Fuel and power system selection for newbuild vessels

CUSTOMER CHALLENGE

Our client wanted to understand how fuel prices, greenhouse gas (GHG) policies, subsidies and penalties were expected to evolve at European and international level, with respect to relevant fuel and power system technology options. Regulatory GHG costs will form an increasingly significant proportion of total operating costs, so the selection of the optimum fuel options for long-life vessel assets is critical.

RICARDO SOLUTION

Ricardo’s Quantified Scenario Analysis Tool combined with expertise on EU/IMO policies, life cycle assessment and marine total cost of ownership were leveraged to robustly assess the future suitability of each fuel type. The analysis included:

• Policy roadmaps with future GHG reduction targets and interplay between the EU and IMO frameworks
• Operational implications such as annual energy and fuel demand, utilisation efficiency and loss of revenue from reduced cargo capacity.
• 3 distinct scenarios capturing future uncertainties in policy evolution, fuel price and GHG emissions through to 2050
• Comparison of Weight to Weight emissions and Total Cost of Ownership (TCO) of different decarbonisation options across different scenarios
• Overall suitability of technology options across all scenarios with respect to economical, environmental and practical criteria

CUSTOMER BENEFIT

The client was able to use robust data driven evidence to support their investment decisions, with up to 513 Million Euro savings highlighted for their fleet operations throughout the process. The client also has a clear understanding of key risks associated with most suitable fuel types along with mitigation strategies, enabling strategic decisions to be made with reliable insights.