Japanese shipping firm NYK Line expects use of ammonia-ready LNG-fuelled vessels to increase in the transition to carbon neutrality, especially among customers or charterers looking to reduce emissions as soon as possible.
"Some customers or charterers may hesitate to use [an] LNG-fuelled vessel as it is not zero emissions. On the other hand, [an] ammonia-fuelled vessel has not been developed and it will take more time. Obviously, it cannot be an option to order newbuilds powered by conventional oil," said the senior general manager of NYK Line's green business group Tsutomu Yokoyama.
This has left them with little choice but to move forward with available lower emissions options and some years later switch to zero emissions vessels at minimum costs, Yokoyama said.
NYK Line started developing ammonia-ready LNG-fuelled vessels with Finnish engineering firm Elomatic in September. It is looking to deploy zero emissions vessels by around 2030, prompted by progress in the development of ammonia as a marine fuel.
Zero emissions vessels will require clean fuels like green ammonia, which is produced using hydrogen and renewable energy with no carbon emissions and among the most promising options for decarbonising shipping.
But getting to the ultimate goal of green ammonia is a challenge. Competitive prices, a sufficient supply chain and capacity, technical development and proper regulation are all needed to make green ammonia a commercially viable, scalable and long-term marine fuel option, Yokoyama said.
The implementation cost of such a fuel will also be high at the beginning but should become much lower as the market grows, he added. "For the smooth implementation and transition to such [an] alternative fuel, governmental support [from] both [a] financial and policy perspective is essential."
Japan is targeting 3mn t/yr of ammonia imports for fuel purposes by 2030 and 30mn t/yr by 2050 as part of its measures to achieve carbon neutrality by 2050, although it is unclear if it is targeting blue or green ammonia. Blue ammonia is produced in the same way as conventional ammonia, but with its by-product carbon dioxide captured and stored.
Yokoyama will be speaking on green ammonia as a marine fuel at the Argus Green Ammonia Virtual Conference from 7-9 December. Click here to register for the event.
