Shipping and hydrogen

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Newsletter

Published 05 May 2022
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Hydrogen has been launched as one potential path towards decarbonisation of our society. For the shipping industry, hydrogen is relevant mainly in two aspects; as a fuel and as a cargo. In both aspects, there are challenges and risks involved in the early stages of the commercialisation of hydrogen.

In order for the shipping industry to comply with reduced emission requirements, hydrogen has been a much talked about alternative to conventional fuel. The benefits of using hydrogen as a fuel are obvious – the emissions from vessels, if changing from conventional fuels to hydrogen, will be reduced dramatically. When hydrogen is used as fuel, emissions from a vessel will be mainly water and heat. Additional benefits of using hydrogen as a fuel compared with conventional carbon-based fuel may be reduced noise and vibrations on the vessel.

Switching from conventional carbon-based fuel to hydrogen is however not a straightforward operation. There are technical challenges, logistical as well as regulatory challenges.

There are different technologies for powering vessels by hydrogen such as using combustion engines, blending hydrogen in with other fuels, or a so-called hydrogen carrier, as ammonia (NH3), as well as pure hydrogen (H2) in liquid form, together with fuel cells. The "greenest" use of hydrogen as fuels on vessels is considered to be hydrogen fuel cells, while the use of hydrogen through ammonia is currently the most developed technology.

Since hydrogen as fuel on vessels is a new feature, regulation targeting hydrogen is still in its infancy. There is little regulation in place adressing hydrogen used as fuel on vessels. There are, however, more generic regulations that will be applicable and relevant also for vessels using hydrogen as a fuel.

One type of regulation relates to emission requirements. This regulation does not place any requirements of the use of hydrogen as fuel as such, but instead impose limitations on the emissions from a vessel generate by fuel. Developments in emissions regulations were presented in our newsletter in August 2021. Achieving the requirements in the emission regulation will be one reason for transitioning from carbon-based fuel to hydrogen.

Another type of regulation relates to the safety of vessels. In this respect, in particular the International Convention for Safety of Life at Sea ("SOLAS") will be of relevance. SOLAS introduces requirements on commercial vessels engaging in international trade relating to the design, construction, maintenance and operation of the vessel. SOLAS does not yet contain specific regulation relating to hydrogen (other than ammonia) as a fuel. As a starting point, vessels are to be designed and constructed in accordance with the rules specified through SOLAS chapter II-1 Part A-1 Regulation 3-1, which refer to the rules of a classification society approved by the relevant flag state. Currently it does not contain rules on vessels designed to use hydrogen as fuel. However, chapter II-I facilitate for a so called "Alternative Design" approach, where the design process is based on a risk assessment where a vessel is deviating from the class rules, as is likely to be the case for vessels designed to use hydrogen as fuel. This Alternative Design approach will require close collaboration with classification societies, substantial documentation and additional resources compared with a normal construction process until the hydrogen fuelled vessels becomes more common, experience is gained and the class societies develops class rules for hydrogen fuelled vessels.

Ammonia as a fuel is a more developed technology, which has resulted in DNV adopting a separate class notation called "gas fuelled ammonia" available for vessels to be fuelled by ammonia. As a consequence, owners that wish to build vessels to be fuelled by ammonia can avoid the more burdensome Alternative Design approach and instead build as per class requirements for compliance with the SOLAS requirements.   

In addition, the International Code of Safety for Ships using Gases or other Low-flashpoint Fuels (the "IGF Code") provides a regulatory framework for adaption of low-flashpoint marine fuels, which will include hydrogen. The IGF Code establishes a framework of accepting that an Alternative Design approach is applied to verify compliance with SOLAS for ships using gas fuels, including hydrogen.

IMO, through the Marine Safety Committee and its sub-committee on carriage of cargo and containers are working on including fuel cells in the IGF Code. Until fuel cells are included in the IGF Code, guidelines issued by the IMO, will be of applicable for vessels powered by fuel cells. Such guidelines introducing standards for the arrangement and installation of fuel cell power installation were issued by the IMO Marine Safety Committee in late April 2022. It is worth noting that as the guidelines relates to arrangement and installation of fuel cells only, the IGF Code will still be applicable for the storage of fuel and the fuel supply to the fuel cell space on the vessel.

Use of hydrogen as fuel raises some further practical issues, that may be crucial to overcome before hydrogen can become a common fuel. One of these challenges is the storage, as there is no form of storage that combines a high density, low energy input, has all resources readily available and is non-toxic and easy to handle. Going forward, regulatory institutions and ports will need to make choices on methods of storage of hydrogen. This will again have an implication on the design process for vessels. Moreover, the volume of fuel required and the limited storage space available on board may result in more frequent bunkering than for carbon-based fuel. This leads to another challenge; the bunkering infrastructure. Currently there is limited infrastructure for bunkering of hydrogen-based fuel available. In order to make it easier for shipowners to order vessel that will use hydrogen as fuel, hydrogen needs to be readily available to bunker in the areas their vessels are trading. At the same time, in order for the bunker providers to invest in infrastructure for hydrogen, they will need to know that there is a market for the hydrogen to be used as a fuel by vessels.

As for hydrogen as a cargo, the International Maritime Dangerous Goods Code (the "IMDG Code") will be applicable to hydrogen carried as a packed cargo. Since hydrogen is likely to be transported in a liquid state (either as NH3, or as H2), the regulations in the International Code for the Construction and Equipment of Ships Carrying Liquefied Gases in Bulk (the "IGC Code") will probably be the more relevant regulation for the vessels carrying hydrogen. The regulation applies to the construction process only and not to the actual transport of hydrogen as a liquid cargo in bulk. It should be noted that the IGC Code contains regulation on use of cargo as fuel, and that it does not permit use of cargoes identified as toxic, included ammonia, as fuel. For other potential hydrogen cargoes, the classification society may accept the use of the cargo as fuel, provided that the same level of safety as when LNG is used as fuel is ensured in accordance with the IGC Code chapter 16.

In transportation of hydrogen in a liquid state, the cargo will need to be kept cool and/or under pressure. H2 requires substantial lower temperatures for storage than NH3 (-253 C compared with -33 C) and has other properties, which will be of importance both in the requirements for the vessels transporting ammonia or pure hydrogen. The particular properties of hydrogen and the state in which the hydrogen is transported as well as the potential possibility to use the boil off as fuel should be taken into account when drafting contacts for transport of hydrogen by vessels. Schjødt has substantial expertise and experience in drafting contracts to accommodate particular trades or cargoes.