Singapore, Rotterdam advance 'green' shipping corridor

  • Spanish Market: Biofuels, E-fuels, Freight, Hydrogen, Oil products
  • 15/04/24

The Singapore-Rotterdam Green and Digital Shipping Corridor (GDSC) is accelerating its decarbonisation efforts with new partners, and is advancing initiatives to encourage the uptake of sustainable marine fuels.

The world's two largest marine fuel hubs established the Singapore-Rotterdam GDSC in August 2022, in a push for maritime decarbonisation and digitalisation between the ports.

There are 26 global value-chain partners in the GDSC initiative including fuel suppliers, shipping lines, knowledge partners and financial entities. German container shipping line Hapag-Lloyd is the latest partner in the Singapore-Rotterdam trade lane, committing to operate large container vessels on zero and near-zero carbon emission fuels. Hapag-Lloyd is the world's fifth-largest liner shipping firmwith at least 260 ocean-going vessels, according to the Maritime and Port Authority of Singapore (MPA).

GDSC working groups will also pilot the uptake of sustainable marine fuels — like bio-methane, methanol, ammonia, and hydrogen — and test out commercial structures to reduce cost barriers in switching to alternative fuels.

This includes a bio-methane working group that is studying regulations and standards to support adopting the fuel for marine bunkering on a commercial scale. GDSC partners also plan to carry out bio-LNG bunkering pilots over 2024-25, based on a mass balancing chain of custody principle. A methanol working group is working on fuel standards and knowledge exchange, in addition to addressing common challenges to carry out commercial methanol bunkering at Singapore and Rotterdam. And an ammonia working group is developing a framework to assess the lifecycle greenhouse gas intensity of green ammonia for bunkering, to be completed by 2025.

Improvements to digitalisation have also been made as part of the GDSC initiative, with Singapore and Rotterdam successfully piloting an exchange of port-to-port data. Both ports will be able to exchange vessel arrival and departure times for port planning, and ships travelling between Singapore and Rotterdam can also optimise their port call voyage.

The maritime sector is pushing towards a more resilient and efficient energy transition, and participants have pointed out that collaboration between countries and stakeholders would be key to green shipping corridors.

The GDSC is a "very valuable collaboration in accelerating the twin transition: the integration of digital innovation in energy transition efforts," said chief executive officer of Port of Rotterdam Authority (PoR), Boudewijn Siemons. "Not only are we seeing the first results in standardization and data sharing for Port Call Optimization but also the first steps in moving towards operationalization of zero and low carbon fuels on this trade lane."

Progress on the GDSC development also reflects that "public-private collaboration across global value chains can be achieved," said MPA chief executive Teo Eng Dih.


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10/05/24

Mexican power outages enter fourth day

Mexican power outages enter fourth day

Mexico City, 10 May (Argus) — Mexican power grid operator Cenace issued its fourth consecutive day of operating alerts amid the heatwave gripping the country. Net electricity demand reached 47,321MW early today, with deployed electricity capacity slightly below at 47,233 MW, according to Cenace. Since 7 May, Cenace has declared emergency operating alerts as demand exceeded generation capacity during peak evening hours, prompting the grid operator to preemptively cut electricity supply across different states to maintain grid integrity. Power outages have lasted up to several hours in Mexico City and in major industrial states as power demand has outstripped supply by up to 1,000MW. Peak demand this week hit 49,000MW, just below last year's historic peak of 53,000MW during atypical temperatures in June. "We are very concerned about the unprecedented outages detected across 21 states, a situation that affects the normal functioning of Mexican companies," national business chamber Coparmex said. Peak electricity demand typically rises in June-July but temperatures this week have risen as high as 48°C (118° F) across some states. Mexico City reported a record high of 34.3°C on 9 May and high temperatures are forecast to continue into next week, Mexico's national weather service said. The inability of Mexico's grid to respond to increased demand is because of insufficient power generation capacity, non-profit think-tank the Mexican institute for competitiveness (Imco) said this week. "Despite the energy ministry's forecast that 22,000MW of new power capacity would enter service by 2026, only 1,483MW had entered service as of 2022" since late 2018, Imco said. President Andres Manuel Lopez Obrador's administration pledged to build new generation capacity, including five gas-fired, combined-cycle plants, but recognized this week that delays had contributed to the power outages. "We have an electricity generation deficit because some of the combined-cycle plants were delayed, but we are working on it and it will soon be resolved," Lopez Obrador said on 9 May. Lopez Obrador's government has also curtailed private sector power development during his administration. Mexico needs to upgrade and expand its transmission network, industry associations say. "In order to resolve this problem, we believe that a reopening of the electricity market to the private sector is imperative," Mexico's wind energy association, Amdee, said. Mexico has 87,130MW of installed capacity, with 39.5pc from combined-cycle gas-fired power plants and 31pc in renewable power, including wind, solar, hydroelectric, geothermal and biomass, according to the latest statistics from the energy ministry. By Rebecca Conan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Brazil reports more off-spec biodiesel March-April


10/05/24
10/05/24

Brazil reports more off-spec biodiesel March-April

Sao Paulo, 10 May (Argus) — The rate of Brazilian biodiesel falling below required blending limits nearly tripled in March and April after the mandate was increased to 14pc, according to a government analysis. Hydrocarbons regulator ANP's Fuel Quality Monitoring Program (PMQC) found 271 instances of biodiesel below the required level between 1 March — when the blending mandate was increased from 12pc to 14pc — and 30 April. In January and February the PMQC found 97 instances of blends that did not meet the 12pc level. An increase in missed blending targets is common during transitions to higher blending levels, according to the agency, mainly due to difficulties in depleting inventories of the lower-level blend. Several plants claim that a slowdown in biodiesel withdrawals in the first four months of the year also contributed to challenges in complying with the new blending level. Some retailers' loss of market share has also been cited as an aggravating factor. In March, 154 recorded instances of non-compliance covered blending levels between 12.3pc and 13.9pc, according to ANP data. In April, there were 101 occurrences within the 12.3pc and 13.9pc range. Another eight instances of non-compliance were also recorded in each of March and April. The PMQC is a monitoring program and does not have the same effect on market behavior as inspections, according to ANP. "It is used as one of the intelligence vectors for the planning of ANP's inspection actions," the agency said. Only irregularities identified in the context of inspectios can result in fines levied against fuel distributors. By Alexandre Melo Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

California fuel retailers fear regulatory scrutiny


10/05/24
10/05/24

California fuel retailers fear regulatory scrutiny

Houston, 10 May (Argus) — US fuel retailers like neither the regulatory precedent being set in California nor how the transition to renewable fuels is being managed, but companies sticking it out in the Golden State may reap rewards. California governor Gavin Newsom (D) in March last year signed SB X1-2 into law, allowing the California Energy Commission (CEC) to gather a broad range of profit data from refiners and set a maximum gross gasoline refining margin in an effort to avoid price spikes at the pump. "Unfortunately in California there is no shortage of bad policies that are being proposed," California Fuels and Convenience Alliance director Alessandra Magnasco said this week in a legislative affairs meeting at fuel retailer trade association SIGMA's conference in Austin, Texas. She worries that if CEC fails to make progress in capping margins at the refiner level, they will look further downstream and regulate retailers. The alliance is opposed to what it sees as burdensome reporting requirements mandated by SBX 1-2 that were rushed through the legislature. "They are doing it in a way to leave out industry," Magnasco said. The CEC this week approved further reporting requirements for refiners in the state, mandating they file maintenance schedules with the commission at least 120 days in advance of planned work and within two business days after the start of unplanned shutdowns. "Every bad idea we face has generally been socialized in California first," David Fialkov, vice president of government affairs for US fuel retailer trade association NATSO, said during the SIGMA session. The increased adoption of renewable diesel in California is also causing headaches for fuel supply managers. "I can't even tell my customers which specific terminal might have traditional diesel versus renewable or if they're going to have both," said Deborah Neal, director of price risk management for fuel supplier World Kinect during another SIGMA panel discussion. The introduction of renewable diesel to the California market was done without a specific time line or transition plan, Neal said. "It's messy to say the least." The regulatory environment in California has also dampened appetite for mergers and acquisition activity in the eyes of bankers doing the deals. Gas station buyers who are looking to consolidate smaller assets are not looking at California if they are not already invested there, Matrix Capital Markets' co-head of downstream energy investment banking Cedric Fortemps said at SIGMA. "The operating and legal dynamics are completely different than other parts of the country," Fortemps said. But for companies already operating in California, there is limited out-of-state competition and high barriers to entry. Those companies are keen to grow their existing operations, Fortemps said. By Nathan Risser Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Lack of infrastructure to hamper VLAC development


10/05/24
10/05/24

Lack of infrastructure to hamper VLAC development

London, 10 May (Argus) — Development of a very large ammonia carrier (VLAC) market could be delayed by a lack of terminal infrastructure to allow discharge of 40,000-60,000t cargoes, said Steem1960 ammonia shipbroker Lisa Maria Assmann at the Argus Clean Ammonia conference in Tokyo. Around 40 VLACs are scheduled to hit the water between 2026 and 2028, when an uptake in clean ammonia trade is likely to be pushed by public tenders from South Korea and Japan. "VLACs cannot discharge these large volumes using the existing infrastructure," Assmann said. "We have storages that are much smaller than that, terminals with draft issues, LOA (length overall) issues. With all these problems, I do not see these large volumes being discharged in a speedy manner in the short-term, not before 2035-40 at least." In the larger segment of gas carriers, the very large gas carriers (VLGCs) built between 2009 and 2022 cannot carry ammonia cargoes, according to the shipbroker. These vessels were built when there were no expectations of carrying ammonia at such volumes, and the capability was not included to save costs at that time. "By 2030 we may have about 150 VLGCs available to carry ammonia, either at 86pc or 95pc capacity, but that is still a discussion for the future because we still do not have the infrastructure in place for the discharge," Asmann said. Ship-to-ship transfers from larger to smaller vessels could be a solution in the medium term, Assmann said, but she pondered that even then there are regulation issues that would hamper its widespread use. By Yohanna Pinheiro Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Japan Airport Terminal, Euglena eye SAF supply chain


10/05/24
10/05/24

Japan Airport Terminal, Euglena eye SAF supply chain

Tokyo, 10 May (Argus) — Japan's biofuel producer Euglena and airport operator Japan Airport Terminal (JAT) plan to explore commercial delivery of sustainable aviation fuel (SAF) to aircrafts at Haneda airport in Tokyo. Euglena and Japan Airport Terminal signed an initial agreement on 8 May to build a commercial SAF supply chain at Haneda airport, aiming to ship up to 50,000 kilolitre (kl)/yr. This will account for 23pc of the 220,000 kl/yr SAF that Haneda airport will require in the future to attain Japan's 2030 SAF supply goal. Japan aims to replace 10pc of conventional aviation fuel consumption with SAF within the country by 2030. Euglena plans to procure SAF from its 12,500 b/d biorefinery in Malaysia that is expected to begin commercial operations in 2025. Euglena has co-operated with Malaysian state-owned energy firm Petronas and Italian energy firm Eni to build the plant. Euglena also issued its first ¥1bn ($6.4mn) green bond to Japan Airport Terminal for building the commercial biofuel manufacturing plant. Euglena is a producer of biofuel called Susteo, which contains used cooking oil (UCO) as well as euglena oils and fats extracted from microalgae as raw materials. Susteo generates CO2 during the fuel combustion stage but the plants, which are the raw material for UCO, and euglena microalgae absorb CO2 during photosynthesis as they grow. The company in 2022 provided Susteo to government aircraft . Japan's SAF demand is estimated to reach 1.7mn kl/yr by 2030, comprising 880,000kl for domestic flights and 830,000kl for international flights, according to the ministry of land, infrastructure and transportation. By Nanami Oki Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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