31 August 2026
Alternative Fuels Availability for Shipping Industry in 2025
What are the available alternative fuels in 2025? Are shippers determined to reduce GHG emissions to meet their decarbonization goals?
By utilizing the available alternative fuels in 2025 for their maritime operations, some shippers are determined to strategically reduce greenhouse gas emissions in order to meet their decarbonization goals.
Table of Contents
A. The Quest for A Net-Zero Future in Maritime Industry
The shipping industry is undoubtedly advancing toward attaining Net-Zero emissions by 2050. However, there are some important initiatives that must be put in place for shippers to smoothly transition into using alternative fuels in their vessels. This will require certain infrastructural development as well as establishing new standards and harmonizing the existing compliance requirements.
Some of the apparent benefits of Net-Zero-emission operations for shippers are that they can stay compliant with both local and international regulations, be competitive in the market, and run a sustainable business model that can be cost-effective in the long run.
B. Key IMO Regulations & Guidelines
The International Maritime Organization (IMO), in partnership with the local agencies of its member states, has put forward some helpful regulations and guidelines necessary to facilitate shippers’ full utilization of alternative fuels. Some of these important laws and guidelines are as follows:
MARPOL Annex VI
As a major regulation under the International Convention for the Prevention of Pollution from Ships (MARPOL), this law focuses on preventing air pollution by setting limits on emissions from ships that include sulfur oxides (SOx), particulate matter, and nitrogen oxides (NOx). It equally sets up Emission Control Areas (ECAs) where stricter standards apply and makes helpful provisions for energy efficiency in terms of the Ship Energy Efficiency Management Plan (SEEMP) and the Energy Efficiency Design Index (EEDI).
SEEMP (Part I, II, III) – Latest Guide
From the year 2023, the ships subject to the CII rating will have to develop a SEEMP Part 3 (III) on or before 31 December 2022.
Ship Nerd
Carbon Intensity Indicator (CII)
Under MARPOL Annex VI of 2023, a ship’s energy efficiency is estimated in grams of CO2 emitted per cargo-carrying capacity and nautical mile. All vessels that are over 5,000 gross tonnage (GT) are expected to calculate their CII, rated from A (major superior) to E (inferior performance). Therefore, all vessels that are rated D for three straight years or E for at least one year will be requested to submit a plan to correct their actions.
How to calculate the Carbon Intensity Indicator (CII)?
Chapter B: IMO Fuel Lifecycle Guidelines (2023)
Chapter B of IMO Fuel Lifecycle Guidelines (2023) concentrates on the appropriate frameworks for evaluating the greenhouse gas (GHG) intensity of marine fuels used by ships throughout their lifecycle. This is usually referred to as “Well-to-Wake” analysis. This method estimates the amount of emissions at the level of fuel production (Well-to-Tank) to their combustion onboard vessels (Tank-to-Wake), to ensure that the goals to achieve low-to-zero greenhouse emissions are attainable.
FuelEU Maritime
Primarily applicable to vessels over 5,000 gross tonnage (GT), the FuelEU Maritime is a regulation under the European Commission’s Fit for 55 group of laws enacted to promote decarbonization in maritime transport. It encouraged the utilization of low-carbon, renewable fuels and clean energy technologies for vessels in a way that they contribute to a sharp decline in greenhouse gas (GHG) intensity over a certain period of time.
EU Emissions Trading System (ETS)
Launched in the maritime transport in 2024, ETS is considered the world’s first and biggest carbon market aimed at reducing greenhouse gas (GHG) emissions in a cost-effective manner via a cap-and-trade system. This entails that companies are expected to monitor, report, and offer allowances equal to their emissions, and the auctioning of allowances is done in accordance with the polluter pays principle. ETS is currently operational in EU countries and others, including Norway, Iceland, and Liechtenstein, and revenue from this system is used to encourage renewable energy initiatives.
Wind-to-Wake Concept for Shipping Decarbonization
Shipping decarbonization goes beyond the norm. Get up to speed with Wind-to-Wake, the updated method of lifecycle assessment for green alternative fuels.
Ship Nerd
C. The Alternative Fuels in Shipping Now
In 2025, maritime operators will have access to the following low-carbon and renewable fuels with which they can power their vessels.
Liquefied Natural Gas (LNG)
Liquefied Natural Gas (LNG) is commonly used by shippers in Asia, Europe, and North America. It has high energy density and reduces the quantity of SOx, particulate, and NOx, and particulate matter in the environment. As a transitional alternative fuel to net-zero ambitions, LNG has the capacity to reduce CO2 emissions by as much as 20-25%.
Methanol
Because of its carbon-neutrality, methanol (particularly green methanol) that is manufactured from bio-renewable sources, is considered a long-time, viable solution for attaining net-zero goals in marine transport. It can easily handled and stored at the ambient temperatures using the existing infrastructure at most ports.
Ammonia
Owing to its lack of carbon component, Ammonia, as a ship alternative fuel, produces no CO2. Like methanol, it has a high energy density and can be scaled up cost-effectively. The well-known Haber-Bosch process for producing Ammonia is stable, and the existing infrastructure can be used to handle, store, and trade Ammonia.
Biofuels
Using different types of sources such as non-food biomass, waste oils, and algae, biofuels for vessels can be produced, utilizing the existing infrastructure. Biofuels like HVO (Hydrotreated Vegetable Oil) and FAME (Fatty Acid Methyl Ester) can be used to power the usual marine engines without requiring any structural modifications. Since they are derived from various waste-based sources, biofuels can specifically reduce the rate of CO2 emissions when used in vessels.
Hydrogen
In ship engines’ fuel cells, hydrogen only produces water vapour (steam) as a by-product, thereby absolutely eliminating CO2 emissions. Since it can be adopted for any kind of vessel without necessarily making any major modifications to their engines, green hydrogen holds great promise of being a totally carbon-free alternative fuel for shippers.
D. Key Challenges in Alternative Fuel Adoption
Despite the excitement of incorporating alternative fuels into global maritime operations to increase efficiency and performance, there are still some challenges on the way to achieving net-zero carbon emissions in the industry:
Cost Competitiveness
The processes and/or technologies for producing green fuels are currently expensive. This entails that shippers will be required to make long-term investments in manufacturing alternative fuels, an action that may not produce immediate, short-term returns.
Global Fuel Infrastructure
In reality, many of the global shipping hubs don’t necessarily have the much-needed bunkering infrastructure to store, handle, and trade biofuels like hydrogen, Ammonia, and methanol.
Technical Readiness
Because of their possible methane slip and N2O emissions, Ammonia and LNG require additional technology to prevent them from causing more damage to vessels’ engines. It is also important to carry out some structural modifications on the existing ships’ engines to make them compatible with biofuels, a retrofitting exercise that can cost shipowners a lot of money.
Regulatory Harmonization
In addition to MARPOL & EU Regulations, shippers will be expected to comply strictly with some new regulations like FuelEU Maritime and EU ETS in order to ensure stability in the industry. It is equally important to harmonize new policies and regulations from different nations so as to make the industry regulatory-compliant and collaborative.
Shipowners Reactions
One of Greece’s largest shipowners repudiated global regulations to cut the industry’s greenhouse gas emissions at a shipping conference in Cyprus, insisting “oil was the future” and that future alternative fuels such as ammonia, methanol, and hydrogen were “fiction”.
“Oil will be with us for the next 100 years… There is no other energy that is so friendly and so easy to handle that can substitute. What it is hydrogen, ammonia, methanol, batteries? All this is fiction. Not only in my life, but also my son’s life.
Instead of solving the problem or helping the problem, we are simply increasing the problem… We need to explain to officials that shipping is very different to the rest of other business.”
George Procopiou, founder of Dynacom Tankers Management, Dynagas, Sea Traders
The 76-year-old founder of Dynacom Tankers Management, Dynagas and Sea Traders has ordered more than 140 ships over his career and is one of Greece’s most prominent private shipowners. [1]
E. Current Infrastructure & Availability
The progress in adopting alternative fuels by the shipping industry is applaudable, and there are currently some infrastructure built in major ports around the globe to handle these processes, such as:
- LNG bunkering capabilities
- Methanol-ready containerships
- Bunkering infrastructure to hold Ammonia is under construction
- There are currently some hydrogen fuel cells for short-sea shipping
- Bunkering infrastructure for biofuels
Takeaways
From all indications, the global marine industry is poised to achieve full decarbonization by 2050, while a great part of shipping is adopting alternative fuels in an effort to control the emissions. However, the current disruptions in world trade engineered by President Trump’s administration may bring some serious challenges to the net-zero ambition in the coming years.
See Also
How Trump’s Trade War Can Stymie the Shipping Industry in 2025
President Trump’s tariffs on goods imported from China (20%), the European Union and others are estimated to affect well over $1 trillion worth of goods being moved by U.S. trading partners.
