Shipping Risks Falling Short of Green Fuel Targets as 2030 Approaches

With 2030 fast approaching, international shipping is at greater risk than ever of missing its target of 5 to 10 percent of its energy supplied by zero- and near-zero greenhouse gas fuels, threatening the industry's net-zero goal by 2050, according to a new report. Published by the UCL Energy Institute and Getting to Zero Coalition, the report points to several factors slowing uptake, including regulatory uncertainty, geopolitical turmoil and energy security concerns. It offers a realistic look at the availability and scalability of green fuels.

 

The Central Warning

 

A new report warns of a shortfall. Shipping risks missing its 2030 target. This concerns green fuel adoption. The target is 5 to 10 percent of energy. It should come from zero-emission fuels.

The risk threatens broader goals. It endangers the net-zero goal by 2050. The IMO set these targets. This was in its 2023 strategy. The report highlights the growing risk.

 

The Factors Behind the Slowdown

 

Several factors are slowing adoption. Economic slowdown is one. Geopolitical turmoil also features. The Strait of Hormuz crisis contributes. Energy security concerns add to this.

Regulatory uncertainty is central. The IMO failed to adopt a key framework. This was its Net-Zero Framework. It will be revisited later this year. This uncertainty has slowed progress.

 

The Scale of the Target

 

The report quantifies the target. Reaching it requires substantial fuel. This means significant energy from scalable fuels. It equates to millions of tonnes. This is in fuel oil equivalent terms.

The scale is considerable. It equals hundreds of large container ships. These would burn green fuels. This illustrates the challenge. It underscores the effort required.

 

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The Progress Made

 

The industry has marked milestones. These include first ammonia-fuelled ships. First ammonia bunkering also occurred. Engine designers expanded their portfolios. These cover multiple alternative fuels.

Technology readiness is advancing. Dual-fuel engines are progressing. Retrofit kits are also developing. Battery technology is gaining traction. Electrification continues to advance.

 

The Ordering Shortfall

 

Ordering patterns pose a challenge. Regulatory uncertainty has shifted appetites. Owners favour conventional newbuilds. Only 28 percent of orders can use alternative fuels. This is well below what is needed.

This creates a projected shortfall. Only a third of needed demand would materialise. This is by 2030. The shortfall amounts to millions of tonnes. It equals hundreds of container ships.

 

Significance of the Report

 

The report offers a realistic assessment. It examines fuel availability and scalability. It covers green ammonia and methanol. It takes a candid view. This informs the industry's outlook.

The report points to a path forward. Company leadership cited policy push. Accelerated action could still deliver. Adopting the framework would help. This would allow acceleration to begin.