World - BOOK AND CLAIM FOR LOW-EMISSION MARINE FUELS
Book and claim democratizes access to low-emission fuels and can increase their adoption to decarbonize freight.
Peanut butter needs jelly, Spongebob needs Patrick, Batman needs Robin, and transportation decarbonization needs low-emission fuels. Biofuels, methanol, ammonia, and hydrogen could help slash shipping emissions, if produced in the right way. But these fuels aren’t yet widely used and have an uphill battle replacing heavy fuel oil. Low-emission fuels need book and claim to accelerate uptake.
Book and claim is a chain-of-custody model. It’s been used by the electricity sector for renewable energy for decades so let’s start there to understand the mechanics.
BOOK AND CLAIM FOR RENEWABLE ELECTRICITY
Say you want renewable energy to power your factory to lower your emissions footprint. You could either build your own power generation system, or you could buy the electricity from someone else. Money is tight and you can’t afford building your own system, so you buy the clean electricity instead. Like most businesses your factory pulls power from the regional electrical grid. The grid is powered by several power generation sources, some of which are renewable, others use fossil fuel. Once electricity is on the grid, it’s impossible to distinguish clean from dirty. If you want to claim that your factory is powered by renewable energy, how do you ensure electricity you’re buying is from a renewable energy resource like solar, wind, waves, or tides?
______________
The Liquid Grid (TLG) was founded in 2016 to study the interrelationships between energy, ocean, and sustainability. Its mission is to facilitate the transition to a sustainable blue economy using clean energy technologies by educating businesses, communities, and entrepreneurs on the latest issues, trends, and opportunities. By educating readers on these issues, it builds a community that hastens climate progress.
______________
In the United States a Renewable Energy Credit (REC) is generated, or booked, when one megawatt-hour of electricity is generated from a renewable energy source and delivered to the electrical grid. The REC is a legal instrument that can be sold or traded by the producer. A REC entitles the owner to the non-power attributes of the renewable electricity generated. So long as the clean electricity is produced and delivered to the grid, it doesn’t matter who ‘uses’ it, the benefit at the grid level is the same. If you buy a REC for your factory’s electricity, you can claim that your electricity comes from renewables even though your physical electricity may not.
BOOK AND CLAIM IN TRANSPORTATION
Companies that move their freight aboard ships (cargo owners) often want it transported with the least emissions possible to minimize their greenhouse gas (GHG) footprints. For a cargo owner, emissions from freight are often categorized as Scope 3 emissions under the Greenhouse Gas Protocol. Scope 3 is the most difficult to reduce because these are emissions produced by other companies (like vessel operators) that are part of the cargo owner’s supply chain, but not under the cargo owner’s direct control.
Outside of energy efficiency improvements, one of the best ways to lower a ship’s emissions is through low-emission fuels. But as of right now such fuels are used by less than 1% of ships in the global fleet. If a cargo owner wanted their cargo on a ship using a low-emission fuel they would have to find one of the very few ships operating, and hope that it is moving between the right ports at the right time for their shipment. Sadly it’s incredibly rare for these elements to align right now.
Book and claim for marine transportation fuels helps side-step these challenges. When a low-emission fuel is produced and consumed in the maritime sector a certificate can be booked that tracks the fuel’s journey from refinery to a vessel’s fuel tank. That certificate can be bought and sold, just like a REC.
When a cargo owner purchases a low-emission fuel certificate, it entitles them to the emissions reductions relative to heavy fuel oil which would have otherwise been used. These certificate emissions can be accounted as reductions on the cargo owners Scope 3 footprint. The purchaser of a low-emission fuel certificate can claim the benefits even if their cargo was not physically carried by a ship using the fuel; so long as the fuel was used somewhere in the maritime sector.
