A.P. Møller – Maersk is putting more pieces of the puzzle in place to decarbonize its shipping fleet. Maersk Growth, a corporate venture arm of the company, on Wednesday invested in WasteFuel to produce green bio-methanol.
This announcement follows two August agreements Maersk signed to build eight methanol-powered ocean vessels and produce the carbon-neutral e-methanol to power those ships.
California-based startup WasteFuel is developing and expanding its offering of low-carbon fuels such as sustainable aviation fuel, green bio-methanol and renewable natural gas in Asia and the Americas.
This investment from Maersk will help WasteFuel develop biorefineries that can most effectively transform “unrecoverable waste that would otherwise degrade and release methane and other harmful emissions into the atmosphere” into a useful fuel — bio-methanol, according to a release.
“We know that sourcing an adequate amount of green fuel for our methanol- fueled vessels will be very challenging as it requires a significant production ramp-up globally,” Morten Bo Christiansen, VP and head of decarbonization at Maersk, said in the release.
“Collaboration and partnerships are key to scaling the production and distribution of sustainable fuels, and we look forward to doing exactly that with WasteFuel — exploring potential future green solutions not just for our vessels but also for Maersk aviation and trucking activities.”
Carbon-neutral methanol pathways
Maersk is investing in both e-methanol and green bio-methanol. Bio-methanol, also called renewable methanol, is produced from biomass feedstocks such as agricultural waste and biogas from landfills.
To make e-methanol, companies first produce green hydrogen using electrolysis to split water into hydrogen and oxygen using renewable electricity. Then methanol synthesis combines green hydrogen with captured CO2 from industrial sources to create e-methanol.
“WasteFuel was launched to solve two problems: the waste crisis that affects millions of people’s lives globally and the growing demand for low-carbon fuels that can reduce overall emissions. We’re proud to have partnered with Maersk to usher in an era of more environmentally conscious sea transport,” Trevor Neilson, co-founder, chairman and CEO of WasteFuel, said in the release.
WasteFuel’s goal is to reduce the life-cycle greenhouse gas emissions by 90% by switching to bio-methanol compared to fossil fuels, according to Neilson.
“Low-emission methanol could play a larger role in decarbonizing certain sectors where options are currently limited — particularly as a feedstock in the chemical industry or as a fuel in road or marine transport,” said a Methanol Institute and International Renewable Energy Agency report.
It said the main barrier to e-methanol and bio-methanol was the higher cost compared to methanol produced using natural gas. E-methanol costs rely on the price of producing green hydrogen and renewable electricity while bio-methanol costs rely on the price of feedstocks and compete with the alternative uses of those feedstocks.
Maersk’s methanol-powered vessels
The first of Maersk’s dual-fuel feeder vessels is scheduled to set sail in 2023. Deployment of the eight large dual-fuel container ships is set to begin in the first quarter of 2024.
The eight container vessels, equipped to run on methanol or very low sulfur fuel oil, are expected to save around 1 million metric tons of CO2 emissions annually.
“The time to act is now if we are to solve shipping’s climate challenge. This order proves that carbon-neutral solutions are available today across container vessel segments and that Maersk stands committed to the growing number of our customers who look to decarbonize their supply chains. Further, this is a firm signal to fuel producers that sizable market demand for the green fuels of the future is emerging at speed,” Maersk CEO Soren Skou said in a release.
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