While the debate continues about the environmental
performance of liquified natural gas as a marine fuel and its longer-term
prospects, commissioners from the European Union publicly stated that they
recognize the importance of LNG in helping the shipping industry achieve
Europe’s goals for decarbonization. The acknowledgment came as other lawmakers
in the European Parliament have been pushing for the removal of fossil gasses
from the sanctioned sources of energy.
Speaking at a private conference on green innovations,
Joaquim Nunes de Almeida, director for energy-intensive industries and mobility
with the European Commission’s DG GROW, recognized that LNG is a necessary
energy source as the maritime industry seeks to transition from traditional
fuels to new low or zero-carbon sources of energy. The commissioner told
listeners that supply issues and the need to develop further technologies make
an immediate switch away from traditional fuel sources unrealistic.
“We have to be aware of the constraints in which the
industry is operating right now,” said de Almeida. “Right now the truth of the
matter is that you still have very little renewables and hydrogen or
decarbonized forms of energy available in Europe.” The lack of supply of
advanced biofuels and new energy sources remains a hurdle to requiring the use
of the resources available today.
He went on to say that, “We’re on a difficult journey here,
so we need to have some understanding for the industry that is on the one hand
faced with an increased carbon price and on the other hand with a lack of real
alternatives for the moment,” reports conference organizer EURACTIV.
Other European lawmakers and environmentalists, however,
have been seeking to exclude LNG from the FuelEU maritime legislation based on
fears that it would slow the adoption of developing energy sources such as
batteries, hydrogen, and ammonia, which they believe hold the potential to
reach carbon neutrality in the maritime industry.
The EU’s discussion on the future of LNG comes as other segments
have also weighed in on the marine gas fuel which is currently being adopted by
many ship operators as a near-term strategy to address the push toward
decarbonization. The oil producers’ association OPEC in its newly issued World
Oil Outlook to 2045 anticipates that within the decade demand for conventional
marine fuel will plateau. The report speculates that “It is projected that LNG
usage will expand in marine modern ICEs (internal combustion engines) in the
medium- to long-term. In fact, LNG could become the dominant fuel, especially
for large ocean-going vessels.”
The oil producers in their report, however, also recognize
the environmental debate around LNG and critics who say the methane slip from
the current LNG applications far outweighs the benefits in carbon reduction.
OPEC writes in its report, “Finally, the future of LNG in marine bunkers
remains uncertain for the time being, as some have voiced doubt about its
long-term sustainability in view of CO2 emission reduction targets and have called
for the increasing use of renewable hydrogen or ammonia instead. Consequently,
some orders of LNG-fueled vessels have been canceled amid these concerns.”
No evidence was supplied to confirm order cancelations or
specific instances of shipowners turning away from LNG. However, earlier this
year, the World Bank issued a highly critical report of LNG. The international
financial organization dismissed the long-term role of LNG citing the
environmental concerns instead supporting emerging technologies for ammonia and
hydrogen as the most promising future fuels. They encouraged emerging economies
not to invest in LNG and instead focus on what they believed were the more
promising long-term energy sources.
Industry groups, including SEA-LNG, were quick to respond to
the World Bank saying the organization was misinformed and wrong to advise
against LNG. They cited advancements in the technologies and like the EU director
highlighted the critical near-term role LNG was playing in transitioning the
maritime industry from conventional fuels.