If you asked the average person which sector produces more greenhouse gases – shipping or aviation – most people would probably say aviation.
But shipping generates more greenhouse gas (GHG) emissions globally than flying does. It accounts for about 3% of global emissions; global aviation accounts for 2%.
By 2030, the International Maritime Organization aims to see emissions from shipping decrease 40% below 2008 levels and 70% by 2050.
Electrifying large ocean-going container, tanker and cruise ships is probably not an option, for the same reason it’s not a workable solution for long-haul semi-trucks.
But for ports, ferries and shorter-range vessels, electrification is viable, and two B.C. companies are leading the charge in switching them from marine bunker fuel to battery power.
Earlier this year, Seaspan Ferries Corp. partnered with Corvus Energy on a trial of Corvus’ new Blue Whale battery system – designed for larger ships – in a Seaspan cargo ferry that plies the water between Vancouver and Vancouver Island.
Seaspan has also been converting some of its other vessels, using liquefied natural gas and biofuels, and electrifying docking tugs – all in an effort to reduce its greenhouse gas emissions profile.
Meanwhile, a Corvus co-founder, Brent Perry, who left the company a few years ago to start another marine battery company, has developed a new business model for electrifying ports and other marine sector hubs, like ferry terminals.
His company, Sterling PlanB Energy Solution, has rebranded as Shift Clean Energy, developed a new subscription-based business model, inked an agreement with Yinson Holdings Bhd to electrify a port in Singapore and is set to go public next year.
Shift’s plan reduces the financial electrification risks for ports, ferry operators and other marine vessel operators by providing customers with all the necessary conversions, batteries and infrastructure. In return, customers enter an electricity purchase agreement on terms ranging from seven to 10 years.
It’s a bit like the software-as-a-service model that software companies began adopting more than a decade ago in which they provide subscriptions to cloud-hosted platforms instead of selling software installed on desktop computers.
“The economics of this model are very good for the customer,” Perry said. “We finance all the system for the customer, so it makes a lot of sense for them. They can adopt that fleet without having to deal with the ownership, the liability and the capital risk. All they have is an operational risk on a subscription basis, and they pay for their electricity as they go.
“It transforms the owner into a zero-emission user right away. So it achieves their target greenhouse gas goals well ahead of the published targets that are set out by the Paris Accord.”
Perry’s company developed PwrSwap, a rugged rechargeable battery system that can be replaced quickly. So when a vessel needs to recharge, instead of hooking up to a fast charger, discharged batteries are swapped out with fully charged ones – something that takes between three and 15 minutes depending on vessel size.
That’s not that much quicker than recharging them. A fast charger can recharge a big marine battery in about six minutes. However, “the problem,” said Perry, “is that fast-charging ages the batteries.”
Shift Clean Energy’s solution is to provide a whole bank of slow-charged batteries that can be swapped in and out of vessels or last-mile trucks operating in ports. Tethered together, these batteries can be used for energy storage and peak shaving – something that big power consumers, like ports, can use to better manage their power use and reduce their energy bills.
“You can basically gang the energy together,” Perry said. “You can have something with hundreds of megawatt hours of capacity. The battery acts like a dynamic load manager at the port itself.”
The Shift subscription business model means the company has to assume the upfront costs of the vessel conversions, batteries and charging infrastructure. That is going to require a lot of capital, which the company plans to raise through an initial public offering.
Perry said the goal would be to raise $300 million to $400 million through the IPO.
“Our plan is to go public next summer,” Perry said. “We’re working with a series of partners with the capital to participate in this.”
