As something of a stellar year for ship production, 2024 saw a 38% year-on-year increase in orders for alternative-fuelled newbuilds, totalling 515 ships, according to data released by DNV’s Alternative Fuels Insight (AFI) platform.
The AFI data suggests that container ship orders led the charge, with 69% of these orders opting for alt-fuels, predominantly (67%) LNG. Container vessels and car carriers accounted for 62% of all green-fuel orders last year, indicating that the maritime sector is taking decarbonisation seriously. The data also shows that 166 new orders opted for methanol as a fuel, comprising 32% of the AFI order book. Of these methanol orders, 85 were placed in the container ship segment.
Ammonia-fuel vessel orders were also on the up, increasing from eight in 2023 to 27 last year. However, the AFI data underscores that LNG emerged as the industry’s alt-fuel of choice in 2024, accounting for 264 orders; a significant increase on the 130 orders recorded in 2023. The data also highlights that the number of LNG-fuelled ships in service increased to 641 by the end of 2024, with a record number of deliveries (169) of these vessel types recorded in this period. DNV anticipates the number of LNG-powered ships in operation to double by the end of the decade.
This growth has been accompanied by an expansion of LNG bunkering infrastructure, with the number of LNG bunker vessels increasing from 52 in 2023 to 64 last year. However, DNV notes, there is still a demand-supply gap, which is “expected to widen over the next five years, based on the orderbook”. The class society adds: “With the EU regulatory package ‘Fit for 55’ setting requirements on a large network of ports to have LNG bunkering infrastructure, it is expected that the availability of LNG in ports will increase.”
Knut Ørbeck-Nilssen, CEO, maritime at DNV, comments: “While recent figures are promising, we must keep pushing forward. The technological transition is underway, but supply of alternative fuel is still low. As an industry, we need to work with fuel suppliers and other stakeholders to ensure that shipping has access to its share of alternative fuels. It is also important that the safety of seafarers is ensured as we make this transition. This will require investment in upskilling and training.”
DNV shortly followed up on its AFI findings with the publication of a white paper entitled Biofuels in Shipping, in which it assessed biofuels such as fatty acid methyl ester (FAME) and HVO. This paper concludes that both biofuels have significant potential for reducing GHG emissions, thereby aiding compliance with CII, EU ETS and FuelEU Maritime. However, the paper warns, widespread adoption of biofuels is limited by the availability of sustainable, affordable biomass and competition from other sectors.
In 2023, the paper notes, biofuels constituted just 0.3% of shipping’s total energy use. The paper highlights the need for shipowners to consider alt-fuels alongside biofuels, given that biofuel use in shipping mostly involves blending with traditional fuels. Going forward, it will also be important to develop technical and operational considerations for using biofuels as drop-in fuels, accounting for factors such as fuel quality, system compatibility and performance monitoring, the paper cautions.
Coincidentally, 2024 saw Singapore record a surge in alternative fuels adoption, with sales of alt-fuels surpassing 1.3 million tonnes for the first time. Figures released by the Maritime & Port Authority of Singapore (MPA) reveal increases in bunkering sales for biofuels (up 68.5% to 883,000tonnes), LNG (up 318.9% to 464,000tonnes), methanol (2,000tonnes) and ammonia (9.74tonnes).
The MPA is proactively pushing decarbonisation in its waters. For example, under the terms of the Maritime Singapore Green Initiative (MSGI), the MPA has pledged to provide up to 100% port dues concession to any oceangoing vessel calling at the Port of Singapore that uses zero-emissions fuels and technology (including battery power), zero-carbon fuel or certain low-carbon-content fuels and biofuels, until 31 December 2027.
