Britannia P&I Club has issued its Alternative Fuels Watch report, exploring current fuel innovations and regulatory changes aimed at reducing emissions in shipping.
As explained, Britannia’s report serves as an update on the current landscape of alternative fuels within the maritime industry, delving into various sustainable fuel options that are gaining traction, including biofuels, liquefied natural gas (LNG), methanol, ammonia, and hydrogen. Thus, the Club provides the following analysis regarding each fuel option:
Biofuel
Operational/built: N/A
On order: N/A
Fatty Acid Methyl Ester (FAME) and Hydrotreated Vegetable Oil (HVO) are two biofuels popular for their status as a “drop-in” fuel. Both help reduce carbon emissions; however, HVO is generally more costly.
Methanol
Operational/built: 34
On order: 244
Methanol, primarily derived from natural gas, is becoming increasingly popular in the fuel industry. Its appeal lies in simpler fuel handling and easier risk management compared to LNG. However, methanol is not without drawbacks, including its toxicity and low flash point.
Ammonia
Operational/built: 3
On order: 26
Entering into a relatively new space, ammonia has been identified as another promising alternative fuel to decarbonise the maritime industry. It produces almost zero carbon emissions when burned (besides pilot fuel) and is generally available in regions with agricultural and industrial demand. However, ammonia poses challenges due to its toxicity, flammability (though it is difficult to ignite), and the complex storage and handling requirements.
Hydrogen
Operational/built: 14
On order: 29
Hydrogen, another alternative fuel identified as clean and abundant, is attracting significant investment in technology. Fuel cells using hydrogen are more efficient than combustion engines. The production of hydrogen remains energy-intensive, and large-scale production is expensive. The bunkering infrastructure for hydrogen is still undeveloped, and storage is costly, requiring temperatures of -253°C.
The latest developments in the industry:
Biofuel
Recent developments in marine biofuels, particularly FAME and HVO, are making significant strides in decarbonising the shipping industry. For example, a group has adopted HVO for all its port towing operations, reducing CO2 emissions by up to 80%. They plan to fully transition their fleet to this renewable diesel by the end of 2024, marking a major step in sustainable marine fuel adoption.
Meanwhile, a pilot project in Singapore is testing a blend of FAME (~24%) and very-low-sulfur fuel oil (VLSFO) for bunkering, reflecting growing interest in biofuel used to meet decarbonisation targets.
Methanol
Methanol has been gaining traction as major players invest in methanol-fuelled vessels to comply with future emission regulations and sustainability goals. This interest is driven by methanol’s potential to meet low-emission targets and its compatibility with existing infrastructure, making it a viable option for reducing the carbon footprint of shipping operations.
In addition, some companies are pushing innovation by ordering the world’s first battery-electric tug with methanol-dual fuel engines (for backup) to maximise efficiency and further reduce carbon emissions.
LNG
LNG continues to dominate the marine fuel landscape as a leading option for reducing emissions, especially as shipowners look for immediate and practical solutions to meet environmental regulations. In an article by Drewry, over 1,100 LNG-fueled vessels are expected to be in service by 2029, solidifying LNG’s role in the decarbonisation of the shipping industry.
There is also a growing focus on transitioning from fossil LNG to bio-LNG and e-LNG, which are produced from renewable sources, further enhancing the sustainability of LNG as a marine fuel.
Somewhat related but rather niche, ethane carriers, designed with engines capable of consuming the ethane cargo they transport, have emerged more recently in response to the increasing production and export of ethane.
Ammonia
Ammonia-powered vessels are advancing quickly, with Fortescue conducting a groundbreaking trial in Singapore using ammonia in combination with diesel as marine fuel. This trial showcases ammonia’s potential as a clean alternative while supporting ongoing efforts to refine safety protocols and reduce emissions.
And more recently, in September 2024, the world’s first ship-to-ship transfer of ammonia was successfully conducted in Western Australia, marking a key milestone in enabling ammonia as a practical marine fuel. This fuel transfer, involving approximately 2,715 tonnes of ammonia, represents a significant step towards decarbonising large vessels, such as iron ore carriers, in the global shipping industry.
The IMO‘s CCC 10 finalised interim guidelines for the safety of ships using ammonia; these are expected to be approved at MSC 109. Additionally, amendments to the IGC Code regarding ammonia cargo as fuel are anticipated to enter into force on 1 July 2026, with early implementation possible. Supporting guidelines will be developed before CCC 11 next year.
Hydrogen
In September 2024, a company delivered its first maritime hydrogen fuel cell system for the hybrid passenger ship in Japan, which uses both hydrogen and biodiesel. When powered solely by hydrogen fuel cells, the vessel achieves zero emissions, showcasing hydrogen’s potential for greener shipping solutions.
There has been research and development in incorporating advanced sail technology to create, store, and transport green hydrogen using offshore wind energy. Ideally, the ship operates without fossil fuels, generating hydrogen through the electrolysis of seawater. This hydrogen is then converted into methylcyclohexane (MCH) for safe storage.
As a hydrogen carrier, MCH is easy to handle, efficient, and safe for storage and transportation at ambient temperature and pressure. The ship’s production also aims to supply hydrogen energy for land-based applications to achieve zero emissions.
