Decarbonization Costs Driving Interest in Wind Power Retrofits

Gavin Allwright, IWSA Secretary General, at last week’s wind propulsion and decarbonisation seminar at Port of Vancouver. Image Credit: Ship & Bunker

The future cost of complying with emissions regulations, and the cost of decarbonization in particular, is driving a growing interest in bunker-saving wind power retrofits.

"All of the ships that we're designing and building today are going to be operating at net zero emissions - not a zero emissions ship, but at the end of their life, in say 30 years, we'll be in a position were every single tonne of carbon coming out of that funnel has to be paid for or offset somewhere else in the economy," says Gavin Allwright, Secretary General of the International Windship Association (IWSA) who last week gave a presentation as part of a wind propulsion and decarbonisation seminar at Port of Vancouver.

What the exact cost of this will be remains to be seen, but the signs suggest it will place a heavy burden on the shipping industry.

"There will be a substantial increase in the cost of carbon," says Allwright.

"Sweden has already imposed a €120 per tonne carbon tax - that's €350 to €400 per tonne of fuel. And that's today."

On top of this, shipping also needs to reduce its absolute carbon emission levels in line with the IMO2030 and IMO2050 GHG targets, a challenge industry bodies such as the International Chamber of Shipping (ICS) have already warned means the adoption of radical, costly, and as yet unproven technologies.

One of the strengths of wind power, says Allwright, is it provides savings independent of whatever fuels and technologies win out in the future.

"What will be the fuel in 10 years time? What size of vessel will be needed in 10 years time? What will be the trade routes in 10 years time? We're just not sure," he says.

"What wind does is it helps future-proof your vessel's energy savings. It can reduce the number of bunkerings and help offset the cost of whatever those more expensive future fuels will be, such as hydrogen and ammonia."

As to what savings the various wind power technologies can provide, Allwright says 5-20% is typical but notes some estimate they can be as high as 30% or more.

Uptake

While 2018 saw a number high profile wind power projects, such as the use of rotor sails by Maersk Tankers, there are still many barriers to overcome before it sees any meaningful level of uptake by the commercial fleet.

Key among them is addressing the often incorrect perceptions of using wind power, such as a lack of understanding as to how quickly wind power systems can be adopted.

For example, Allwright says some systems can be installed in as little as six hours, meaning it is perfectly possible to install systems on a vessel for one charterer and then remove them for the next.

Even so, he says the split incentive problem is one of the biggest challenges to overcome - that is, the shipowner makes investment but charterer benefits from the fuel savings - but Allwright says this is slowly becoming less of an issue.

"There are now programmes in place to lease the rig onto the ship and pay for it with the savings. And if a manufacturer promises 20% and delivers 17%, the owner still gets their 10% and the provider takes the 7%," he says.

Of course the most immediate challenge for ship operators is complying with the upcoming global 0.50% sulfur cap.

With some believing the cost of low sulfur fuels next year could be as much as $400/mt higher than the HSFO being burned today, IMO 2020 alone may be enough to push wind power into the mainstream.