With shipping’s energy transition calling for huge investments in new ships, fuels, technologies and supply chains, Enova’s Rune Holmen discusses how governments can best support – and fund – maritime decarbonisation. 

Owned by the Norwegian Ministry of Climate and the Environment, Enova’s mandate is to allocate funds to projects that will help the country reach net-zero by 2050. It manages an annual budget of around $1 billion. A substantial part of this is allocated to maritime decarbonisation initiatives, ranging from battery installations to carbon capture, fuel production, and ships capable of using hydrogen or ammonia as fuel. 

In this conversation, Rune reflects on the results delivered by the funds, which have supported more than 900 maritime projects in the past 10 years. He recalls how one of the first projects – charging stations for Norway’s first fully-electric ferries – was initially dismissed by many as ‘science-fiction’, but ultimately helped build the battery value chain in the country, leading to about 45 battery-powered ferries hitting the water since. Today, such electrification projects often materialise without any public funding as they have become financially viable on their own, which he emphasises is Enova’s end goal.

Rune describes how Enova is now attempting to replicate this success with ammonia and hydrogen, with funds being allocated for production and bunkering sites at the same time as investments in ships using those fuels. He insists that a ‘whole supply chain’ approach is essential, but explains why directly financing fuel purchases to cover the cost gap between renewable and fossil fuels isn’t the best option in his view. 

With public finances around the world feeling the squeeze and many competing demands for funding, he explains how Enova selects the projects it supports – and why it will no longer fund projects to fit wind propulsion or energy efficiency on newbuild vessels powered by LNG or fossil fuels, as those would reduce greenhouse gas (GHG) emissions but fail to reach net-zero by 2050. 

Asked what lessons Enova’s experience can reveal for other countries that don’t have the same level of resources as Norway, he highlighted that even relatively small investments can make a big difference, if targeted wisely. Among his top tips: ‘think systematically and accept that this takes time’.