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Maersk throws weight behind renewable methanol as a fuel of the future

Some of the biggest names across the Danish transport spectrum including Maersk are joining forces to produce sustainable fuels for road, maritime and air transport in the Copenhagen area. The news is also notable for Maersk’s determination to pursue renewable methanol as one of its main fuels of the future.

Maersk, the world’s largest containerline, is joined in the new endeavour by Copenhagen Airports, DSV Panalpina, roro operator DFDS, airline SAS and utility firm Ørsted in this first of its kind partnership to develop an industrial-scale production facility to produce sustainable fuels.

“The partnership brings together the demand and supply side of sustainable fuels with a vision to realise what could become one of the world’s largest electrolyser and sustainable fuel production facilities,” the group stated in a release.

The new hydrogen and e-fuel production facility is scheduled to be up and running as soon as 2023. When fully scaled-up by 2030, the project could deliver more than 250,000 tonnes of sustainable fuel for busses, trucks, maritime vessels, and airplanes every year. Production would potentially be based on a total electrolyser capacity of 1.3 gigawatts, which would likely make it one of the world’s largest facilities of its kind.

The project will be located in the Greater Copenhagen Area and aims to supply renewable hydrogen for zero-emission busses tendered by Movia and heavy-duty trucks managed by DSV Panalpina, renewable methanol for Maersk vessels and renewable jet fuel for SAS airplanes and air transport out of Copenhagen Airports. The project will require a large-scale supply of renewable electricity, which could potentially come from offshore wind power produced at Rønne Banke off the island of Bornholm.

“Today, such sustainable fuels come at a higher cost than fossil-based fuels. To become competitive with fossil fuels, the production of sustainable fuels will need to be matured, built at industrial scale, and go through a cost-out journey similar to what has been seen over the past decade in other renewable energy technologies, such as offshore wind, onshore wind and solar PV,” the group states in a release. As an example, the cost of offshore wind has declined by approximately 70% in Northwest Europe since 2012. For this to happen, the partnership said governments and industry must come together to create a framework that incentivises private investments in large-scale sustainable fuel production.

The partnership will now move forward and engage in dialogue with the regulatory authorities on the framework and policies needed to support the development of using sustainable fuels at scale in the transport sector in Denmark, and to seek public co-funding to conduct a full feasibility study of the project. If the feasibility study confirms the viability of the project vision, a final investment decision for the first stage of the project could likely be taken next year.

Søren Skou, CEO of A.P. Moller – Maersk, commented today: “Decarbonising the transport sector is a significant and complex task that requires collaborative contributions from every company, organisation, and country. This project provides a first step in the massive transformation to produce and distribute sustainable energy. In Denmark, we have an opportunity now to accelerate the green transformation and take lead in powering the future with sustainable energy and I am pleased that we can contribute with concrete actions. We need many such projects both in Denmark and around the globe to achieve our ambition in Maersk of becoming carbon neutral by 2050.”

In December 2018, Maersk came out as the first major shipping line to pledge to be carbon neutral by 2050 – an aim that is far ahead of the International Maritime Organization’s 2050 environmental targets.

In October last year the Danish carrier identified three fuels to focus on in its decarbonisation drive, namely renewable methanol, biogas and ammonia.

The renewable methanol pathway identified by Maersk is promising, the carrier stated in a release last year, because it is liquid at normal temperature and there are existing markets, known execution and infrastructure which can be extended. It is also not a highly toxic product.

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Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.

Comments

  1. I don’t understand. Is this article about hydrogen or methanol? Hydrogen is clean, but it takes as much energy to produce as you get by burning it. OK, consider it a big battery. But methanol is a hydrocarbon and produces CO2 when it burns just like other hydrocarbons. The article was unclear where methanol comes into the picture.

  2. Methanol can also consume renewable hydrogen and CO2 during manufacture. Low-carbon or “e” methanol is possible with this route to methanol. As you might imagine costs are great in the short run, although opportunity cost of not using low carbon fuels could be much higher.

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