Host: Jason Jacobs
Guests: Steven Henderson & Mike Carter | Co-Founders | Fleetzero
Category: ⚡ Renewable Energy | Electrified Shipping
Podcast’s Essential Bites:
[4:39] SH: “We're building battery-electric cargo ships. And our mission is to affordably decarbonize freight. […] We looked at this industry and realized there's all sorts of technical solutions that you can make ships that have zero emissions or lower carbon impact on the world, but everything that we had looked […] was going to cost a lot more. […] We realized that if folks in the West decarbonize ships and everything costs 20% more […], you might be cutting billions of people out of the global supply chain. […] Is there a technology or ways we can innovate and decarbonize ships without making your cost so much more? And […] if we want to do this in a timely manner, and actually have an impact on the climate, we can't wait for regulations to force this. We need to lead with innovation and do something that there's a pull from industry and companies want to use, because it's cheaper and it's better service and it’s green.”
[11:16] SH: “Electrifying ships is really hard. It's not obvious how you do it. If you just do […] a front level first pass math, [it] doesn't seem to make sense. And we realized that clean grid electricity is the only way to really truly decarbonize shipping that's affordable. It's just a storage problem. How do you get over the fact that batteries are expensive?”
[13:16] SH: “We looked at the energy that's stored in the fuel tanks of a ship and […] converted that to batteries and realized […] we're solving the wrong problem. There's a higher order problem. The higher order problem is you don't need to electrify that ship, you need to move cargo with electricity from China to the US.”
[13:38] SH: “There's really big ships that are actually hyper optimized around lowering fuel cost […]. And we realized that a ship that can carry 20,000 containers […] has enough fuel capacity to circumnavigate the globe and more. And the reason they do that is the fuel is so expensive, it picks one place, let's say Singapore in the Pacific, and they'll go to Singapore and they fill up there once every now and then. And they'll get the best deal. [...] So instead of hopping in each port and taking fuel, which is really expensive, they get it directly from the refinery as cheaply as possible. And the storage on the vessel is essentially free. It's just a metal tank. Once it's there, there is very little maintenance, to get free storage and expensive fuel.”
[14:23] SH: “We've got a different problem with batteries. You've got relatively cheap fuel with expensive storage. So what does it look like to operate a ship with expensive fuel tanks and cheap fuel? You can have smaller fuel tanks, and the ship may be smaller, because you don't need to have as long of a range and you might make more stops to refuel. […] We realized, okay, you can't build the fuel tank into the ship. It needs to be swappable. So we realize battery swapping was going to be necessary to run an efficient business.”
[15:00] SH: “If you separate the batteries from the ship, you can share those batteries across multiple vessels. And our technology […] enables doing this in such a way that you actually use fewer batteries to move the same amount of cargo than you would if you had a plug in model. So by doing battery swapping, we can move more cargo with fewer batteries. […] If you look at long term average freight rates […] it gives you something like five or six times higher margins than a traditional fossil fuel ship. […] But to do it, you have to think of a shipping company in a bit of a different way to solve that higher order problem. It's not about electrifying the bigger ships of today, it's about moving cargo with electricity on ships. So our model uses somewhat smaller vessels and more of them. And they share swappable batteries across a network, which is pretty different from what's out there today.”
[17:37] SH: “Our ships carry 4,000 to 5,000 containers. […] And that's more like ships have been in most of the last century. The average size of ships has increased every decade since the 50s. And that's, again, driven by fuel cost. So we're actually […] going back to the heart of the logistic system as it was built in the last century. All the port infrastructure, all the roads, everything around shipping, is actually built and designed for smaller vessels. And these really big shifts […] are actually really bad for the global supply chain. They are so big, there's only a few ports that can go into. So there's all these […] under utilized ports along the west coast in the US, for example, that […] is […] wasted infrastructure.”
[23:46] MC: “When we can electrify a ship, we can get rid of all of the diesel equipment that was previously in there. […] So when you start getting rid of all this stuff, we realize there's all this extra room for cargo, which significantly would help a shipping business. And we're still heavy in the engineering of this, trying to figure out if we can completely get rid of ballast water that we're taking from the outside into the ship. And the reason for that is invasive species. It's a big issue when you're picking up water, say in one part of the world and transporting the shipping goods to another and then dumping that water into that local environment. So there's a lot of areas that have been affected by that. And so electrification also could lend itself to perhaps getting rid of some of the ballast water and go into a more permanent ballast type of model.”
[27:30] SH: “There's […] two big things that most people miss. For one, a lot of the calculations you read [are] really based on battery data and performance that's more than five years older, more than three years old. And to be clear, this has really only become economic in the last three to five years with the improvement of certain battery chemistries being commercially available. And the other bigger one is battery swapping. Battery swapping is a difference from this being economical for 1,000 to 2,000 mile range, versus truly going across the Pacific or the Atlantic. And being able to do battery swapping and the efficiencies you get, meaning fewer batteries for the same amount of cargo moved, that's what gives us a cost advantage in long range shipping.”
Rating: ⚡⚡⚡⚡
🎙️ Full Episode: Apple | Spotify | Google (Original Title: "Startup Series: Fleetzero")
🕰️ 53 min | 🗓️ 03/24/2022
✅ Time saved: 51 min
Additional Links:
Join the My Climate Journey Community
