The below Q&As are based on an interview with Christian Vandvig Finnerup, Dan-Bunkering’s European Offshore Manager.

Why are alternative fuels so much on the agenda in the shipping industry?

First of all, there is a worldwide obligation to prevent climate change. Sea transportation accounts for the majority of goods transported in global trade and of course one of the tasks is to reduce greenhouse gas emissions. 


Is sea transportation worse compared to other transportation forms when it comes to harming the environment? 

No, sea transport is actually very CO2 efficient when comparing per tonne of transported goods compared to alternatives, but that does not mean that the industry can lean back. There is a huge task to be done going forward. 


What can the shipping industry do to ensure a reduced environmental impact?

Alternative fuels are one of the ways to reduce the environmental impact and comply with the regulations and targets set out by IMO.


What do you consider the most attractive alternative marine fuel?

Not mentioning one specific product, it will have to combine efficiency and economy, as well as take into consideration the product’s own environmental impact. To do this, it is important to have a cradle to grave perspective when assessing the actual environmental impact of the fuel. The future alternative fuels on the table for the moment are LNG, biofuel, methanol, LPG, ammonia, and hydrogen, and it is too soon to guess which one will be the best choice on a long-term perspective. However, it is likely that it will be a combination of several products and technologies as batteries, solar, and wind solutions are also getting attention.


Which of the alternative fuels do you believe will have the most traction in the short run?

LNG is already being supplied and the same goes for biofuels and in the short run, these are the two products that will probably get further traction within the shipping industry. 


What is the difference between the various generations in biofuel?

Well, what is called 1st generation is conventional biofuel, being produced directly from food crops, for instance wheat, corn etc. 
2nd generation can be non-edible plants or it must have fulfilled its original food purpose, so this can be waste vegetable oil or similar. 
3rd generation is for the moment considered to be only non-edible products. This can for instance be algae-based.


Is biofuel attractive from a price perspective? 

Today, the cost of biofuels is substantially higher than the cost of traditional fuels and that will be the case for some time. Governmental support can make it more competitive in the short run until we see a balance in a market where we have much higher supply to cover the demand. However, a requirement from consumers and companies willing to pay more for low-carbon transport could speed up the development.


What are the typical questions you are seeing from clients on biofuel?

It depends on how far the individual company is on their journey to reduce GHG emissions. It can be very basic, such as what is FAME and HVO? But we are also answering questions about blend ratios, pricing, hedging, trial runs and specific supply wishes.



Two promising Biofuels

FAME: fatty acid methyl ester

HVO: hydrotreated vegetable oil