Decarbonisation Technology - August 2024 Issue

Role of liquefied CO2 carriers in the carbon value chain Demand for carbon capture is set to grow and with it demand for ships to carry it for storage or new applications

Tao Shen American Bureau of Shipping (ABS) Global Sustainability Center

C arbon capture, transport, and storage will be essential for achieving the decarbonisation of the world economy in line with the greenhouse gas (GHG) emission reduction targets of the Paris Agreement. Sequestration of CO 2 captured from onshore power stations, petrochemical and other industrial plants, and manufacturing processes forms the principal demand driver for the transport of liquefied CO2 (LCO 2 ) by ship. As per the latest report from the Global CCS Institute, the capacity of all carbon capture and storage (CCS) facilities under development has grown to 361 million tonnes per annum – growth of 48% since the 2022 report. Total capacity of the CCS project pipeline has grown at a compound rate of more than 35% per annum since 2017, and the 48% annual increase in 2023 is the largest since upward momentum began in 2018. The number of CCS facilities in the development pipeline is also at an all-time high. As of July 2023, there are 392 projects, representing a 102% year-on-year increase. Since the Institute’s 2022 report, 11 new facilities have commenced operations, and 15 new projects have started construction. Some 198 new facilities have been added to the development pipeline, bringing the current total to 41 projects in operation, 26 under construction, and 325 in advanced and early development. Growing demand For the maritime industry, the 2023 International Maritime Organization (IMO) revised GHG Strategy of achieving net zero

GHG emissions by or around 2050 will lead to significant changes. Vessels will need to switch from traditional fuels to greener alternatives. Investments in liquefied natural gas (LNG), liquefied petroleum gas (LPG), and methanol dual-fuelled vessels continue to grow quickly, prompting industry discussion and debate about which alternative fuels producers can provide at affordable prices. For its updated Low Carbon Outlook , ABS re-examined the supply and demand data for alternative fuels and updated the future fuel mix to reflect the latest market information. In addition, the study looked at how the recent adoption of the revised IMO decarbonisation strategy and the 2050 net zero targets affected the projected future fuel mix. By combining the derived ship demand with a forecast for a changing fuel mix in deep sea shipping, the scenarios for global energy consumption are translated into global fuel consumption by ships. Overall, with the updated findings, ABS finds that by 2050, demand for fossil fuels has the potential to be marginally lower than that estimated in the previous edition of the Low Carbon Outlook , once again underlining the need for onboard carbon capture technologies. The adoption of onboard carbon capture for the shipping industry will require LCO 2 reception infrastructure at ports, from where the captured CO 2 can be transported to offshore storage or for industrial use. This could potentially drive LCO 2 shipping from ports to offshore facilities, whether over short or long distances. As the fleet of LCO2 carriers is expected to grow, there is a concern about the carbon