• 2022 July 26 16:55

    GCMD-led consortium commits US$18M to establish supply chain integrity of green marine fuels

    The Global Centre for Maritime Decarbonisation (GCMD) is leading a consortium of 18 industry partners to launch a drop-in biofuels pilot project with a combined contribution of US$18M in cash and in-kind to establish an assurance framework for ensuring the supply chain integrity of current and future green marine fuels, bringing genuine benefits to end-users and the climate.
     
    To meet the International Maritime Organisation’s (IMO) 2030 and 2050 decarbonisation targets, shipowners as well as cargo owners and charterers are exploring the purchase and use of green fuels. Biofuels can be a near-term measure to reduce GHG emissions as they are available today, and they can be deployed in the same way as marine fuels with minimal changes to the existing distribution infrastructure, shipboard technologies, and operational norms of ships. However, there is no industry-wide assurance framework that addresses concerns on the quantity, quality and GHG emissions abatement of biofuels, nor one that safeguards their premium and value. To address this gap, the GCMD-led pilot aims to establish an assurance framework that ensures supply chain transparency of drop-in biofuels, whose applicability can be extended to future drop-in fuels, such as bio-LNG, bio-methanol and green ammonia, when they become available in meaningful quantities.
     
    Recent IMO decisions to eliminate the need to apply for waivers for using fuel blends with up to 30% biofuels (B30) for propulsion, and to allow the use of B30 in accordance with MARPOL Annex VI, have lowered regulatory hurdles for adopting biofuels. To this end, the assurance framework that will be the outcome of this pilot will increase stakeholder confidence in the full value of the premium paid for such green fuels, and further lower the barrier to wider adoption of biofuels in the maritime industry by addressing concerns on the integrity of the biofuels supply chain.
     
    The vessels in this pilot are all equipped with MAN ES’s two-stroke engines.
     
    GCMD is undertaking a bottom-up approach by convening like-minded partners across the maritime industry to participate in this pilot. Altogether, the ship owners, charterers and operators participating in this pilot project represent approximately 2,300 vessels across the container, tanker and bulker segments, and are responsible for transporting 8.4 million TEUs or 80.6 million DWT globally. With 12 vessels bunkering at three ports across three continents, the learnings from these route-based pilots will support the green corridors framework that was put forth by the Clydebank Declaration at COP26 in October 2021, of which 24 states are signatories­ including Singapore, the Netherlands and the US where bunkering ports for this pilot project reside.
     
    A first-of-its-kind in extent and complexity, the pilot aims to optimise the entire supply chain of bunker fuels by building on the learnings of past shipboard trials involving biofuels. Designed through the lens of the shipowner, piloting will start with fuel blends involving existing biofuels, such as hydrotreated vegetable oil (HVO) and fatty acid methyl esters (FAME) blended with either very low sulphur fuel oil (VLSFO), high-sulphur fuel oil (HSFO) or marine gas oil (MGO) in blends up to 30% biofuels (B30).
     
    Using BunkerTrace’s digital and synthetic DNA tracing products to track marine fuels from production to vessel propulsion, the pilot will validate the authenticity of sustainable biofuels through molecular verification tests conducted on fuel samples that are collected at numerous identified points along the supply chain. Hence, the pilot will address traceability of drop-in biofuels from production, distribution, transportation, storage, and bunkering to shipboard application, providing end-to-end supply chain transparency.
     
    Testing laboratories will play a crucial role in evaluating the biofuels and biofuel blends. Strategically located in Singapore, the world’s largest bunkering hub and second largest container port, GCMD also participates in the work of the Singapore Standards Council’s Chemical Standards Committee (CSC) in developing national standards for the bunkering industry. On this GCMD pilot, Capt.

    Adding to the pilot’s complexity is coordinating the sailing schedules of participating vessels. The aggregation of demand for biofuels at ports will result in cost savings for shipowners and fuel purchases through optimised use of land-side storage facilities and bunkering vessels and facilitate assessments of GHG emissions abatement on a well-to-wake basis of individual vessels and across fleets. Furthermore, testing these fuel blends across the container, tanker and bulker segments travelling on fixed and tramp routes and bunkering at the ports of Singapore, Rotterdam, and Houston under business-as-usual conditions will demonstrate the compatibility and stability of these biofuels in actual operating environments, thereby strengthening the overall robustness of the assurance framework.
     
    In an effort to further accelerate biofuels adoption as a near-term measure to reduce GHG emissions, GCMD will be leveraging this project to be the first in trialling and assessing the use of crude algae oil (CAO) as a marine fuel. CAO is a third-generation biofuel that promises substantially reduced carbon footprint, but unlike HVO and FAME, its utility has not been tested nor its supply chain established.
     
    In the run-up to the launch of this pilot project, GCMD is finalising the agreement details with the 18 project partners. The pilot will commence on 1 August 2022, and is expected to take 12 to 18 months to complete. A list of GCMD partners for this project can be found in Annex A.


    About the Global Centre for Maritime Decarbonisation
    The Global Centre for Maritime Decarbonisation (GCMD) was set up on 1 August 2021 as a non-profit organisation with an initial investment of S$120 million from the Maritime and Port Authority of Singapore (MPA) and six founding partners, namely BHP, BW Group, Eastern Pacific Shipping, Foundation Det Norske Veritas, Ocean Network Express and Sembcorp Marine.

    Strategically located in Singapore, the world’s largest bunkering hub and second largest container port, GCMD aims to help the maritime industry eliminate GHG emissions by shaping standards, deploying solutions, financing projects, and fostering collaboration across sectors.




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