Study on future fuels for cargo vessels in the Baltic Sea

Nasif RahmanLaiva 2025

Espoo, 29.08.2013

Laiva 2025

ObjectivesTo analyze four non-conventional fuels considering Heavy

Fuel Oil (HFO) and Marine Gas Oil (MGO) combination as baseline properties

Fossil fuels Liquefied natural gas (LNG) Liquefied petroleum gas (LPG)

Biofuels Biodiesel (B100) Bioethanol (E85)

Marine Gas Oil (MGO) as main fuelTo analyze the ability of these fuels to fulfill future (2025)

environmental regulations on air emissionsTo carry out a cost analysis based on the net present value

(NPV) calculations of a case ship with the five fuel options

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Major Upcoming regulations2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

NOx

Tier II 2,5 g/KWh below Tier I (14.4 g/KWh for slow speed engines)

Tier III80% reduction from Tier I (3.4 g/KWh for slow speed engines),regionally in

the ECAs

SOx

SECA Effective from 1 July, 20101,00% m/m 0,1 % m/m

GlobalPrior4,5% m/m

3,5% m/m Review 0,5% m/m

EEDI

Phase 0 (ref. line)

2-20 gCO2 per

ton.nm for dwt 40000-

2000

Phase 1 10% reduction from Phase 0

Phase 2 20% reduction from Phase 0

Phase 3 - 30%

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Air emission assessment model (AEAM) Engine RPM

DWT variation (tons)

All types Bulk

carriers<130130-2000 >2000

10000-20000

>20000

NOxIMO Tier I 0 0 0IMO Tier II 1 1 1IMO Tier III 2 2 2

CO2

EEDI Phase 0 0 0EEDI Phase 1 1 1EEDI Phase 2 2 2EEDI Phase 3 3 3

Sulphur content SECA

Before 1 July 2010 0Between 1 July 2010 and

1 Jan 2015 1After 1 Jan 2015 2

PM

Sulphates

-2 to +2

NitratesVOC from

HCHeavy metalSoot

NH3 -2 to +2Methane -2 to +2

CO -2 to +2HC -2 to +2

Ship specific

emmisions

CFCs 19-May-05 1

HCFCs 1-Jan-20 1Total

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Case study: m/s EiraDimensionsLength overall 157 m

Length BPP 148 m

Breadth 24.6 m

Depth 13 m

Draft s.w 9.03 m

Deadweight 19625 tons

Lightweight 6428 tons

Main Engine 7860 KW 129 rpm

Auxiliary Engine (3 nos)

840 KW each, 1000 rpm

Source: ESL Shipping Oy

Ice Class IA Super: Baseline case 14 nautical mile per hour (knots) 75% maximum continuous rating

(MCR) of the engines

Ice Class IA 14 knots 75% maximum continuous rating

(MCR) of the engines

Ice Class IA Super slow steaming: 11 nautical mile per hour (knots) 50% maximum continuous rating

(MCR) of the engines

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Energy Efficiency Design Index (EEDI) calculation for different fuels

EEDI = The calculated EEDI is a theoretical measure of the CO2

mass emitted per unit of transport work (grams CO2 per ton nautical mile) for a particular ship design

Variation in carbon content and specific fuel consumption of fuels

Variation in engine’s power requirement for different Ice Class

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Energy Efficiency Design Index (EEDI) results

Phase 0: starts from 2013Phase 1: starts from 2015Phase 2: starts from 2020Phase 3: starts from 2025

HFO+MGO LNG LPG Biodiesel Bioethanol MGO

-25

-20

-15

-10

-5

0

5

10

15

20

25

EEDI variations from HFO+MGO

IA super slow

IA super

IA

Alternative fuels

% re

ducti

on fr

om H

FO+M

DO v

alue

FuelsIce Class IA Super

Ice Class IA

Ice Class IA Super

Slow speed

HFO+MGO4.06% below

Phase 1

4.2% below Phase 1

4.2% over Phase 2

LNG9.1% over Phase 2

8.9% over Phase 2

14.73% over Phase

3

LPG7.6% over phase 1

7.3% over phase 1

3.2% over Phase 3

Biodiesel

25.4% below

Phase 1

25.7% below

Phase 1

1.7% below Phase 1

Bioethanol1.4% below

Phase 11.7% below

Phase 18.6% over Phase 2

MGO7.4% below

Phase 17.6% below

Phase 11.3% over Phase 2

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Nitrogen Oxides (NOx) and Sulphur Oxides (SOx) emission results

0 100 200 300 400 500 600 700 800 900 10000.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

16.00

18.00

IMO NOx emission limits

IMO LIMIT 2000 (Tier 1)

IMO LIMIT 2011 (Tier 2)

IMO LIMIT 2021 (Tier 3)

Engine rpm

NO

x g/

KWh

Source: IMO MARPOL annex VI reg. 13

All main and auxiliary engines pass Tier III with LNG

With LPG and ethanol, the passing limits are Tier II

HFO and MGO pass Tier I Biodiesel can only pass Tier I

with slow steaming All the studied fuel contain very

low sulphur than HFO and MGO, they all can pass SECA 2015 regulation

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Air emission assessment model results

Does not show much variations between Ice Class IA Super and Ice Class IA

Results are better in slow steaming case LNG and then LPG give best results

HFO

+MGO

LNG

Biod

isel

LPG

Etha

nol

MGO

HFO

+MGO

LNG

Biod

isel

LPG

Etha

nol

MGO

HFO

+MGO

LNG

Biod

isel

LPG

Etha

nol

MGO

IA super IA IA super slow-4

-2

0

2

4

6

8

10

12

14

Model value comparision

OthersSOxEEDINOx

Variable cases

Mod

el v

alue

s

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Net present value (NPV) estimation: variables

Up to 2025, biodiesel as main fuel would be the most expensive After 2025, heavy fuel oil (HFO) as main fuel would be the most

expensive Investments cost other than machinery costs have kept constant

for both cases

0

500

1000

1500

2000

2500

2010 2015 2020 2025 2030 2035 2040

Euro

s

Year

Fuel price forecast

HFO

MGO (low S)

LNG

LPG

Biodiesel

Ethanol

HFO LNG LPG Biodiesel Ethanol MGO0

1000

2000

3000

4000

5000

6000

7000

8000Machinery first cost

Fuel Heating device

Gas reformer

Fuel tanks

Aux Engine

Propulsion engine

Mac

hine

ry fi

rst c

ost K

EUR

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Net present value (NPV) estimation: Annual fuel cost

About two third cost with 11 knots speed than 14 knots Ethanol is much cheaper but its consumption is high for same power output As a result, cost with ethanol is similar with LNG and LPG

2010 2015 2020 2025 2030 20350

2

4

6

8

10

12

Annual fuel costs 14 knots

HFO+MGOLNGLPGBiodiselEthanolMGO

Year

Mill

ion

Euro

s

Net present value (NPV) estimation

Slow steaming offers less NPV value for the ship for non-conventional fuels

Change in annual income with LNG/LPG for DWT/gross volume loss from 305 cubic meters net volume (119 ton) fuel tanks

In case with HFO and MGO, slow steaming provides better NPV because of their high fuel price in the future

-10

-5

0

5

10

15

20

25

NPV

MEu

ro

NPV variations

14 knots

11 knots

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ConclusionsLNG would be the best fuel option considering

air emission properties and cost analysisSmall difference in results in case of Ice Class

IA Much better results on air emission properties

in case of slow steamingSlow steaming must be decided based on cargo

flow in the marketWhole lifecycle CO2 emission analysis needed

for biodiesel

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Future ChallengesCost reduction from less air emissions: Mainly

on reduction of NOx and SOx emission Port of Stockholm: up to 23% Port of Mariehamn: up to 24% Port of Rotterdam: up to 10%

CO2 trade: the EU scheme The European Union Emission Trading Scheme:

Cap and Trade Principal 31 countries involved; 1,000 factories, power

stations, and other installations with a net heat excess of 20 MW as of Jan 2013

Shipping not included (near future?)

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Thank you