Decarbonisation is an expensive problem. File Image / Pixabay
Marine fuels consultancy BLUE Insight has set out the current potential costs for alternative bunker fuels, arguing carbon taxes may be needed to make them more attractive to shipowners.
An MGO price of around $336/mt in Northwest Europe on October 22 can be compared with an ARA price of $1,203/mt for UCOME biodiesel on the same day, Adrian Tolson, director of BLUE Insight, said in a presentation at the Centre for Management Technology alternative fuels webinar on Tuesday. US biodiesel prices are over $1,000/mt, he added.
Fossil LNG can currently be found for around $300/mt in MGO equivalent prices, Tolson said, but bio or synthetic LNG would have a much higher price. And zero-carbon fuels like green hydrogen and green ammonia could cost as much as $1,900/mt and $3,500/mt, respectively.
"The economies of scale will come, but we need to incentivise adoption," Tolson said.
"The industry requires a carbon tax or levy, or an emissions trading scheme, to increase the price of high-GHG-emitting fuels and reduce the price of zero- or low-carbon fuels."
Tolson will be speaking at the IBIA Annual Convention 2020 next week.
The global convention, being held online this year for the first time, will cover three days from November 3.
To register for the convention, click here: https://www.eventora.com/en/events/ibia-annual-convention-2020-going-global.