It is almost a year and a half since Samskip received 15 million euros in support from Enova to build two hydrogen-powered container ships - SeaShuttle 1 and 2.
The support covers just under 40% of the additional costs for building emission-free container ships versus traditional fossil-fueled vessels.
- We have now passed the initial stage where journalists and potential customers want to hear about hydrogen-powered ships and how large they are, says Are Gråthen, Regional Director for Samskip Norway.
For Gråthen, hydrogen-powered ships are no longer news.
- We are in a mature phase where our message is about why we're doing this. What drives Samskip to invest and take risks? What can we offer the container market?
For Samskip, the goal goes beyond building emission-free ships.
- What drives us is the desire to develop multimodal container transport most economically and sustainably. The ships must use green fuel and run emissions-free. But building energy-efficient vessels that use significantly less energy than today's ships is even more critical. There's not enough energy in the world to produce renewable fuel for everything that will be built, says Gråthen.
The SeaShuttle project is attracting attention as a pioneer in sustainable shipping - where green corridors are a hot topic.
A green corridor is a route where the entire voyage has zero emissions, including electric trains or zero-emission trucks transporting goods to and from the port.
Hydrogen at a reasonable price
With contracts signed and money paid to the shipyard, Gråthen and Samskip are fully committed. The first steel will be cut in February 2024.
- We’ve reached the point where there's no turning back, even if we wanted to. The race for hydrogen production and delivery - at the right price in the right place - is on! And Samskip is working closely with several potential providers who believe they will be ready by the end of 2025.
Gråthen believes concerns about access to reasonably priced hydrogen will be resolved. Still, it will be slightly more expensive for customers, at least in a transitional phase with competition from fossil transport solutions. Samskip will soon decide whether SeaShuttle will operate on liquid or compressed hydrogen. The company is talking with several potential hydrogen producers.
- Enova has recently allocated money for several hydrogen projects (including Viasea), so there will certainly be more players in the field. A CO2 tax for shipping, starting in 2024, will contribute to increasing the cost of fossil fuel transport. We estimate that we will be competitive while at the same time communicating to our customers that they must expect to pay a little more for this solution.
Requirements for ports
Gråthen expects ports to prioritize green ships when they call to unload and load. SeaShuttle 1 and 2 will have capacity for 365 containers, of which an estimated 200 will go to Oslo.
- We build ships that will travel at lower speeds to save energy. We'll spend less time in the harbor and more time at sea. In both Oslo and Rotterdam, I have said that the most important thing ports can do is prioritize sustainable solutions.
For Gråthen, efficient cargo handling is perhaps even more important than the price and must be available 24 hours a day.
- We must have a minimum of twenty-five containers on and off per hour. I told Yilport they must have one queue for emission-free trucks and one for fossil-fuel trucks.
Gråthen does not expect to be able to bunker hydrogen at the container terminal in Oslo.
- I don't see the need for a large hydrogen tank in Oslo. Each port cannot provide every type of fuel in any case. Five or six hydrogen projects in Oslofjord will compete for that service. We are talking to several suppliers about potential locations for bunkering or exchanging fuel containers. We prefer solutions where fueling can occur parallel with the loading operation and with minimum deviation from our route.
The role of ports – efficiency and sustainability
Port of Oslo aims to be the world's most efficient and environmentally friendly urban port. Emission-free Oslofjord is an environmental collaboration between the ports of Oslo, Drammen, Moss, Borg, Larvik, Grenland, Kristiansand and Arendal. Together, we work to remove technical and financial barriers related to shore power and renewable fuels.
- It's too early to say whether we can offer hydrogen at Port of Oslo. We can promise priority for green ships regarding unloading operations and pricing. We will cut emissions by 85% by 2030. We follow the principle that polluters must pay. Eventually, it will become more expensive to pollute. It's also appropriate to reward green ships through reduced port fees, says Ingvar M. Mathisen, Port Director in Oslo.
At Yilport Oslo, unloading and loading operations are among the most efficient in the world.
- We almost always use two sea cranes per ship. We average twenty-five containers per hour per crane. With two cranes, we can handle fifty containers an hour, says Bjørn Engelsen, Terminal Director at Yilport Oslo.
A truck spends an average of ten minutes inside the terminal to deliver or collect a container.
- We have one of Europe's, and probably one of the world's, fastest truck turnaround times. We prioritize truck efficiency almost on par with ships, even though shipping companies pay for cargo handling. Truck flow is not a problem. If it becomes an issue in the future, we will try to facilitate environmentally friendly alternatives, says Engelsen.
Regulations and safety
Are Gråthen has worked on the SeaShuttle project for five years. Regulations remain a challenge.
-The regulatory aspect is one of the biggest challenges for this project. However, both the classification and insurance companies have followed the project throughout. I have received very clear signals that we will overcome any potential issues, says Gråthen.
The IMO has already come a long way in promoting hydrogen as a ship fuel.
- In November, we will present our plans to the flag state. It would surprise me if they suddenly say this won't work because there are no surprises here. Hydrogen is a mature technology used since the 1950s, just not as fuel on ships.
Oslo - Rotterdam
Samskip plans to establish the first green corridor between Oslo and Rotterdam because it is the largest container trading route in and out of Norway.
- Rotterdam is the world's largest port. Port of Oslo handles imports for a market of five million people. That corridor provides the rationale for building ships with sufficient volume and quick turnarounds in port. Our customers require us to call at Oslo twice a week so they can use short-sea container transport instead of trucks, says Gråthen.
Gråthen also points out that proximity and sailing conditions in Oslofjord are favorable.
- Six hundred and fifty nautical miles is manageable for a hydrogen-powered ship. Oslofjord is beautiful to sail in; there is not a wave here, and so limited amounts of energy are required.
One customer – Large Volumes
At this time, Samskip has a single customer who says they will use Samskip's green corridor.
(Other customers are waiting to see what the service will cost.)
Gråthen has a handshake agreement with John Christensen, Manager, Transport & Deployment at Coca-Cola Europacific Partners Norway (CCP Norway).
- It is critical for our company to achieve our sustainability goals. To reach our targets, we must shift the transport of goods to zero-emission solutions. That is why I am placing my order for the hydrogen ship now because, in two years, that space will not be available. I want cargo on the first departure. That is my intention, says Christensen.
Christensen is responsible for international logistics for Coca-Cola in Norway. He transports six thousand 40-foot containers by sea from the continent to Oslo annually.
This volume is aseptic Coca-Cola products that require separate production lines - for example, iced tea, sports drinks, and other non-carbonated products. (Traditional Coca-Cola products for the Norwegian market are produced locally at Lørenskog).
Five years ago, 100% of these goods traveled by truck from the continent. Since then, Christensen has transferred more than 90% of the volume to the more energy-efficient and environmentally friendly sea route.
- No one knows what sea transport with hydrogen-powered ships will cost. If you assume it will be significantly more expensive, you are being too negative. Why should it cost more? There will be an investment cost, but we are talking about making all the other factors more efficient. Then I think the operating costs will be acceptable. Rail transport is not an option because it already operates near full capacity. The alternative is more sea transport, says Christensen.
98% of CCEP Norway's emissions are indirect via subcontractors (ref. Scope 3).
John Christensen first became aware of Samskip's hydrogen project at Nor-Shipping 2022.
- I stood on stage and told the transport industry we will cut emissions by 30% by 2030. If I can't deliver on those targets, I'm out! However, Coca-Cola does not have transport equipment - the subcontractors do. I said I'm open to meetings, but don't come and show me today's solutions. Then Are Gråthen came on stage and demonstrated he has the solution for the future, explains an enthused Christensen.
CCEP Norway accounts for just 1% of CCEP's international emissions.
- Even if we're a small part of the emissions, it's important to show what's possible. Norway is a pilot project. When we establish the green corridor between Oslo and Rotterdam, I can use this as an example internally in the company and show what is possible. We're not saving the planet, but everything counts. Norway has made great progress in the green shift - now it's about getting the entire value chain in place.
A real Coca-Cola Zero
In September, Oslo and Rotterdam signed a memorandum of understanding (MoU) on maritime cooperation to achieve a green transition.
The MoU encourages Port of Oslo and Port of Rotterdam to share relevant solutions and knowledge concerning the green shift. "Cooperation and exchange of experience will facilitate faster progress and better processes," the agreement states.
- I can't wait until I can drink a real Coke Zero in Oslo - with zero sugar and zero emissions! said former city councilor for Industry and Public Ownership, Rina Mariann Hansen, in connection with the signing.
Support from the new city councilor
Anita Leirvik North, the new city councilor of Culture and Business Development, is pleased to see a formal collaboration between Oslo and Rotterdam.
- It is environmentally friendly when goods for business and consumers arrive by sea. As city councilor for the port, I want us to work with the business community to shift shipping to emission-free energy transport, powered by clean energy sources. Shore power at the quay is the first step, but we also want emission-free sailings. I am pleased to see a formal collaboration between Oslo and Rotterdam. A dialogue with Rotterdam, which has Europe's largest container port with fixed weekly routes to Oslo, allows us to familiarize ourselves with the barriers and challenges that remain to bring about a transition to emission-free transport between the continent and Oslo, says North.
Infrastructure ensures green corridors
Shipping companies investing in the green shift need common standards. They want to see the same technical solutions in, for example, Rotterdam as they do in Oslo.
That is why Port of Oslo is working with Port of Rotterdam to develop similar shore power facilities for smaller container ships as the ports in Oslofjord.
- Now is the time to extend collaboration to green fuels. With Rotterdam, we can facilitate infrastructure that ensures green corridors in Oslofjord and on the continent, says Port Director Mathisen.
For Are Gråthen and Samskip, ports and shipping companies must cooperate by promoting sustainable solutions.
- I've worked in this industry for 30 years. It's the first time I've stood with a customer, two municipal councils, and port directors and discussed the content of a MoU. If we don't establish a green corridor now - when politicians, port directors, and classification companies are involved - then I don't understand anything, says Gråthen.