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H2020

LoCOPS Report Summary

Project ID: 711235

Periodic Reporting for period 1 - LoCOPS (Low Cost Onshore Power Supply (LoCOPS))

Reporting period: 2015-12-01 to 2016-05-31

Summary of the context and overall objectives of the project

Onshore Power Supply (OPS) is the delivery of shore side electrical power to a ship at berth while its main and auxiliary engines are turned off. The use of OPS to replace the use of the auxiliary engines will lead to significant reduction in local air pollutants and, with the use of renewable energy source, the greenhouse gases emissions can be reduced to a minimum. By supplying electricity from shore rather than electricity generated by the ship’s auxiliary engines, the OPS system reduces significantly the environmental impact. Not only does the system save consumption of fuel and the associated air pollution but it also eliminates acoustic noise and vibrations from the running engines.

The structures behind the unfavourable operational and capital expenses that so far have been hindering the deployment of OPS are about to change, partly driven by new EU legislation, partly by the advantages exploited by this proposal. Today’s high operational expenses are due to a tax disadvantage on shore side electricity compared with tax-free bunker-fuel available for ships. Because of this, the European Commission in 2007 opened up a process for exemptions from energy taxes for onshore power and in 2014 the legislation was ready to be implemented in the first member state.

Comparable trends have been seen within the wind power segment in the past where, over time, the total cost of wind turbines has been lowered with great success to compete with fossil fuels. Danish SME PowerCon (PC) have for the last 7 years been part of this success, by adding significant savings into the industry with competitive power solutions. Based on the comprehensive knowledge and expertise generated through the development of highly competitive solutions for the wind industry, PC has initiated the development of a very cost-effective OPS solution for ships. This solution is based on power converters for wind turbines and can, with a few alterations, match OPS international standards.

The main objective of this report is to:
• Refine OPS strategy through market and desk research
• Review industry requirements and standards
• Select end-users and develop the innovation project plan to a level ready for initiating execution

Work performed from the beginning of the project to the end of the period covered by the report and main results achieved so far

The work performed has been divided into three objectives:
T.1 Refine OPS strategy
• Analyse market proposition, competition and segments
• Conduct user surveys and refine end-user requirement
• Establish optimal configurations
• Evaluate best suitable business model and assess possible partnerships for market introduction
T.2 Technical feasibility study
• Technical requirement gap analysis of OPS system requirements
• Assess and evaluate systems and components
• Conduct preliminary cost benefit and LCA on selected end-user
T.3 Prepare the innovation project
• Set up agreement with the end-users to be involved in the innovation project
• Complete the business plan, including IPR assessment and route-to-market strategy
• Develop the innovation project plan to a level ready for execution

Based on our user survey the most important element for the end-user to install OPS is either a positive business case, which means low CAPEX combined with electricity cost below the ships internal AE cost, or new stiffer requirements from legislation. We found that the tendency of building larger cruise ships seams to continue requiring more power capacity of the OPS systems. IEC 80005 recommends a rating between 16-20MVA.
Most of the cruise ships are 60Hz causing the need for a frequency converter. Having a frequency converter in the system also enables the system to perform 50Hz if required.
The lager cruise ships are made with 11kV internal electrical grid. The use of 6,6kV on smaller ships is accompanied with corresponding lower power demand.
Having a variety of cruise ships entering the ports are causing different OPS hatch connection locations. This calls for a mobile cable management solution.
Due to the foreseen future with more and bigger ships, the possibility of upgrading the system to handle more and/or bigger ships at the same time is important for the port.
The proposed innovation project is expected to follow an overall work plan structure, consisting of 6 work packages leading to the end goal of having the novel OPS demonstrated at the end-user ready for commercialisation and production ramp-up.

Progress beyond the state of the art and expected potential impact (including the socio-economic impact and the wider societal implications of the project so far)

The use of Onshore Power Supply (OPS) to replace the use of the AE will lead to significant reduction in local air pollutants and, with the use of renewable energy source, the greenhouse gases emissions can be reduced to a minimum. Nowadays ports are seldom equipped to supply vessels with electricity from the shore-side, nor are vessels usually equipped to receive power in this way. Around the world, though, many activities in this direction are now underway and interest in the technology is rapidly growing, spurred on by tougher environmental legislation, greater focus on emissions in ports from shipping, rising fuel and lower electricity cost through tax exemptions.

The novelty of our innovation business case is to use our competitive edge from a highly competitive segment in a new emerging segment. So far, the combination of high CAPEX and OPEX undermines the port’s business case in deploying OPS. However, the recent development in tax exemption gives the port and/or cruise ships an opportunity for a positive gross margin on shore side electricity. Thus, with a sufficiently high consumption and sufficiently low cost OPS, a business case will emerge. Due to the high power consumption of cruise ships, combined with our low cost OPS solution, for the first time a positive business case emerges for the cruise ship ports.

Estimates show that if all ships in European harbours would use OPS by 2020 for covering their energy demand at berth, they would consume 3,543 GWh annually, which is approximately 0.1% of the electricity consumption in Europe as a whole in 2012. Furthermore, OPS offer the potential to mitigate 800,000 tons of CO2 emissions. Cruise ships account for 38% of these numbers. Thus, the expected impact of OPS and thus of this project by making a commercial business case for ports possible, are significant and affect many stakeholders, such as the ports, cruise ship operators, municipalities, urban populations, etc.

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