PDB – Navigant – Stakeholders view on renewable fuels in maritime sector

    Stakeholders about deployment of renewable fuels for seagoing shipping

    Netherlands Platform Sustainable Biofuels, Navigant

    Netherlands Platform Sustainable Biofuels (PDB) in collaboration with Navigant, organised a stakeholder consultation about the deployment of renewable fuels in maritime shipping sector.  The consultation was commission by the Department Maritime Affairs of the Dutch Ministry of Infrastructure and Water Management.

    Download the report.

    Main market barriers

    The price difference between renewable fuels and fossil fuels, as well as the lack of regulation (like e.g. a blending obligation) are the main barriers for market entrance of renewable fuels in the international maritime sector. A few market parties have introduced renewable fuels, but for large scale deployment supportive policy measures are essential.

    Establishing a larger demand for renewable fuels will ignite a larger supply as fuel suppliers will have more certainty about selling sufficient volumes. Ultimately this would lead to lower costs for renewable alternatives (as a result of economies of scale, learning effects and increased competitions when more suppliers enter the market).

    This stakeholder consultation showed that the sector needs measures and instruments for the deployment of renewable energy in shipping. In majority participants in the consultation process were positive about the establishment of an international mandate/obligation for deploying renewable fuels as a means to reduce the climate impact of vessels. The sector advocates for an obligation by the International Maritime Organisation (IMO). At the same other  instruments need to be investigated given the possibility of incorporating  shipping under the EU-Emission Trading Scheme (ETS), as is one of the proposals of the European Green Deal by ECs Vice President Mr. Timmermans. The stakeholders also emphasised the possibility of inclusion of renewable fuels in technical standards for shipping fuels.

    One very concrete short term opportunity for the support of renewable fuels in shipping is presented in the  European Renewable Energy Directive, the so-called RED2, which provides the ‘opt-in’ for shipping. Such an opt-in can act as ‘starting engine’ for the deployment of renewable energy in maritime shipping. The opt-in enables that renewable energy supplied to the shipping sector can count towards the national obligation in road transport. In the stakeholder report the principle is explained and an overview of pro’s and con’s is provided.

    Conclusions stakeholder consultatie

    1. Make use of the ‘opt-in’ facility (see above) and develop simultaneously, in an international ‘coalition of the willing’, an international obligation instrument for the deployment of renewable fuels in the shipping sector
    2. Develop a programme for renewable fuel options for the international maritime sector, including ‘short-sea’.
    3. Address innovation and knowledge challenges with the stimulation of a “learning community renewable fuels”, in which knowledge institutions, the education sector and sector parties are involved.

    The report can be downloaded here.

    For more shipping-related issues go here.

    • Date 31/01/2020
    • Tags 2019, Biofuels, Legislation, Market perspective, Policy, Shipping