The days of operators mainly using fossil fuels to power their ships are numbered. The International Maritime Organization (IMO) made this clear when it set a goal to reduce the shipping industry’s total greenhouse gas emissions by 50% by 2050. Since then, much of the conversation has been around future fuels and developing a successful zero-emission vessel, and shipowners and other industry players have already launched research and development efforts. However, the industry is yet to put the same focus on achieving another IMO goal, which was set at the same time and is just as ambitious and challenging.
IMO aims to reduce the average carbon intensity of ships by 40% by 2030. That means shipowners and operators, including cruise and ferry companies, need to deliver major efficiency improvements on their existing ships within the next 10 years. The problem is that there’s currently no clear guidance as to how this could be achieved, or perhaps more challengingly, how it will be financed.
As consumer-facing brands, cruise lines and ferry companies have long been at the forefront of innovation in the industry – whether that be operating with the most up-to-date safety systems or implementing energy-saving initiatives. The problem is that fuel consumption on these ships is also some of the highest in the shipping industry due to the additional energy required to entertain, cook for, clean up after and otherwise comfortably house thousands of passengers. However, this also means that the savings opportunity is the greatest.
Investment in new technologies often requires a significant capital expenditure (capex) and even in a growing market, margins are tight and demand for capital often has to be delicately balanced. This is especially true when considering the increasing numbers of newbuilds demanding finance. There are relatively few low- or no-capex solutions on the market for operators looking to increase efficiency on existing vessels without significant initial investments.
At Norsepower, we see paying up front for energy-efficiency solutions as an old way of thinking. It relies on the idea of a technology solution being sold as a product, based on the (sometimes questionable) promise of receiving a return on investment years down the road. This has been a significant barrier for investment for shipowners and clean technology businesses alike.
To overcome this, Norsepower has introduced its Technology as a Service payment model for its rotor sails, which reduce fuel consumption by providing auxiliary thrust from wind propulsion. Rather than ship operators paying for a technology and its installation up front and waiting to recoup that investment over time, Norsepower can deliver the rotor sails without capital expenditure and bill customers monthly with an amortised fee based on their measured fuel savings. This means there is no financial barrier to entry – ship operators only pay if they achieve fuel savings. Plus, this payment model provides the added benefits of a service agreement, which don’t come with a one-off purchase.
The service delivery approach guarantees that the owner will not pay out unless the technology functions as promised. This gives ship operators an added layer of assurance for Norsepower’s rotor sail technology on top of the verified and confirmed savings that have been achieved during active commercial applications already released to the market. Norsepower is essentially ‘de-risking’ the installation of Flettner rotors for applicable vessels, and this approach has seen it become the leading wind-assisted technology in the marine market. In fact, the system has already been installed on two commercially operating vessels and will soon be added to a third.
Wind-assisted propulsion has garnered a significant amount of interest as an extremely viable technology in recent years, largely because wind is one of the most freely available energy sources. A 2017 wind propulsion study by Netherlands-based research consultancy CE Delft noted that “there is significant saving potential in wind-assisted propulsion”.
Norsepower’s rotor sails are a modernised version of the Flettner rotor – a spinning cylinder that uses the Magnus effect to transform wind power into forwards thrust, allowing the main engine to be throttled back while maintaining optimum speed. The sails are highly effective based on advancements in manufacturing, material and technological solutions. Lightweight composite sandwich materials offer a simple, yet robust, high-tech and low maintenance solution for onboard structures. These materials reduce power requirements, withstand testing conditions and provide structurally sounds and stable installations.
For cruise ships and ferries, this type of sail has significant advantages over other, more traditional, wind-assist technologies. The spinning rotor has a fixed and relatively small on-deck footprint and the only moving part is the spinning surface, which means there are no shifting booms or lines. When the rotor sail’s motor is turned off, the propulsion effect halts, so it doesn’t need to be collapsed or taken off deck in unfavourable conditions. It’s permanently fixed and automatically turns on and off when appropriate.
Viking Line’s LNG-powered cruise ferry Viking Grace became the first passenger ship to install Norsepower’s rotor sails in April 2018. Currently operating in the archipelago between Turku, Finland and Stockholm, Sweden, Viking Grace was already acknowledged within the industry as one of the most environmentally friendly cruise ferries in the world. The addition of wind-assist technology will further decrease the vessel’s emissions, fuel burn and fuel costs. This will reduce carbon emissions by around 900 tonnes annually, which is equivalent to cutting 300 tonnes of LNG fuel per year.
Moreover, every passenger aboard Viking Grace and those who view her from shore now see a visible representation of Viking Line’s commitment to decreasing emissions. The striking look of the cylindrical Flettner rotor provides as much in reputational value as its fuel reduction properties provide in terms of financial value.
To some, using wind propulsion for shipping sounds like a backwards move. But with the pressure on operators to cut emissions and the potential for them to achieve a 10% reduction in fuel savings (and thereby carbon intensity) by installing a single technology that has proven commercial success, it’s clear that the future is bright for auxiliary wind.
When ship operators take steps to reduce fuel consumption, they should be reassured that they will be saving costs, not increasing them, and that they will achieve the added win-win that they are also contributing to saving the planet. The financial options are out there in the market to enable operators to adopt clean technologies at scale. Consequently, cruise and ferry lines, with their high consumer visibility, could be reaping the advantages and unlocking the full potential of the wind to propel international shipping towards a low-carbon future.
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