Ocean transport is critical to the global economy, with more than 90% of the world’s trade carried by sea on a fleet of over 60 000 merchant ships. It is like to blood in our veins – supporting our beating heart and serving our everyday function. Yet this vital activity emits over one billion tons of carbon dioxide annually, or around 3% of the world’s emissions.
The world needs to cut its emissions to avoid uncharted heating of the planet, and shipping is no exception. Lately, regulatory- and commercial forces are picking up pace in their push for sustainability, with increasingly aggressive targets being set. The International Maritime Organization (a body of the United Nations) is targeting 40% reduction in emissions by 2030, while EU promotes 55% - and most are advocating for carbon neutrality by 2050. However, the maritime industry is not yet prepared for the transition.
A ship can have a lifetime of 30 years, taking us beyond year 2050 from today. We urgently need to find the right recipe for quitting our dependence on fossil fuels for motive power of ships. A variety of alternative fuels, like hydrogen, ammonia, or methanol, have been proposed and advocated, but so far there exists no silver bullet - the main challenges being a combination of cost*, safety**, and technological viability***. As such, implementation of these alternative fuels is tied to uncertainty, questionable environmental benefits, and a premium cost trickling down to consumers, and adoption is thus slow.
*All these green alternative fuels (produced from renewable electricity) will inherently be at least 3X as expensive as utilizing electrify directly (due to losses in production, storage/liquefaction, and transportation). Further, the environmental benefit can be questioned as the magnitude of losses suggest better use cases for the electricity than to create synthetic fuels. It is also worth noting that combustion of ammonia tends to produce traces of N2O (laughing gas) which is greenhouse gas with a warming potential 256-times that of CO2.
**Ammonia and methanol are corrosive, toxic, and flammable, while hydrogen is highly explosive, makes metal brittle, and is prone to leaks.
***The fuels are generally unproven. Methanol is the most mature fuel (it has seen maritime commercial use), while ammonia and hydrogen are still at the demonstration stage.
# Electrifying the oceans
Electrification of the world fleet can address the challenge that the maritime industry faces and even has the potential to improve on status quo in terms of operational performance and economics. An electric driveline with batteries as the energy carrier ensures zero emission operation using cheap energy (electricity). It is as simple as it gets. Simplicity yields reliability, which in turn sets the scene for safe operation with limited required maintenance and low operational cost. However, batteries are expensive (and prohibitively so, if applied to the mold of traditional shipping), and electric ships thus require a new and radically different business model compared to what we have today.
# Reimagining maritime supply chains.
Traditional ships are optimized for capacity, trade flexibility and low fuel consumption (to some extent). Electric ships must be optimized to reduce the capital cost of the batteries, without compromising flexibility and reach. We achieve economy of scale not with huge ships, but with many smaller ships. Like ants in an ant colony, the strength lies in our numbers (and the logistics). The ships will operate within a network of battery charging and -swapping stations, sharing batteries across the entire fleet. Ships can make quick stops along a route (the segment distance will only increase over time as battery prices keep dropping*), eliminating the need for huge batteries on every ship and bringing down costs per unit of shipped cargo to less than a fossil fuel alternative (or any other alternative fuel for that matter).
# Changing the maritime landscape, forever.
We envision a world where all ocean transport is fully electric and autonomous. Where shipping is sustainable, seamless, and simple – the frictionless fabric of international trade.
Battery prices are dropping fast (20% reduction of price per doubling of produced unit), and battery packs for electric vehicles have now dipped below 100 USD/kWh (which is generally accepted as the critical price point for wide adoption of electric cars). Nonetheless, maritime battery packs are currently ~5X more expensive than for cars (for no obvious reason, except lack of scale). As an example, at a 100 USD/kWh price point, electric ships would be at parity with conventional ships for distances up to at least 500 nm. The advances in price and performance of batteries, driven by the electric vehicle-industry, make battery-electric ships possible.
To enable wide adoption of fully electric ships, we need to undertake three major engineering tasks.
drastically reduce costs of maritime batteries,
optimize design of the ship for fully electric operation, and
reduce operating costs of the ships through automation.
We have allocated the three tasks into three separate projects: ZENERGY, zSHIPS and OCEANEYE.
We view the projects as business units, with stand-alone products and brands that in themselves can scale into large revenue-generating operations. By doing this, we achieve two things: we develop the technology we need in-house, and at the same time we generate funding to support our vision.