For ocean shipping, unlike trucking and railroads, environmental regulation, not fuel costs, will likely drive the use of natural gas and other alternative energy-powered engines. With natural gas prices comparable to the cost of bunker fuel, the ocean shipping industry doesn’t have the same level of impetus as its surface counterparts.
But that doesn’t mean natural gas is off the table, considering the alternative energy could help carriers meet increasingly stringent emissions rules. The next major phase of the International Maritime Organization’s regulation begins on Aug. 1, as ships will have to burn low-sulfur fuel when they are within 200 miles of North American coastline.
The question is whether it’s cheaper for carriers to burn low-sulfur fuel and invest in scrubbing technology, or to avoid producing such emissions entirely by burning natural gas, said Paul Blomerus, senior director of the high horsepower division at Westport Innovations.
An answer isn’t readily available and won’t be for some time, considering large container ships powered by liquefied natural gas are still restrained to blueprints. Expect ocean carriers to keep an eye on LNG-powered vessel development, as IMO rules on emissions get even more stringent starting in 2015 and don’t let up.
Although there isn’t a large LNG-powered container ship in operation, there are plenty of plans and proposals out there. International classification society Bureau Veritas, South Korea’s Daewoo Shipbuilding & Marine Engineering, and CMA CGM say they have created a basic design for LNG-powered container ships, and Japan’s IHI also says it has developed a low-emissions container vessel that can run on LNG.
The catch appears to be the cost. Large LNG-powered container ships are expected to be more expensive to build and have less cargo capacity because of the space needed for the gas tank and equipment. Providing fueling infrastructure at ports also will ratchet up deployment costs.
Until international emissions regulations tighten, LNG engines have a better shot of being adopted by short-sea shipping. As of May, there were 63 LNG-powered vessels on the seas or being built, an increase of 48 vessels from December, according to a survey by research firm Zeus Development. Some European nations, including Norway, have been using LNG-powered vessels for short-haul shipping for decades.
The U.S. is on track to join them, as Wartsila, a Finnish natural gas equipment provider, and Shell Oil have recently partnered to provide LNG for U.S. maritime use. New Orleans-based Harvey Gulf International has orders to build four LNG-powered offshore vessels, and Rolls-Royce is building what it says are the first LNG-powered tugs for Norway’s Bukser og Berging.
Just as LNG-powered trucking found its footing in drayage and regional hauls, LNG will likely have to prove itself on the short routes before pulling thousands of containers.