Only a few years ago, many in the industry considered carbon capture to be an unknown, unproven technology that was unlikely to play any role in meeting the IMO 2030 and IMO 2050 targets.
Today, on-board carbon capture systems are a commercial reality with the likes of BG Freight Line, X-Press Feeders, and JR Shipping this year having all said they will install capture units onboard their vessels. The technology already looks likely to play an important role as part of the maritime decarbonization journey.
Indeed, as part of this week's 79th meeting of the Marine Environment Protection Committee (MEPC 79), the International Maritime Organization (IMO) is set to discuss what role Carbon Capture can play in meeting the IMO 2030 and IMO 2050 decarbonization targets.
But on-board carbon capture is only part of the story, and the industry can now start to look at what role direct air capture (DAC) of carbon can play in meeting the IMO GHG reduction goals.
To better understand the current state of play with DAC, Ship & Bunker spoke to Anna Stukas, the VP of Business Development at Canada-based Carbon Engineering (CE), whose company are one of the leading players looking to make the technology a commercial reality.
"The first commercial project to use CE's technology is under construction today and is targeted to be online around the end of 2024," Stukas told Ship & Bunker.
"We've already seen companies like Shopify lean in and become our first customer. They purchased an initial 10,000 tonnes of carbon capture. Since then, we've brought other customers in including BMO and Thermo Fisher, and excitingly earlier this year it was announced that Airbus had committed to pre-purchase 400,000 tonnes of removals from our partner, 1PointFive - 100,000 tonnes per year for four years - from that first project.
"So what we're seeing is the voluntary market and the aviation market starting to commit to purchasing permanent carbon removal, or durable carbon removal as we call it, in order to support their net zero goals.
"In the long term we see compliance markets driving the bulk of capture demand overall. Examples of that would be the CORSIA scheme in the International Civil Aviation Organization.
"That's why we're so excited to see the next iteration of the IMO GHG strategy come out. We would really welcome seeing both improved Net Zero targets as well as a recognition of the role that carbon removal can play as a decarbonisation pathway for the maritime industry."
Direct Air Capture
DAC has long been seen as an ideal technology to decarbonize in areas where in-situ capture is difficult, or undesirable.
While we are already seeing on-board carbon capture systems, there are still unanswered questions over how that captured carbon is stored and then disposed of.
Direct air carbon capture does not have such barriers as it takes place on land, decoupled from the source of carbon emissions. As such it requires no modifications or otherwise to offset a vessel's emissions.
The disadvantage is that compared to in-situ capture systems, it is considerably more challenging to capture carbon directly from the air than it is from a concentrated source of emissions.
To that end, Carbon Engineering has been developing its technology at facilities located in Squamish, British Columbia, located about an hour north of the Canadian West Coast Port of Vancouver.
Since Ship & Bunker last spoke to CE in 2019, the company has been building out its Squamish location as an Innovation Centre.
"The purpose of our Innovation Centre in Squamish is to form our permanent R&D platform, and to allow us to test the capture process in an integrated manner," says Stukas.
"For example, at the front end of our process we have our air contractors. Inside those we have a material that looks like the inside of a corrugated cardboard box. The way that material is constructed, its geometry, impacts how efficiently you can capture carbon dioxide.
"We've taken out the first geometry we developed and put a new one, and initial tests indicate the new material could produce an approximately 20% improvement in capture efficiency, which could result in further energy and cost savings for commercial facilities. So this is just one example of how the Innovation Center has been instrumental in validating our technology improvements at scale."
In parallel with constructing its Squamish Innovation Center, CE has completed front end engineering on the first commercial scale project to use its DAC technology, which is currently under construction in the Permian Basin in Texas.
Once operational, the plant will be the world's largest DAC plant and is expected to capture up to 500,000 metric tonnes of carbon dioxide per year, with the capability to scale up to 1 million metric tonnes per year.
"We have also started front-end planning and engineering for a second site in the US, targeted for deployment in Kleberg County in Texas," Stukas adds.
"That will be an initial 1 million tonne per year facility that is intended to be replicated into multi million tonnes deployments. So with potentially multiple back facilities, it could be capable of collectively removing up to 30 million tonnes of CO2 per year."
Both of those projects in the US are being deployed by CE partner, Occidental [NYSE: OXY] subsidiary 1PointFive.
Cost & Acceptance
Perhaps the two biggest factors that will determine what role DAC can play in maritime's decarbonization effort are cost and political acceptance.
In terms of cost, back in 2018 CE made headlines when it said the technology had advanced to the point where the price of capturing one tonne of CO2 would be $100-$150 over the 25 year lifetime of a facility.
However, initial costs will be higher than this.
As its first commercial plant nears the 2024 target start date, 1PointFive currently expects early pricing in the range of $400 to $500/tonne captured, lowering to $200 to 250/tonne captured during a middle phase from 2025 through 2030.
The long term target remains a capture cost of $100 to $150/tonne.
In terms of what that would mean for today's oil-based bunker fuel, traditional marine fuel produces about three tonnes of CO2 per tonne of bunkers burned.
To make those bunkers carbon neutral, during 1PointFive's initial phase this would translate to a premium of $1200-$1500 per tonne of fuel, lowering to $600-$750 per tonne of fuel in the middle phase, and $300-$450 per tonne of fuel in the longer term.
At today's cost of around $600/mt for VLSFO, that would mean an initial total cost of carbon-neutral traditional bunkers would be $1800-$2100/mt, lowering to $1200-$1350/mt in the middle phase through 2030, and $900-$1050/mt in the longer term.
While paying $2,000+/mt for bunkers may seem high, this is lower than all three of the leading non-carbon future fuel candidates; green ammonia, green hydrogen, and bio-methanol.
Using the latest data shared with Ship & Bunker by Argus Media from its Alternative Marine Fuel price assessment database that indicates the cost for an amount of alternative fuel that has the equivalent energy to one tonne of VLSFO, using green ammonia costs $2,702, green hydrogen $2,498, and bio-methanol $2,645.
While the early indications are clearly favourable for DAC, readers should keep in mind that the true cost of future marine fuels still an uncertainty, so it remains to be seen how competitive DAC will be as a decarbonization solution for marine.
But even if it is, whether it will be politically acceptable is an entirely separate question.
One of the most common arguments against using carbon capture is that it enables the prolonged use of fossil fuels when the goal is to eliminate them entirely.
NGO and frequent commentator on maritime decarbonization, Transport & Environment (T&E), for example, has said it considers any form of carbon capture to be off the table as part of meeting IMO targets.
But in recent years the wider attitude towards carbon capture has warmed considerably.
Indeed, even Maersk, who has been among the first movers on supporting a wide range of alternative bunker fuels including their pioneering order of methanol-powered tonnage, last month said it is open to use of carbon capture, at least in the short term.
The shifting attitude has in part been driven by industry realization that commercially viable suitable alternative fuels will not be available until some distance into the future. At the same time, there is a need for Shipping to take action on the matter as soon as possible. Indeed, only last week at a key IMO meeting 28 countries spoke in favour of a 2050 net-zero GHG emissions target for shipping.
Additionally, once low-to-zero carbon fuels are available, residual emissions need to be tackled to make their use net zero on a lifecycle basis.
"Over the last few years the world has completely changed in terms of its understanding and appetite for permanent carbon removal to play a role in decarbonizing and helping the world to get to net zero," Stukas told Ship & Bunker.
"For example, even so called zero emission fuels are not actually zero emission. Nothing is perfectly zero emission. Making hydrogen, even if you make green hydrogen using electrolysis of water, still has an emissions footprint - it is not perfectly zero.
"One of the things that we've seen the aviation industry recognize is that carbon removal will be necessary to counterbalance residual emissions. So even if we transition to completely non-fossil fuel, there will still be an emissions footprint to those fuels, and those residual emissions will need to be cleaned up.
"Carbon removal is an absolutely very powerful tool that can permanently counterbalance those residual emissions.
"The other thing that is recognized is that the residual emissions from the aviation sector are expected to be order of magnitude 100 to 150 million tonnes per year. And we can't just snap our fingers in 2049 and have that quantity of removals magically appear. Investment needs to start today.
"So for marine, the ability for direct air carbon capture to play two roles in helping the industry to decarbonize, in terms of permanent carbon removal and to counterbalance residual emissions; the fact you can decouple your point of emission from your point of collection; and there is the ability to make fuels out of atmospheric carbon dioxide; I think this all makes it a compelling option to help reduce emissions in the maritime sector in the near and long term."
IMO's current goals target GHG reductions relative to 2008 levels. As with the IMO 2020 sulfur cap, there has so far been no requirement for specific technologies or fuels to be used to meet those targets.
That said, there were numerous late attempts to push back against the use of scrubber technology for IMO 2020 compliance, something shipowners will no doubt be wary of when looking at technology to meet the IMO 2030 and IMO 2050 targets.
Stukas is among the many who believe it is important for GHG reduction targets to remain technology agnostic.
"One thing I would say is that the zero emission fuels could be overly constraining. What's important is the overall life cycle carbon intensity of the fuel, more so than whether or not that fuel happens to emit carbon at the point of combustion.
"So what we would be particularly excited to see in the maritime sector is an approach that's technology agnostic and focuses on carbon intensity, that focuses on the net zero outcome that you want to see rather than being prescriptive about what type of pathway is going to be needed to get there.
"The pace of innovation is also almost always going to outpace the pace of regulation, and we don't necessarily know exactly what the solution is going to look like. But we do know that it's going to evolve. So I think making sure that we are thoughtful in how we design those regulations so that they stand the test of time, and making them as performance based as possible focusing on the outcome that we're looking for, which is to reduce our overall greenhouse gas emissions, gives us the best flexibility to meet those targets."