Biofuels: the low-hanging fruits ensnared in policy gaps

As the shipping industry seeks to reduce its carbon footprint, biofuels have emerged as a promising solution that can be implemented without significant changes to existing infrastructure.

“Biofuels are actually a low-hanging fruit insofar as infrastructure compatibility is concerned,” said Dr. Sanjay Kuttan, Chief Technology Officer at the Global Center for Maritime Decarbonization during a recent DNV Maritime webinar.

“While infrastructure is not a concern, policy gaps need to be improved to allow for more widespread adoption of biofuels.”

As explained, the challenge with biofuels lies in their heterogeneity. As generation two and three biofuels emerge, made from feedstocks such as cooking oil or horticultural waste from liquid cellulose, the variety of biofuels produced poses a challenge for quality testing.

With the adoption of biofuels potentially hampered by testing challenges, the industry is calling for the establishment of industry-wide standards for quality testing. Despite this hurdle, experts remain confident that biofuels will play a key role in reducing the shipping industry’s carbon footprint in the years to come.

The center is working on a pilot project related to the deployment of biofuels for shipping. The project involves testing different types of biofuels, including fatty acid methyl esters, hydrotreated vegetable oils, and crude algae oil. Several bunkering operations have been conducted, and the project leaders are currently working on a framework for biofuel purchasers that includes traceability technologies for quality, quantity, and carbon abatement assurance. This framework will help provide transparency in the supply chain for biofuels.

The project is targeting completion by the end of the year when a report on the findings is expected to be released. The project is being implemented in cooperation with shipping companies CMA CGM and Anglo-American.

As explained by Kuttan, it is actually an easy pathway to deploy biofuels when compared to ammonia or methanol, and hydrogen. Since 2016, there have been around 20 publically-known trial uses of biofuels by multiple shipping companies.

“We spoke to almost all of them and we’re trying to understand why no more traction,” Kuttan said, recognizing that the supply and demand remain an issue.

The availability of biofuel feedstocks is limited due to competition from other industries, such as agriculture, which can create supply chain challenges for shippers.

That being said, there is a need for a clear demand signal from shipowners for the production and availability of biofuels to be scaled up. And for that certainty in demand to be created the International Maritime Organization (IMO) must create clarity around the role of biofuels in the decarbonization of shipping providing security for shipowners.

However, upon ‘digging deeper’ the project developers found that another issue with regard to the slow adoption of biofuels was the lacking quality assurance that the biofuel purchased was actually ‘green’.

There is also a lack of harmonized global standards. Currently, there is no globally accepted standard or certification for verifying the sustainable production of biofuels. This creates challenges for shippers, who may have to navigate different standards and requirements across different jurisdictions.

In addition, a massive hurdle to overcome within the regulatory space is compatibility with existing regulations. Existing regulations may not take into account the specific characteristics of biofuels, which can differ significantly from traditional fossil fuels. For example, the International Organization for Standardization (ISO) 8217 fuel standard, which is widely used in the marine industry, does not address many of the parameters that are relevant to biofuels.

“The counting thing needs to be sorted out so that everyone’s convinced that they will get some benefits from burning biofuels and with the move towards the next generation of biofuels people are getting less worried about competing with the food chain,” Kuttan added.

There have been some positive developments from last year. Namely, the use of biofuels and blends in vessels has raised concerns over potential increases in nitrogen oxide (NOx) emissions, which is regulated by MARPOL Annex VI.

A new Unified Interpretation (UI) approved by the IMO’s Marine Environment Committee in June 2022 now allows blends containing up to 30% biofuel to be treated the same as fossil fuel oils, without the need for NOx emission assessments or exemptions from Flag State. Additionally, B30 to B100 biofuels can be used in engines certified in accordance with MARPOL Annex VI Regulation 13, as long as there are no changes to NOx critical components or settings.

In conclusion, the viability of biofuels for shipping remains a topic of debate in the shipping industry and among policymakers. While biofuels offer the potential to reduce greenhouse gas emissions and improve the sustainability of the shipping industry, their widespread adoption faces several challenges, including the availability of sufficient feedstocks, scalability, and cost-effectiveness.

Several pilot projects and initiatives are underway to test the viability of biofuels for shipping, and some early results are promising. Nevertheless, it will be crucial for stakeholders to collaborate and invest in research and development to address the remaining challenges and maximize the potential of biofuels.

Furthermore, it is important to note that biofuels alone cannot solve the shipping industry’s sustainability challenges. A comprehensive approach that incorporates various sustainable technologies and practices will be necessary to achieve long-term sustainability goals.

Overall, biofuels have the potential to play a significant role in reducing the shipping industry’s carbon footprint, but their viability will depend on the industry’s ability to address the remaining challenges and make significant investments in sustainable solutions.