seen some hesitation from both sides. However, lately, this situation has begun to change and we have seen, for example, Maersk, CMA CGM and other, important shipping companies take some bold decisions and order vessels with green-fuel engine technology, which in turn paves the way for investments in green-fuel infrastructure.

Which future fuel has the potential to be viable both in terms of supply and demand terms?

Referring to the prior question regarding the main challenges in the energy transition, we see that the balance of supply and demand is one of them. Needless to say, both consumers and suppliers of green fuels need to make a viable business case – owners need to ensure that there is going to be green fuel for their vessels while suppliers need to know that there are customers for the green fuel they are producing. In this regard, we are currently seeing a change in approach and a common understanding from both vessel owners and fuel producers that green fuels – either methanol or ammonia – are an unavoidable element of the green transition that the shipping sector needs to undergo. Today, we see initiatives and commitments by both green-fuel infrastructure producers and ship owners, and are even seeing efforts by market players toward being first-movers.  

Most of the bulk carriers in shipping are two stoke engines today. What options can MAN offer for the bulk vessels for the green transition?

We have seen a continual change in the propulsion trend of bulk carriers. However, lately, with the implementation of EEXI phases 1 and 2, we have seen even more, fundamental changes. With EEDI phase 2, which demanded a 20% decrease in CO2 per transported goods, we saw several new bulk carriers with our LNG-fuelled ME-GI engines – hence, this engine technology provides an up to 25% reduction in CO2 compared to conventional fuel. Further down the road, we expect to see a big population of bulk carriers with our methanol engine since we are already experiencing huge interest in this technology from the bulk carrier segment today. Methanol is attractive and has the ability to provide close-to-CO2-neutral propulsion as bio-methanol or when produced through electrolysis. Furthermore, the additional cost of supplying a methanol engine, tanks and supply system comes with a cost-up of just 10-15% in vessel CAPEX. Besides methanol, we are also seeing great interest from bulk-carrier owners in our ammonia engine. The first commercial ammonia engine will be an S60, which will be appropriate for bulkers in the Kamsarmax to Newcastlemax range.

While it’s still early days in fuel transition, do you foresee a single solution for all vessel types, or do you expect a variety of solutions to emerge? We do not see one single fuel as the definitive future fuel, rather we expect to see a variety of fuels in the market. By 2050, we expect conventional fuels, ammonia and methanol to be predominant. This is for several reasons, one being that it’s unfortunately unlikely that ammonia and methanol will be as widely available in 2050 as conventional fuel is today.

Tags: Engine, Green Ammonia, Green fuels, Green Hydrogen, Kristian Mogessen, LNG, MAN energy Solutions, Methanol