Maersk Inexperienced Methanol Plans Will not Decarbonize Methanol A lot

Main transport agency A.P. Moller – Maersk continues to spend money on inexperienced methanol and dual-fuel ships to burn it in. The agency made the selection for inexperienced methanol as its decarbonization technique and is executing. Whereas I feel that inexperienced methanol is merely one of the best of the also-ran alternate options for the house, with batteries and biofuels being the rather more affordable and stronger contenders, I respect their alternative.

However there are nuances of their strategy value contemplating. The information which triggered this was that Maersk did execute on one thing that had been within the works. Studies point out that the agency has purchased half of an Egyptian wind farm supposed to gasoline inexperienced methanol manufacturing subsequent to the Suez Canal.

I first revealed on the Egyptian plans in early 2022, after I was engaged to evaluate European hydrogen initiatives in northern Africa. Egypt is offering important fiscal tax breaks for inexperienced hydrogen, ammonia and methanol initiatives, and house within the Ain Sokhna financial zone beside the canal.

Not way back, Maersk’s first dual-fuel ship slid into the water in South Korea for its lengthy journey to Denmark. Whereas Maersk promoted its use of inexperienced methanol, sourced from biomethane at a U.S. landfill, the presumed transportation of this gasoline over 10,000 km to Ulsan raises questions on its environmental influence. Moreover, the Maersk ship wanted to refuel a number of instances throughout its journey, in Singapore and Egypt, resulting in uncertainties about the kind of gasoline getting used. There have been doubts relating to whether or not the Singaporean tanker, which can have transported the inexperienced methanol, is utilizing unabated methanol with greater CO2e emissions than diesel, or if it’s utilizing diesel itself.

In truth, it’s been revealed that Maerk’s dual-fuel ships, once they run on methanol in any respect, can be impossible to be burning inexperienced methanol instantly, at the least not for a very long time. As a result of very apparent logistical challenges of getting comparatively tiny quantities of inexperienced methanol to numerous ports that don’t have it, Maersk as a substitute is successfully doing what Microsoft does when it buys wind energy lots of of kilometers away from a knowledge middle. It’s utilizing no matter methanol is on the market regionally, and paying for the creation of inexperienced methanol which can be utilized by another finish consumer some place else.

In precept, this is identical as Microsoft’s acquisition of inexperienced electrons, nonetheless, there are some nuances value attending to. Let’s begin with primary methanol for transport. It’s wooden alcohol, which implies it burns cleanly, however non-green methanol is a a lot larger carbon drawback than marine diesel or resid.

Desk of CO2e emissions for diesel, methanol and ammonia as a maritime gasoline

I created this desk some time in the past based mostly on the Methanol Institute’s numbers for carbon emissions in manufacturing of the liquid. The typical of methanols all over the world emit 2.9 instances as a lot greenhouse gasoline as marine diesel does, so clearly that’s not a local weather win.

At current, manufacturing methanol from pure gasoline, coal gasoline, and different gases has a carbon footprint of 500 to 700 million tons of carbon dioxide or equal globally. That’s within the vary of 1-2% of world greenhouse gasoline emissions. It’s an enormous local weather drawback.

The Institute is the worldwide lobbying arm for the business and it actually doesn’t like this actuality and makes positive it by no means does the comparability itself in any paperwork. On the similar time, it’s pushing arduous for methanol to be the ‘low-carbon’ transport gasoline of the long run.

The business has been promoting excessive carbon methanol as a ‘clear burning’ gasoline to the transport business for years and promising that really inexperienced methanol could be the identical worth as marine transport fuels at present. It’s very a lot a bait and swap, and it’s engaged on Maersk and others. Many individuals are underneath the phantasm that inexperienced hydrogen can be low-cost, so Maersk isn’t alone in making this error.

Methanol is already dearer at present than marine fuels, a median of 1.6 instances the price of marine diesel throughout main jurisdictions. Sooner or later, will probably be rather more costly, as like hydrogen it may be inexperienced however received’t be low-cost by both instantly assembling artificial methanol utilizing very nicely understood chemical engineering processes, or manufacturing it from biomethane. It’s more likely to be two to 5 instances the price the truth is, or three to eight instances the price of present maritime transport gasoline.

This too is one thing the Institute actually doesn’t need anybody to know, and Maersk is simply more likely to be starting to know because it indicators contracts for biomethanol and artificial methanol. I strongly suspect the methanol producers supplying it are offering it at or beneath price within the brief time period to get Maersk and others hooked, with the truth of upper costs unveiled solely later. If true, is {that a} authorized enterprise observe? Positive, so long as you aren’t colluding throughout the business to take action or creating a large monopoly by unfair pricing practices. Is it moral? Not a lot. Is it local weather answer? Not likely.

If methanol turns into the marine transport gasoline of the long run, in my projection of vitality necessities for parts that received’t electrify, methanol demand would possible triple to nearer to 500 million tons. In vitality projections which fake that transport will improve considerably and ignore electrification, the methanol demand could be nicely over a billion tons a 12 months. You may see why the methanol business is working so arduous to make this the vitality supply of alternative.

However to be clear, Maersk’s efforts are rather more virtuous than Methanex’ Atlantic crossing by a ship powered by purportedly inexperienced methanol that was truly 96% fossil pure gasoline derived. That was a number of the most egregious greenwashing I’ve seen within the house. However how virtuous is making certain that a few of methanol in circulation is inexperienced?

One upside of Maersk making certain that inexperienced methanol is manufactured is that it’s making a market and enabling efficiencies and economies to be present in deployed websites. We don’t make inexperienced methanol at present as a result of pure and coal gasoline is filth low-cost, so there’s little or no expertise with synthesizing it at an industrial scale or manufacturing it from biomethane, though the latter is rather more aligned with present industrial practices. Maersk placing cash into that’s good as a result of the methanol business globally has to decarbonize to ensure that local weather objectives to be met.

There’s additionally a robust argument that the inexperienced methanol it bought for the lengthy preliminary journey was very inexperienced. It was manufactured from biomethane emitted from landfills within the USA. Methane is a way more potent greenhouse gasoline than carbon dioxide, and our meals waste, livestock dung, wooden chips and agricultural stalk waste is a really massive local weather drawback as nicely. Diverting biomethane that we’re unintentionally creating into methanol is a wonderful approach to make it a deeply carbon adverse industrial product. That stated, landfills have been required for years to seize or burn off the methane that comes from them within the developed world, so the chances that the inexperienced methanol was comprised of biomethane that will in any other case have been vented to the environment are low.

The large down facet is that Maersk is just not taking any of these legacy methanol emissions off the board. It’s shopping for extra methanol that will not in any other case be manufactured. Its use of methanol as a transport gasoline is along with the roughly 170 million tons manufactured yearly.

Job one for main local weather issues is to repair the emissions of the present merchandise or scale back using them, not multiply demand for them.

Multiplying demand for methanol isn’t like growing electrical energy demand. That commodity already powers business, commerce, transportation, heating, and lighting in all places, and everybody makes use of it. An information middle, for instance, whereas an enormous energy draw, remains to be a tiny fraction of electrical energy. Methanol is a way more narrowly industrial feedstock, one which isn’t burned. Multiplying demand for it and having that use case explicitly create carbon dioxide is on the different finish of the spectrum.

There may be one other benefit to methanol value mentioning. It doesn’t create practically as a lot air air pollution in ports as ships steam out and in, and as they sit in ports operating their auxiliary energy models. That’s good. It’s additionally considerably irrelevant as the identical outcomes might be met with a lot decrease considerations with hybrid battery-electric drivetrains and mooring provision on auxiliary energy, one thing that’s already spreading rapidly.

My expectations of what’s going to truly occur with Maersk’s dual-fuel ships stay unchanged. As the value and footprint of methanol sinks in, and as they get carbon-priced by the EU emissions buying and selling scheme and carbon border adjustment mechanisms, the ships will find yourself bunkering biodiesel and nearly by no means burn methanol. It is going to be cheaper, vastly extra out there in ports and be extra local weather pleasant. The actual pathway for transport which doesn’t simply electrify fully is dual-fuel with electrons and biofuels.