SHRINKING FOOTPRINTS AND PARASITIC ENERGY DEMAND

Tamara de Gruyter of Wärtsilä discusses the challenges of balancing footprint, solvent and energy requirements when marinising carbon capture and storage (CCS) technology for onboard CCS systems, and calls for regulators to bear CCS technology in mind during MEPC80 discussions

Thank you for agreeing to the interview. Looking at the wider regulatory context for carbon capture and storage (CCS), could you discuss the importance of establishing a clear regulatory framework?

If you look at the regulatory context, a lot of things are moving in the right direction. We have had carbon compliance indicators, such as CII, EEXI, and the emissions trading system (ETS) in the EU, as well as fiscal regulation.

These are starting to impact our customers’ operations … driving us all towards a greener world. One element of a greener world for us is also CCS. And I think while the IMO is maybe a bit slower, they acknowledge the potential, but I think then really getting regulations for maritime that are global, that's not really there yet.

But the regulatory environment is important, because it also sends a clear message to the industry, about the kind of technology they should invest in. And carbon capture is definitely one of the many technologies that can help customers.

One of the interesting aspects of CCS that has yet to be defined is how credits for CCS should be structured. Do you think the scheme should ascribe credit if the CO2 is reused?

I think it would be a good thing. When you look a bit more medium or long term, probably it's going to be a licence to operate. It’s going to be part of your operational costs there because that's the only way to incentivise people to bring down the CO2 footprint of the ship by whatever means. I also think, when considering what to do with all this captured CO2, that early movers will have the opportunity to sell the CO2 capture.

Over the medium to long term, we will be capturing way more CO2 compared to other industries. There's likely to be a transition when you're not going to get paid for the CO2 you are able to deliver, but you have to pay to dispose of it. At some point there will be too much and then it will have to be sequestered somewhere. And that probably has a price. I think this will also be a journey for the CO2 industry that will develop after the CO2 is captured.

Which leads into some wider questions about the emergence of supply chains for renewable or green ammonia, green methanol or other e-fuels. Do you think that might also emerge as an end use market for some of the captured CO2 without having to look into underground sequestration?

Of course, green fuels also form part of the potential end-use markets [alongside carbonated drinks and greenhouses]. While we would like to see all the steps in the process ready, I think… you also have to accept that certain things will play out over time.

We are focusing on the onboard carbon capture, but the maritime industry is not the only hard-to-abate industry that is looking at CCS. So, I think we will also benefit in the marine industry from the infrastructure that will also be built for land based carbon that is [going to be] captured. We are playing a central role in LINCCS (linking carbon capture and storage) for the CCS value chain, which is a collaborative cooperation between many companies.

Since we spoke in Vaasa in 2022, the CCS market has been transformed with a large number of technology developers seeking to develop marinised solutions.

Yes, it does seem to be evolving very quickly. It has definitely become an active space. Within Wärtsilä, we have a saying that “green is not black and white”. Unlike in previous transitions, we think that there will be a multitude of solutions, reflecting local technology and fuel availability.

Looking further ahead, we should recognise that we are likely to be working with fossil fuels for quite a long time. Because, as our experience with LNG has shown, it's not so easy to really transform our whole industry rapidly, and partly because some of the green fuels under consideration, such as methanol or some biofuels, might not be fully carbon neutral unless you combine them with carbon capture.

Before we look at the technology itself, do you think that there could be a role for some sort of certification to ensure the CO2 has been captured and safely disposed of?

I think it's a good question. When I look at it more from a ship perspective, I think it's how are you as a ship owner going to prove that you are capturing the carbon? I think that's the first step, you're capturing it from your fuel. So I think that that is something that probably will be regulated or tested, I can also imagine that you probably have to do a test on board of the vessel to prove that the system is working.

I think that is a separate issue to your wider question, which is how to certify that the whole CO2 sequestration chain has been followed.

A related question is the extent to which you see the introduction of CCS as dependent upon the introduction of a carbon price?

I think that regulation has been one way of forcing the industry to take steps, and the social licence to operate is another strong driver.

We recognise that financial incentives are also required to ensure a common playing field and to reward market participants who have invested in decarbonisation technologies such as this one.

But returning to the first question, do you think that the upcoming meeting of the MEPC committee at the IMO in June needs to add carbon capture into the list of recognised technologies for CII and EEXI purposes?

I would like to see a bit more speed and also recognition of CCS as a technology. I also hope that we realise that there's not enough carbon or carbon free fuels, that because you will then have to make them maybe with fossil fuels. So, we also have to have enough realism not to rule out certain solutions, because we feel they are maybe not green enough.

Turning to some of the shoreside infrastructure issues, would you like to address any of the concerns about the handling of captured carbon, given the toxicity of pure CO2, as well as moisture constraints.

CCS has been used for many years, so it's not exactly new technology. While I don’t think there has been much incentive to use it in a very wide scale, you could say some land-based projects have definitely proven its technical, but also commercial viability.

At Wärtsilä, we are focusing on onboard carbon capture for maritime, and there is a lot of knowledge in the world by other parties, and at some point would have to buy the shore side infrastructure. There are already some projects, especially in North Europe, ongoing that have started to work on this.

The fact that CCS solutions are actually already in the market, means that the infrastructure to discharge CO2 shouldn’t be a barrier to wider adoption, I guess. Which is a key difference compared with some other breakthrough technologies, like hydrogen.

I think the main challenge that we have is that if you want to marinise this technology, it needs to fit on a ship. And in a lot of cases, it might have to fit on an existing ship where [no] space was [originally allocated] in the first place.

It is very important to show how to make CCS neat and small, but also how to make it durable to be able to use onboard a ship, which is very different from stationary landbased uses. So the challenge is how to use that technology and put it in reliable, sturdy, small footprint, concepts that we can use onboard ships.

And that leads us really neatly on to where you're spending a lot of your time, which is exactly looking at those looking at those challenges.

Yes, exactly. I think the other thing we shouldn't underestimate is that you don’t only have to make it in a size that fits in a weight, but that [you have to manage] the energy consumption. You cannot put a second main engine on the ship just to run the carbon capture plant.

I think that that is an extremely important element. If I can share a story from the market, I remember talking to a ship owner in Asia who was proudly telling me that they had taken part in a carbon capture pilot project. But he also admitted that the vessel couldn't leave the port because the whole engine power was running the carbon capture plant.

He said that as a proof of concept, it worked. But it's not something we can use. The challenge of how to make CCS

Circular Carbon Economy

There are several regulatory initiatives to promote the use of fuels made with recycled carbon.

These include the EU’s Renewable Energy Directive (RED II), which promotes the use of “recycled carbon fuels” as long as they generate emission savings of at least 70% possible in reality on board a ship is one we're working on with our R&D team.. within the next 12 months on board a vessel. Im quite at first pilot will also give us a lot more input to e the nd finally, you mentioned that ou're your d e and 4-stroke hat it will, will be ting for g retrofit solutions for their g assets? eah, I think I think it will raise a lot of terest fits because it could er a financial incentive, or how to tions, fits, because for the nt ecially some ybe ithin the that ed to be relative to their fossil counterparts.

And one of the areas of research is around solvent consumption. Is the development of solvents a space that you’re actively looking at, or are looking at mature solvents as a first phase?

Of course, we are testing a lot of different solvents to make sure that we pick the right one. But I think you also need to have [solvent] availability and reusability. I also believe that as this industry grows not only in marine, but also on land, of course, the solvent space will divide.

But I think that solvent selection is definitely one of the key things in order to make CCS a financially viable concept, alongside energy consumption and reusability.

Do you see there being a kind of minimum threshold in terms of energy consumption? Or do you anticipate there may be progressive reductions as the technology matures? Or perhaps both?

I think it's a very good point. Because I think first of all, you need to come with a solution. But solvent selection is a key. It's a key critical factor, because the solvent, of course, also has an impact on the energy needs on board.

Can you give us an update on how things are going with your own developments?

But we are currently doing testing, and testing actually takes quite a long time. We are iterating, we are doing the testing. In addition, we are planning to schedule the next big test within the next 12 months on board a vessel. I'm quite sure that this continue to productise the technology.

And you're looking at developing your onboard CCS solutions for both the 2-stroke and 4-stroke market? Do you think that it will, will be particularly interesting for vessels for operators looking for retro existing assets?

Yeah, I think I think it will raise a lot of interest for retro be either a comply with the CII indicator. According to our calculations, I believe that there is a large market for retro merchant segment, it's not so easy to especially with some ships that are maybe a bit older, to still keep them within the eight things that they need to be.

In the State of California in the United States, a Low Carbon Fuel Standard provides credits for fuels with a lower carbon intensity than petrol, with credits trading at USD 90/ ton of CO2. This measure can be combined with the US 45Q tax credit, which has recently been increased through the Inflation Reduction Act to USD 60 per ton of CO2 used, providing emission reductions are verified.

The IEA notes that national requirements for low-carbon fuels in aviation fuel have been introduced in France, Norway and Sweden and France.