Slide 1: Internal combustion engines will power maritime decarbonisation
Internal combustion engines will power maritime decarbonisation Mikael Wideskog Director, Sustainable Fuels & Decarbonisation 30 May, 2024 1 ©
Slide 2: After IMO net-zero commitment, regulatory focus has moved to mid-term measures
After IMO net-zero commitment last year, the regulatory focus has moved to “mid-term measures” For vessels operating in EU waters, fuel cost may double due to emission fees by 2030, compared to 2023 IMO GHG Strategy1) EU Fit-for-55 GHG emission reduction % vs 2008 Fuel-related costs for Handymax bul
Slide 3: Decarbonisation can be reached through different pathways
Decarbonisation can be reached through different pathways; net-zero targets will require a fundamental shift towards sustainable fuels Decarbonisation pathways Burn less fuel1) Clean up emissions1) Use alternative energy sources Vessel efficiency Operational efficiency Emission abatement Sustainable
Slide 4: Cost of emissions will close the price gap between fossil and sustainable fuels
Cost of emissions will close the price gap between fossil and sustainable fuels; fuel selection impacts the vessel structure Fuel type Low Sulphur Liquified Methanol Ammonia Liquid Compressed Marine Fuel Oil Natural Gas @ 20°C @ -33°C Hydrogen Hydrogen Battery Rack @ 20°C @ -162°C @ -253°C @ 350bar
Slide 5: Our offering can support all decarbonisation pathways
Our offering can support all decarbonisation pathways, making us our customers’ preferred business partner in their decarbonisation journey Technology Services Multi-fuel engines Hybrid systems Spare parts Electrification Maintenance Propulsion systems solutions services Voyage and fleet Performance
Slide 6: Increased R&D spending from historical average of ~3% to ~4% of net sales
To support our decarbonisation technology development, we increased our R&D spending from historical average of ~3% of net sales to ~4% 4.3% 3.2% ~2,900 258 patents and applications since 2013 165 43% of which are classified as 2018 2019 2020 2021 2022 2023 technologies that reduce or eliminate GHG
Slide 7: We develop our engine technologies in four R&D facilities located in Europe
We develop our engine technologies in four R&D facilities located in Europe Sustainable Technology Hub, Vaasa, Finland ▪ Top level research laboratories ▪ University collaboration Turku, Finland ▪ Integrated with production and services remote ▪ University collaboration monitoring ▪ Connection to ma
Slide 8: We lead in fuel flexibility and fuel efficiency
We lead in fuel flexibility and fuel efficiency, having the industry’s most comprehensive offering for alternative fuels Fuels1) 2015 2022 2023 2024 2025 LNG LNG Over 15 years of experience on field in Marine, over 30 years in Energy Diesel Methanol Methanol ▪ First ▪ Sales ▪ First Diesel retrofit r
Slide 9: LNG is still the most popular alternative fuel choice, followed by methanol
Across the markets, LNG is still the most popular alternative fuel choice, followed by methanol; uncertainty remains over long-term fuel mix Fuel uptake by segment, mCGT on orderbook ~50% Cargo of total shipbuilding orderbook is set to run on alternative fuels Containerships ~55% of passenger vessel
Slide 10: Our engines have built-in upgradability to future fuels
Our engines have built-in upgradability to future fuels, with significant part commonality between different fuel versions and a modular design LNG DF1) engine to run on: Fuel System Engine base Engine top ▪ Bio/Synthetic diesel ▪ No changes ▪ No changes ▪ No changes ▪ Bio/Blue/Green methane ▪ No ch
Slide 11: Hybrid-Electric will challenge 2-stroke as prime-mover for LNG carriers
Hybrid-Electric will challenge 2-stroke as prime-mover for LNG carriers, enabling higher efficiency and increased cargo capacity Wärtsilä Hybrid-Electric LNG carrier Launched at Gastech in 2023 with Shell and Hudong-Zhonghua Shipbuilding ~185k cbm capacity 3x 4-stroke spark-gas gensets 6% extra carg
Slide 12: Our engines can burn fuels regardless of their source
Our engines can burn fuels regardless of their source, enabling a flexible pathway towards IMO net-zero targets Sustainable fuel uptake scenario for net-zero in 20501) Total energy consumption, EJ Green fuels 15 Produced from hydrogen made through electrolysis using renewable energy Reduced energy d
Slide 13: LNG is a mature fuel, with ~2,000 ships in service and on order
LNG is a mature fuel, with ~2,000 ships in services and on order Pros LNG uptake by segment, mCGT1) - Safe to use, proven technology - ~20% reduction on tank-to-wake GHG emissions vs Heavy Fuel Oil (HFO) - No need for aftertreatment to reach Nitrogen Oxides (NOx) Tier III compliancy Cargo - Very low
Slide 14: Third-party measurements show methane slip well below default values
Independent third-party measurements show that we are well below default methane slip values defined in regulations Measurement results1) State of the art technology ▪ Standard Wärtsilä 31DF has methane emission clearly below the default factors of recent EU regulations and IMO LCA2) guidelines, whi
Slide 15: Methanol has become the preferred choice for containerships
Methanol has rapidly become the preferred choice for containerships and is expanding to other sectors Pros Methanol uptake by segment, mCGT1) - Fuel handling simpler than LNG - Very low Sulphur Oxides (SOx) and Particulate Matter (PM) emissions - Retrofit potential: easier engine and less costly con
Slide 16: Ammonia as fuel is gaining interest
Ammonia as fuel is gaining interest Pros Ammonia uptake by segment, mCGT1) - Zero carbon fuel - Very low Sulphur Oxides (SOx) and Particulate Matter (PM) emissions Cargo Cons - Toxic and corrosive Containerships - Lower energy density compared to LNG, i.e., it requires bigger volumes to Passenger st
Slide 17: Hydrogen's transportation and storage challenges will limit uptake in marine
Hydrogen’s transportation and storage challenges will limit the uptake in marine Liquid Hydrogen vs. Pros Low Sulphur Fuel Oil - Zero carbon fuel Fuel price Gross tank - No need for aftertreatment to reach Nitrogen Oxides (NOx) Tier III compliancy factor in 20352)3) size factor5) - Very low Sulphur
Slide 18: The alternative fuel ecosystem must develop to support the maritime green transition
The alternative fuel ecosystem must develop to support the maritime green transition Alternative fuel uptake at ports infrastructures Alternative fuels bunkering facilities in the world’s top 50 ports1), no. ports 30 ~60% of the top 50 ports worldwide have or plan to build alternative fuel bunkering
Slide 19: By 2030, confirmed sustainable ammonia and methanol capacity is ~2% of planned fuel need
By 2030, the confirmed global production capacity for sustainable ammonia and methanol is ~2% of the planned fuel need Projected production of sust. methanol and ammonia1), million tonnes Key considerations 200 ▪ The estimated world fleet bunker fuel consumption 2023 was ~280 million tonnes2); if th
Slide 20: Share of alternative fuel-capable engine orders is steadily growing
The share of our alternative fuel-capable engine orders is steadily growing, standing at >60% MW in 2023 Alternative fuel-capable engine order intake % 4-stroke engine orders, alternative vs conventional fuel-capable, MW 100% >3,000 LNG engines 80% sold to date 60% 40% >160 methanol engines 20% sold
Slide 21: Internal combustion engines will power maritime decarbonisation
Internal combustion engines will power maritime decarbonisation Net-zero targets will require a fundamental shift towards sustainable fuels, and multi-fuel engines provide the most flexible pathway 21 ©
Slide 22: Wärtsilä
re, WARTSILA