We talk to the innovators and professionals who use the wind to power the maritime supply chain.
Wind Propulsion Principles
In this week episode, we look at vessel design and energy savings with our guest Konstantinos Fakiolas, a Greek naval architect who moved to Finland a few years ago to specialize in energy efficiency and wind assist technologies.
Kostas is the author of the reference book Wind Propulsion Principles, a complete guide to harvesting the winds for commercial shipping, edition 2.0 was released in December 2020.
In this interview, Kostas details the 3 main wind assist technologies - Flettner, Wing Sail and Kite, providing a hands on analysis of benefits and limitations for each of them.
As Europe’s busiest seaport, Rotterdam is buzzing with conversations about climate change, clean energy, and building the vessels of tomorrow. In today’s episode, we speak with Katarin Van Orshaegen, the Commercial Lead at GoodShipping, a Dutch-based company that guides ship owners who are ready to look beyond fossil fuels but don’t know where to start.
Speaking from her office overlooking the port of Amsterdam, we discussed the problems and opportunities ship owners face when deciding how to fuel their cargo vessels in an era of more choices, legislation around decarbonization, environmentally aware and engaged customers, costly lawsuits, and aging fleets.
She pointed out that in 2021, manufacturers who import and export overseas have very few options to reduce the Scope 3 emissions created by moving their goods across the oceans.
Carbon offsetting is usually the choice of those manufacturers; however, carbon offsetting doesn't directly reduce the emissions, it simply pays a premium price for being a polluter.
GoodShipping enters the picture as the first sustainable shipping initiative in the world, offering companies the opportunity to reduce their carbon footprint by switching their cargo shipping activities to biofuel. So far, the feedback is overwhelmingly positive as evidenced by winning clients like IKEA and being highlighted as carbon insetting frontrunners by DHL and Smart Freight Center (SFC)
Through this interview, Katarin details how two Dutch, purpose driven sister companies make this possible:
- GoodShipping customers finance the introduction of biofuels in the fuel mix, insetting their scope 3 emissions.
- GoodFuels produce sustainable biofuels from many types of waste, then deliver the biofuel to the selected vessel within a fleet.
We offer a huge thanks to Katarin for teaching us about carbon insetting, the Mass Balance principle and for clarifying that drop-in biofuels DO NOT require ship owners to retrofit the fuel apparatus in their vessels.
Good Shipping is now available to US companies.
In this week episode, we interview Tuomas Riski, a passionate Finnish entrepreneur, a citizen of the world who decided to act to reduce the global carbon emissions.
In 2012, Tuomas founded Norsepower Oy Ltd, bringing to the market a 21st century version of the Flettner Rotor.
At a time the carbon intensity of a vessel becomes critical, Tuomas Riski presents the use case of the M/V Estraden, a Ro-Ro vessel equipped with 2 mechanics sails since 2014.
M/V Estraden sails the North Sea, on a typical route between the UK and the Netherlands. The 2 rotor sails, 18m high each, save 400,000 kg of fuel on an annual basis.
The Winds of San Francisco
We started this podcast to feature not only established firms using wind propulsion, but to give up-and-comers a chance to describe their journey. In our conversation with Charlie Bogue, Director of Market Development & Strategy at Wind + Wing Technologies, we hear how a young company won a coveted bid to retrofit passenger ferries in the San Francisco Bay.
While competing against larger companies with longer histories and bigger gas tanks, Wind & Wing Technologies edged out the field by suggesting a hybrid solution with an eye to efficient routes, passenger satisfaction and low environmental impact. The approach piqued the interest of local legislators and ferry operators who praised an affordable and low-carbon answer to moving commuters across the bay.
Raised in the Bay Area and currently living in Europe, Charlie’s opinions on ship decarbonization, input from lawmakers, short sea shipping, market uptake in Europe and autonomous vessels are informed by his cross-borders experience.
He also told us about his role as the sole Yankee on the Executive Committee of the International WindShip Association (IWSA), and how as membership continues to grow, so does the urgency to present a cohesive message across the board.
Charlie’s passion for wind power grew from his childhood sailing trips with family on the West Coast and a concurrent career as the Director of Charters & Marketing for Adventure Cat Sailing, which takes 40,000 tourists per year on catamaran cruises under the Golden Gate Bridge.
Who pays for Global Shipping?
This week we take a deep dive into the financing of maritime assets.
Our guest is Tony Foster, CEO of Marine Capital in London, a maritime asset manager that links institutional capital to the shipping market.
Through real-life examples of investment strategies, Tony describes the changing behavior of the pension & infrastructure funds who comprise his investors. He explains that nowadays they are primarily driven by concerns about sustainability.
“Those institutions increasingly make decisions based upon numerous environmental and other precepts which will have to be met for investments to be sanctioned.”
Tony also explains his recent choice to focus on offshore wind “LNG is increasingly challenging: the institutional investors thinks in a longer term perspective: while the debate rages about the future of LNG, naturally it becomes more difficult to place the investment”
We also touch upon the transition toward zero carbon shipping: “For deep sea shipping, there are no carbon neutral solutions available as we speak. That solution will come over a generation. There are clear directions but the ultimate choices have not been made. So the transition is currently about Energy Saving Devices, which can be added to existing technologies over the next decade or so, ranging from wind assist, digital technologies, air bubbles, new propellers… There is a pretty serious piece of technical work required on a ship by ship basis to understand how a certain target might be reached. “
But for Tony, the energy savings is facing a fundamental obstacle: “We have a split incentive problem in the shipping world: a tonnage provider, a typical ship owner that rents out his ship, doesn’t get rewarded for making energy savings improvements. So the improvement that he makes would be reflected in a higher rate which would directly reflect the value of the savings of fuel, but it won’t reflect the investment that he has to make in the technology. Charterers are happy to take the benefits of the cost savings, but they are not happy to pay a return on the extra investment.”
Tony also walks us through the market based measures, recently announced or to be expected: “At a global level, we are ultimately expecting a fuel tax. We think the solution to the gap between the cost of new technologies and the equity risk that goes into those technologies has to be bridged by a variety of means. Although there are administrative issues around the operation of that tax, the IMO is the obvious organ through which it could be administered. “
Last but not least, because ESG also includes Social and Governance, Tony calls for more transparency & collaboration in the industry.
“One of the key challenges for the attraction of new capital to the industry is its poor record on governance, what is missing is this virtuous circle of collaborative business dealings and transparency of operations.”
Every cause needs its evangelists and the International WindShip Association has been spreading the gospel of wind propulsion since 2014. As the Secretary General of the Association, it’s up to Gavin Allwright to keep wind propulsion top of mind for commercial ship owners, policy makers and regulators.
The journey to become a leader in advocacy was not smooth sailing, but today, the IWSA’s 130+ membership is taking IMO’s 2030 goals a step further by declaring the years 2021-2030 as the “Decade of Wind Propulsion”, an era of delivering wind propulsion installations, optimizing the technology solutions and helping to facilitate a quicker, deeper and ultimately cheaper transition to a fully decarbonized fleet.
At the heart of our conversation, Gavin presents the motivations and objectives behind the IWSA’s March 24th open letter to the global shipping industry. We paraphrase the key points here…..
1. Establish a Multi-Stakeholder International Working Group to evaluate and quantify wind propulsion’s potential contribution to decarbonize the global fleet in the face of the climate emergency. Promote a hybrid approach to decarbonization with wind propulsion fully integrated with optimization measures along with eco-fuels.
2. Launch a Comprehensive Strategic Review of shipping industry decarbonization efforts in the context of the climate emergency. The review should quantify all externalities including infrastructure development and production costs of all alternative propulsion systems and fuels along with their direct and indirect climate impacts.
3. Ensure a ‘level playing field’ is created and maintained for all power systems, removal of market and non-market barriers as well as fair and balanced allocation of R&D finances and resources in the future.
4. Do more and go beyond the current narrow fuel-centric approach by adopting a fully integrated alternative propulsion approach to decarbonization pathways and policy.
Our biggest takeaway from Gavin is a quote he made toward the end of the interview. He simply asserted “We really can’t be ignoring such an incredibly important energy source that is uniquely available for shipping.”
We could not have said it better ourselves.