ship.energy

Norsepower CEO: Wind propulsion is ‘a vast, untapped market’

In a Q&A with ship.energy, Norsepower CEO Tuomas Riski calls for more investment and united action from industry to move forward on hitting decarbonisation targets

Norsepower began as a cleantech company in 2012 promoting wind power and using 1920s technology. How willing was the shipping sector to engage in discussions about rotor sails at that point and have the discussions that you are now having with industry stakeholders changed in any way?

The shipping industry has always been somewhat conservative, however on presenting our design and idea to the industry, we secured the first pilot project as it was clear that the Rotor Sails would have the potential for real fuel savings without compromising cargo space or safety.

Since the initial pilot project, interest has only increased. It’s a sector that needs evidence, and once there was a tangible case study the industry was convinced it was a safe, robust and durable technology that would produce significant fuel savings and reduce emissions, without causing any hindrance or compromise to ship operations

At the time you set up Norsepower, was it a challenge to source funding – and are sources of finance becoming more readily available for ‘clean marine’ projects/companies?

For disruptive technology ideas, it is not often the industry itself investing in the technology at the beginning, and quite often venture capitalists or private equity investors are the initial investors in clean technology. For Norsepower, the first investors were Lifeline Ventures Oy, Power Fund II, EAKR Aloitusrahasto Oy, Valve Ventures Oy, and Korkia Venture Insight. Since then, we have received funding from the European Commission and Business Finland – the Finnish Funding Agency for Technology and Innovation.

Our most recent funding came from the Oil and Gas Climate Initiative (OGCI) last year, a pilot investment fund financed by 12 leading oil majors that aims to accelerate the industry’s response to climate change. This is the first investment provided from within the industry, but we hope to see more funding become available to support clean technology startups.

Do you think the publication of the IMO’s initial GHG targets in 2018 acted as a catalyst to accelerate the industry’s discussion about decarbonisation? 

Decarbonisation has become more and more important in the industry and throughout the world.  Regulation is of course vital, but external pressures from the likes of shippers, charterers, and the general public have accelerated the industry’s discussions and progress both within the International Maritime Organisation (IMO) and outside. The IMO is feeding the fire on a global level, but it is one piece in the global puzzle, and we need international collaboration to make a positive and significant step forward.

Where do you think shipowners are sourcing their information from about new fuel options and propulsion and technology options – is it class societies, industry organisations, technology providers – or other sources?

Class societies have a significant role in analysing new technologies and providing objective information. For Norsepower, Rotor Sails were installed onboard the tanker Maersk Pelican in August 2018 and Lloyd’s Register was involved in calculating the official emissions savings.

As part of the test, the aggregated total fuel saved from 1 September 2018 to 1 September 2019 was 8.2%, and this independent analysis from Lloyd’s Register provided the industry with a benchmark of what the Rotor Sails can achieve. This independent approval has been a catalyst for more interest and investment in our wind propulsion technology.

Technology such as Rotor Sails can cut fuel consumption and reduce vessel emissions. Do you think the technology is currently available to enable shipping to meet the IMO’s 2030 targets?

I believe the technology needed to meet the IMO’s 2030 targets is already available, it is a question of financing and reaching the desired payback levels. Investments and united action from the industry is what is needed to move forwards.

At Norsepower, we continue to make important incremental design improvements to the Rotor Sails, intending to improve efficiency and maximise savings to reach around 20%. We also acknowledge not one size fits all, and so have added different sizes to the Rotor Sail portfolio, offering five different model sizes to ensure the optimal dimensions for different vessel types and applications.

This ensures we are meeting different vessel requirements and maximising its capabilities. Combining several existing technologies with the Rotor Sail can make a huge difference to a vessel’s operations. Indeed, in good wind conditions, a sailing hybrid vessel can maintain regular service speed by sail alone, such as in the case of the Scandlines hybrid ferry.

Norsepower is working with shipping partners who are involved with alternative fuels such as LNG and also hybrid/battery technologies. Do you think this collaborative approach will enable shipping to hit the IMO’s 2050 targets?

Collaboration and communication are key to meeting the IMO’s 2050 target. There is huge potential to increase efficiency and profitability by utilising retrofits in conjunction with other efficiency measures. For example, when installed aboard the Scandlines M/V Copenhagen, the Rotor Sails sit alongside measures such as hydrodynamic hull optimisation, and a hybrid-electric propulsion system with a battery-powered energy storage system.

Combinations of different technologies can make a big impact on fuel consumption and even different processes such as slow steaming. This is one easy way to reduce emissions and combining this with other technologies will make a big difference.

Alternative fuel producers and technology providers are also competing for R&D funding. Do you think that the establishment of a maritime R&D fund as proposed to the IMO and also by the EC as part of its Green Deal is a useful step forward?

Any step forward is positive for technology development and implementation but some of the funding is not enough. We need to see bigger investments and stronger incentives to make a real difference to accelerate progress and make a significant impact. And the great news from a clean technology provider and shipowner’s perspective is that any emissions savings are also fuel savings, which means that new, costly low carbon fuels will impact the industry less.

How are the costs of rotor sail installation met by / shared with shipowners? Do you think shipowners are finding it challenging in sourcing funding in order to be ‘first movers’ in the energy transition?

All the pilot projects that we have initiated have led to the continuous usage of Rotor Sails. For instance, our first customer, the Finnish shipowner Bore, purchased the Rotor Sails, which we continue to maintain to this day, following successful sea trials.

As a company, we also offer an alternative delivery model for Rotor Sails under a ‘Pay-As-You-Save’ system. The idea is to minimise upfront investment and have a service agreement and monthly payments based on the fuel-saving that can be achieved with Rotor Sails. This has been designed to reduce the barrier to entry and provide the added benefits of a service agreement rather than a one-off purchase of a product.

What are installation times like for rotor sails – would vessels have to be off-hire for significant periods and would times vary significantly between vessel types?

After the initial preparations were made, the installation for the latest Scandlines ferry took place overnight in a matter of hours. In the fastest case, the preparation has been done during an ordinary dry-docking in less than two weeks such as for Bore, Viking Line, and Scandlines installations. It has proven that there is no additional off-hire for the installation of Rotor Sails.

Do you think the new tiltable rotor sail will open up new market opportunities to Norsepower?

Our new tilting Rotor Sail design has already opened up markets with vessels navigating height-restricted routes, such as Sea-Cargo. Additionally, vessels needing to lower the Rotor Sails to almost horizontal position during certain elements of its journey, such as lowering during cargo operations for bulker vessels, showcases how we can provide innovative adaptations to the Rotor Sail solution that fits with particular vessel requirements.

How do you see wind-assisted technology evolving and growing in the next 10-15 years?

Although there are a number of wind propulsion solutions on the market, a large proportion of these are in the prototype phase, leaving only a small number of commercial vessels utilising wind propulsion technology. However, this is a rapidly growing market and we are seeing increasing interest. We are seeing a direct correlation between demonstrated successful results in cutting costs and emissions for ship owners and operators – as well as cargo owners who often pay for the fuel – and increasing interest in utilising wind power.

The competition in the market is rising, and we welcome that other companies are also beginning to demonstrate to the industry the opportunities associated with wind propulsion; there is a vast, untapped market, which is good for us and other companies, and the planet.

Lesley Bankes-Hughes

Lesley Bankes-Hughes