Abstract
Alternative fuels and fuel-flexible ships are often seen as promising solutions for achieving significant greenhouse gas reductions in shipping. We formulate the selection of alternative fuels and corresponding ship power systems as a bi-objective integer optimization problem. We apply our model to a Supramax Dry-bulker and solve it for a lower bound price scenario including a carbon tax. Within this setting, the question whether bio-fuels will be available to shipping has significant effect on the lifetime costs. For the given scenario and case study ship, our model identifies LNG as a robust power system choice today for a broad range of GHG reduction ambitions. For high GHG reduction ambitions, a retrofit to ammonia, produced from renewable electricity, appears to be the most cost-effective option. While these findings are case-specific, the model may be applied to a broad range of cargo ships.