Cradle-to-grave study highlights fundamental role of alternative fuels in emissions reduction

The majority of emissions are created during the operational period of a vessel’s life cycle but these can be reduced by approximately 90% through the use of zero- or low-carbon fuels, reveals the industry-first cradle-to-grave study carried out by Lloyd’s Register (LR) and partners to assess environmental impact across the entire life cycle of an LNG carrier.

LR, together with Knutsen, HD Korea Shipbuilding and Offshore Engineering (HD KSOE), and HD Hyundai Heavy Industries (HHI), kicked off the six-month study in June 2023 to measure the carbon emissions generated throughout the entire life cycle of a 174,000 m3 newbuild LNG carrier, from cradle (raw material extraction) to gate (shipbuilding), gate to end-of-life (operation), and end-of-life and to grave (demolition, recycling, and waste disposal). 

According to the study, alternative fuels, green steel, and renewable energy are fundamental to greenhouse gas (GHG) emissions reduction during the life cycle of a vessel.

As explained, the study took into account all emissions (scope 1, 2, and 3) associated with the vessel throughout its life cycle. Scope 1 emissions are the direct emissions created during shipbuilding and operation. Scope 2 emissions are indirect emissions related to energy, water, and steam while scope 3 emissions encompass indirect emissions created both upstream (supply chain) and downstream (distribution chain).

Analysis showed that the majority of emissions are generated in the operational period of a vessel’s life cycle, but that the use of zero- or low-carbon fuels can reduce these emissions by approximately 90%.

Of the overall operations figure, 79% of GHG emissions are generated through ship operations (tank-to-wake), with 21% attributed to mining and transport (well-to-tank) of the fuels, highlighting the significant positive impact of low- or zero-carbon fuels on emissions reduction. 

The study also revealed that GHG emissions during the shipbuilding stage (gate) can be significantly reduced if green steel – steel with low or zero GHG emissions embodied at the manufacturing stage – is introduced into the process. The use of renewable energy could also lead to a GHG emissions reduction of around 60% at the yard level. 

LR Chief Commercial Officer Andy McKeran said: “Lloyd’s Register is delighted to be part of this JDP study, which is an industry first for shipping. The IMO regulations are progressively evolving to encompass the entire value chain and Scope 3 emissions disclosures are gaining traction.

“The methodology created and tested as part of the study will provide a baseline for all life stages of a new construction vessel and serve as a benchmark for comparing the life cycle emissions of other LNG carriers. LR is seeing strong demand for LCA assessment, with leading shipowners keen to identify the most impactful measures to reduce their environmental footprint, and charterers looking to minimise their Scope 3 emissions.” 

Knutsen Director of Newbuilding and Innovation Jarle Østenstad commented: “We are delighted to announce that our collaboration with HDKSOE and LR has yielded significant results in the Life Cycle Assessment (LCA) of the LNG-fuelled LNG carrier. In preparation for the forthcoming EU Corporate Social Responsibility Directive (CSRD), and other similar regulations across the globe, ship owners will be required to produce sustainability reports disclosing their Scope 3 emissions and outline strategies for mitigation. This LCA analysis brings owners one step closer to meeting these requirements.” 

HDKSOE and HHI Senior Managing Director Yong-Hwa Yeo pointed out that, expanding on this study, the company will expand the Life Cycle Assessment to cover all key flagship products, enabling more transparent communication of the environmental impacts of its products with the stakeholders.