BW LPG executive vice president, technical and operations Pontus Kristofer Berg explains why BW has committed to LPG as the fuel of the future
BW LPG began its journey towards LPG propulsion in early 2016 when we started planning for the IMO 2020 sulphur regulations. We realised that we needed an efficient vessel design that would be both sustainable and future-proof.
We quickly settled on LPG as the fuel type, which we strongly believe is the future fuel for the next generation of vessels. Our initial design was for a newbuild, but we later converted that into a retrofit solution.
Operationally, LPG is cleaner and easier to manage than fuel oil or LNG. But in terms of bunkering there are real savings to be made. We can bunker LPG while loading cargo, and this can save between four- and five-days bunkering time per year. Furthermore, bunkering directly at the loading terminal saves time and the additional costs of a bunkering barge.
Critically, the infrastructure needed to facilitate LPG bunkering is already in place, meaning there are no ‘chicken and egg’ concerns that hamper the uptake of other alternative fuels. There is a large network of import and export terminals around the world that can easily become LPG bunkering points; alternatively, ship-to-ship bunkering can take place using smaller LPG carriers.
As a fuel source for a dual-fuel engine, LPG ensures optionality and full redundancy for uninterrupted operations and it already comes halfway to meeting the IMO 2050 emissions target of a 50% cut in greenhouse gases. It achieves this without the unfortunate side effect of methane slip, which remains a significant obstacle to the uptake of LNG.
These factors mean the cost savings of employing LPG are significant and include lower installation costs, cheaper operating costs and lower maintenance requirements than LNG equivalents. The higher energy content also means fuel consumption is lowered. We see consumption being 10 to 15% lower for LPG when compared to compliant fuel and scrubbers. We also factor in the lower price of LPG compared to compliant fuel for both 2020 and 2021 and while the price differentials have decreased following the recent collapse in oil prices, we expect these differentials to widen again when the oil market recovers.
From an environmental perspective, installing new technology on existing vessels should appeal to both customers and peers. The construction of a new vessel generates about 70,000 tonnes of CO2, but taking a retrofit approach reduces this massively, down to about 2,000 tonnes. And while operating on LPG as opposed to fuel oil saves close to 5,000 tonnes of CO2 per year, the environmental payback for a newbuild is 15 years; for a retrofit that falls to less than six months.
Ultimately, the carbon footprint of a conversion is about 35 times less that of a newbuild, with the added benefit that retrofitting existing ships does not contribute to any further oversupply of vessels.
We consider this technology to be a stepping-stone towards the use of ammonia as a zero-carbon emission fuel. It also eliminates bunker quality issues, spill risks and waiting time. With ammonia likely to be the next big future fuel in shipping, our operational experience with LPG will be extremely valuable. This investment is expected to increase our competitiveness by using efficient fuel and at the same time, contribute significantly to a reduction in emissions.
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