October Biofuels Summary

In comparison with road transport biofuels and sustainable aviation fuels (SAF) the maritime biofuel industry is at a relatively early stage of commercial maturity. However, with around 260 million tonnes of fuel consumed in 2023 it represents an important decarbonisation target and commercial opportunity for low carbon fuel producers.

The course for sector development has been set and charted through the International Maritime Organisation’s (IMO) Net-Zero Framework (NZF). The Framework describes technical and economic measures designed to put the global shipping sector on a course to net-zero emissions by around 2050. The framework has been approved in principle but political pressure from high profile opponents has so far blocked formal adoption and prevented the framework coming into force. Negotiations are ongoing with hope of a decision within months.

Although the sector currently lacks the regulatory certainty provided by established national mandates for road transport and aviation fuels, companies and organisations continue to push development, investing in fuel trial and infrastructure projects.

The maritime sector has a wide range of fuels to choose from, with low carbon methanol and ammonia being two widely discussed and investigated options. Ethanol, an extensively used road transport fuel and promising intermediate for aviation fuel production is also compatible with methanol dual-fuel marine engines. A recent report from the National Laboratory of the Rockies looks at fuel and engine requirements, the need for supply chain infrastructure development, supply chain volatility, and the costs associated with ethanol use. Based on the methanol dual-fuel ships in operation today (around 115 vessels) the report identifies an annual demand for 6 million tonnes or 2 billion gallons of ethanol.

The potential for ethanol is translating to infrastructure and fuel use trials. In October Golden Island completed largest single bioethanol bunkering operation undertaken globally. In Singapore’s first bioethanol bunkering operation, approximately 5,000 tonnes of ISCC-certified bioethanol were transferred to Maersk’s dual-fuel container vessel Maersk Halifax. The gathered operational data will support the development of technical standards and procedures for future commercial ethanol bunkering.

October also saw Maersk successfully complete the first US marine bunkering operation using 100% bioethanol, with its container vessel Tangier Maersk sailing from Houston to New York powered by a WinGD X82DF-M/E dual-fuel engine.

The breadth of fuel options available to the maritime industry is further exemplified by Singapore’s Maritime and Port Authority coming together with partners to advance liquefied biomethane as marine fuel. Liquefied natural gas is an established marine fuel in Singapore and biomethane presents a lower-emission fuel opportunity as part of Singapore’s multi-fuel bunkering capability.

Despite continued regulatory uncertainty, the maritime sector is demonstrating real interest in adopting low-carbon fuels. However, translating these early developments into a mature global market will require greater regulatory certainty, investment in bunkering infrastructure and access to competitively priced sustainable fuel supply.