In focus: Shipping poised to lead clean fuels uptake as major oil spill spurs calls for offshore drilling ban

In a week that once again reminded us of the devastating effects the use of fossil fuels has on environment – now on full display across the coast of Southern California due to the newest oil spill – the calls to break our addiction on such sources of energy echoed around the world. Shipping industry seems to take notice, as it positions itself to the centre stage of decarbonisation efforts with the latest plans submitted to industry regulators detailing urgent measures for governments if the net-zero goal is to be achieved by 2050.

The week started with a breaking news about a large oil spill off the Southern California coast, causing at least 126,000 gallons of oil to spill into the Pacific Ocean, prompting an urgent response from the U.S. Coast Guard to put the environmental disaster under control.

According to a report by Reuters, the spill was caused by a breach connected to the Elly oil rig – operated by Beta Offshore, a California subsidiary of Houston-based Amplify Energy Corporation – and stretched from the Huntington Beach Pier down to Newport Beach.

This in turn sparked outrage from non-profit ocean conservation organizations, most notably from Oceana, whose representatives called the disaster ‘a legacy of the fossil fuel age’ which created the ‘addiction’ to oil and gas products that needs to be broken by ‘shifting to clean energy’.

“It’s time for President Biden to deliver on his campaign promise to end offshore drilling and we need California’s Senators to ensure this gets done immediately”, said Jacqueline Savitz, chief policy officer at Oceana.

The outcry – by no means the first, and sadly, probably not the last – was directed to the entire global energy supply system, though it mostly resonated with the shipping industry.

Namely, the International Chamber of Shipping (ICS) – which represents 80% of the global shipping industry – submitted plans to the industry’s UN regulator, the International Maritime Organization (IMO), detailing urgent measures which governments must take to help the industry achieve net-zero emissions by 2050.

The industry association is calling for a complete decarbonization of shipping, as opposed to the current goal of reducing the sector’s emissions for 50% by 2050, as it ‘accepts the vital need to accelerate decarbonisation timelines’, pointing out however that the 2050 target will only be plausible if governments take the necessary actions to achieve this.

The shipping industry players seem to be fully in line with such initiatives, as witnessed by Japanese shipping giant Mitsui O.S.K. Lines (MOL) which announced a subsidy from the Ministry of Economy, Trade and Industry (METI) of Japan for the development of a wave energy project in Mauritius.

Part of its natural environmental protection/recovery projects and social contribution activities, MOL will develop the project with Bombora Wave Power, as Mauritius draws up a roadmap to raise percentage of renewable energy to 35% or 40% by 2030.

Another shipping company from Japan, NYK Line, is proposing the use of liquefied natural gas (LNG) fuel as a bridge solution until marine fuels like hydrogen and ammonia can be used for zero-emission ships.

This is already being explored in Europe by Grand Port Maritime de Bordeaux, which inaugurated its water injection dredger (WID) L’Ostrea earlier in the week. With the dual-fuel engines, the dredger will be able to burn LNG or marine diesel oil. Compared to diesel, natural gas emits 25 % less carbon dioxide (CO2), 80 % less nitrogen oxides (NOx), and almost no sulphur dioxide or particulate matter.

Clean fuel like hydrogen, especially when produced from renewable energy sources, is increasingly being characterized as a stepping stone that will ensure successful transition to net-zero future.

Various initiatives have been launched across the world to further explore this clean fuel, with the most recent ones coming from the Americas.

Starting with Uruguay, the country’s state-owned oil and gas company ANCAP has presented a plan for green hydrogen production powered by offshore wind, which could see a tender launched in a couple of years.

Under the new H2U Offshore programme, ANCAP has called for interested parties to submit offers comprising a work plan, outlining the benefits for the country, and detailing on the possible participation of ANCAP.

ANCAP pointed out that Uruguay had great potential to produce green hydrogen, and when taking in consideration the 2020 analysis from the World Bank, which states that Uruguay holds a technical offshore wind potential of 275GW, this might be a welcome and long-overdue decarbonization initiative.

Another hydrogen-related government initiative comes from the United States, which launched its Hydrogen Shot programme whose sole purpose is to drive down the cost of clean hydrogen by 80% within the decade.

In this regard, the U.S. Department of Energy (DOE) announced $8 million investment for nine projects that will complement hydrogen scale-up efforts and support its goal to decrease the cost of clean hydrogen.

In addition to supporting DOE’s Hydrogen Shot initiative, the projects will support the Biden-Harris Administration’s goal of net-zero carbon emissions by 2050.

They will specifically be testing key hydrogen systems, including safety components, and providing real-world data to guide future clean hydrogen deployments in the United States.