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No biofuel breakthrough yet

21 January 2020

Tankers on biofuels? If shipowners and cargo owners collaborate, share costs and choose the right fuel it could be possible. According to a new study a transition to biofuels may increase transport costs by 40 percent. But cheaper alternatives exist.

There´s some discounts on port and fairway fees to pick up here and there. Not much more. The sums, of course, do not match the long-term costs of a shipping company who decided to run their vessels on biofuels.

“Existing policies do not offer regulatory or systematical support for the introduction of bio-based fuels in shipping”, Hulda Winnes, a researcher at IVL, says.

She had hoped to say something else. One of the aims of the study Biofuels for low-carbon shipping, which IVL conducted in collaboration with Terntank and Lighthouse, was to look at opportunities for a functioning business model. But such solutions were difficult to find and she expects it will take time before biofuels will dominate shipping.
So, what does it take to make it happen? Are more political instruments needed?

“Of course, that could be a strong driving force. Then the same conditions would apply to everyone. Today, everything is based on a voluntary commitment on the part of the shipping companies and cargo owners.”

So why would companies like Terntank, who let two of their tankers be the objects of two case studies with LBG (liquefied biogas) and HBO, invest in this?

“It is a way of influencing the development towards a fossil-free shipping. Terntank shows that it is possible. And it really is. But today only a few companies who have the possibilities to do it.”

And I would not be room for so many more. The study shows that fuel production needs to increase significantly in order to meet any future demand from shipping.

“We looked mainly at LBG and HVO. There are other types of fuels such as FAME that are probably available in larger quantities, but there is a reluctance in the industry to use FAME because of its historically lower qualities - something that is likely to be overcome. The cost increase would be significantly lower if one switched to FAME.”

As a researcher, it's exciting to work with companies like Terntank that have a real desire to change their industry for the better, Hulda Winnes says.

- But as with all environmental issues, the responsibility lies with everyone - legislators, producers and consumers. As a consumer you can start to think about how a product has been transported. Now is the time for consumers to catch their eyes on the transport, because that is also what you buy – not just the product, says Hulda Winnes.

Read the report here

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