Ocean carrier Hapag-Lloyd’s CEO Rolf Habben Jansen said the limited availability of green fuels will be the main obstacle to realizing commercial shipping’s net-zero ambition. According to Bunkerspot.com, Habben Jansen made the comments while answering questions from industry guests in a live virtual session on December 9. 

“That’s probably the thing that keeps us awake most, that’s also why we are prepared to sign offtake agreements for longer periods of time,” Habben Jansen said. “That’s probably the single biggest worry, because in five or ten years from today, there will be significantly more ships that can sail on green fuels than there will be green fuels available.”

A green fuel offtake agreement is a long-term contract between a buyer and a producer to purchase a specific volume of green fuel. Offtake agreements are considered essential for the development of green fuel projects because they help secure financing and provide a steady revenue stream for producers.

Hapag-Lloyd announced in November it had reached a long-term agreement with Goldwind, a clean energy provider with headquarters in Beijing, China, for the delivery of 250,000 tonnes of green methanol per year, starting in 2026. The green methanol will consist of a blend of bio- and e-methanol, ensuring greenhouse gas (GHG) emissions reduction of at least 70%. The container line claims the fuel switch could cut up to 400,000 tonnes of CO2e emissions per year. The length of the contract was not revealed.

Asked about his confidence in future green methanol availability in other regions of the world, Habben Jansen replied that it is “difficult to judge at this point in time.”

“We are talking to various people about the availability of green fuels, not only green methanol but also others. At the moment, we see that the availability of green fuels is still a big problem.”

Hapag-Lloyd has committed to reducing its absolute greenhouse gas emissions by around a third by 2030 and achieving net-zero fleet operations by 2045.

The company’s CEO anticipates that the fleet’s speed will have to go down to meet new regulation on emissions reductions. “We will all have to reduce emissions. Also, because the availability of green fuels is somewhat limited, I do expect that when we look between now and 2030, we will have to look at ways to make our network more efficient, and also to allow us to slow down somewhat.

“How much will be possible? That remains to be seen, but slowing down has a massive impact on the emissions that we create,” Habben Jansen added.

Slowing down the entire fleet by an average of about 3 knots would bring down overall emissions by 20%, he said.

Hapag-Lloyd recently placed orders for 24 new container ships equipped with fuel-efficient liquified natural gas (LNG) engines, with the goal of achieving its Strategy 2030 goals of modernizing and decarbonizing its fleet. The two contracts, worth $4 billion, are with two Chinese shipyards. The ships are scheduled to be delivered between 2027 and 2029.

“We believe that at this point in time, for this series, opting for LNG is the right thing to do, because that fuel is already available,” Habben Jansen commented. “In addition, we are also retrofitting some ships to methanol, so we will certainly also do more on that front. Ammonia, we believe, is still a little bit further out.”