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The use of biofuels in shipping is on the rise. Their ability to provide a cost effective and more environmentally friendly alternative to traditional fossil fuels makes them an attractive prospect for the maritime industry.

This article looks at the role of biofuels in shipping – examining the different types of biofuels currently available, the factors driving their use, and the key considerations when shipping biofuels – in order to assess whether biofuels can power the future of maritime transport.

 

What are biofuels?

 

Biofuels are any type of fuel that is made from biomass or organic waste, for example plant material, animal waste, or algae material. Biofuels also include methane produced from landfill gas and biogas, and hydrogen produced from renewable resources. In contrast with fossil fuels, biofuels are considered to be a source of renewable energy. 

Different types of biofuels

There are three main types of biofuels: solid, liquid and gaseous. Some of the most commonly used biofuels include:

  • Biobutanol
  • Biodiesel
  • Bioethanol
  • Biogas
  • Biomethane
  • Butanol
  • Dimethyl ether
  • Ethanol
  • Methane gas
  • Methanol
  • Renewable diesel (HVO)

What is HVO fuel​?

 

The term HVO fuel stands for Hydrotreated Vegetable Oil – a low carbon biofuel which is also known as renewable diesel or green diesel. Made from certified waste lipids (e.g. vegetable oil, tallow, or used cooking oil), it is a fossil-free paraffinic diesel, meaning it can be used as a direct replacement for mineral diesel. HVO is known to be one of the cleanest fuels available, capable of eliminating up to 90% of net CO2 and significantly lowering nitrogen oxide (NOx), particulate matter (PM) and carbon monoxide (CO) emissions.

 

What is sustainable aviation fuel​?

 

Sustainable aviation fuel (SAF) is a type of alternative fuel made from non-petroleum-based renewable feedstocks, such as municipal solid waste, woody biomass, fats, greases, oils, and other feedstocks. SAF can be blended at different levels from 10% to 50%, depending on the feedstock and how the fuel is produced. 

What is driving biofuel growth?

Compatibility with existing combustion systems
One of the key advantages of biofuels is that they can be used as ‘drop in’ fuels. In other words, they can be used in existing conventional combustion engines without the need for modifications, plus they use existing distribution and refuelling infrastructure. In the context of global shipping, this means that biofuels offer a way for shipowners to meet greenhouse gas emission reduction targets without needing to spend large amounts of money on new vessels and/or modifying existing vessels to make them compatible with other alternative fuels. As such, biofuels present the maritime industry with a practical and immediate replacement for fossil fuels that can help to drive the green transition.

Helping address decarbonisation challenges in key sectors
In recent years, we have seen governments and other public bodies introduce targets and regulations aimed at addressing climate change and supporting the green transition. In shipping, two such examples are the IMO’s Carbon Intensity Indicator (CII) regime and the EU Emissions Trading System (EU ETS). Both of these heavily incentivise the use of alternative ‘greener’ fuels, such as biofuels. As a result, biofuels are gaining popularity given they provide an immediate alternative to fossil fuels and can help companies meet regulations, avoid financial penalties, and become a more sustainable business by accelerating decarbonisation across the maritime industry. Having said that, it is important to note that these benefits depend on the biofuels being properly certified and meeting strict sustainability and emissions standards. If they don’t, they will be treated the same as fossil fuels under the regulations. As such, it’s important to work with an experienced broker who can ensure any charterparty agreements protect your interests. For example, a broker may help a biofuel buyer to negotiate a supply contract which includes warranties that the fuel meets international standards, proof of certification, and Bunker Delivery Notes (BDNs) showing the greenhouse gas (GHG) emissions from the fuel’s production and use.

Few barriers to entry for industrial growth
Given that biofuels can be produced and distributed using existing industrial facilities, there is a lower barrier to entry for industrial growth and technological development. As such, they offer a huge opportunity to generate employment (i.e. creating jobs related to turning agricultural and industrial waste into energy), in turn supporting the development of the circular economy and boosting local economies.

Enhanced energy security
Biofuel production not only helps to diversify a country’s energy mix, but also guarantees supply, thus helping boost energy security. This is because biofuels can be produced locally using domestic raw materials, thereby reducing dependency on imported fuels.

How are biofuels shipped? 

 

Biofuels – either the finished product or there crude/refined feedstocks – are mostly shipped on IMO classed chemical tankers. Some biofuels have more advanced seaborne carriage requirements than others and therefore the type of ship, its tank coatings and its last cargos are an important part of biofuel shipping. The chemical tanker market is a complex sector of the shipping markets with these vessels highly specialised in their construction to maintain flexibility and versatility for the range of different cargos they are required to carry. Biofuels is just one area of the market that these ships service

 

How long does biofuel last​? 

 

The typical shelf life for biofuel is around six to 12 months. While this is a shorter shelf life than fossil fuels, using stabilisers and ensuring proper storage in cool, dry conditions can help to extend its lifespan.