Biofuels gaining ground but price and scarcity a risk
Owners should check their specifications to avoid technical mishaps
Biofuels are expected to gain in popularity driven by emissions regulations, but shipping will struggle to find enough of them at the right price over time
BIOFUELS’ moment is coming, but it may not last, according to DNV.
The class society said biofuels offered significant benefits in cutting emissions and complying with emissions rules like the Carbon Intensity Indicator, the EU Emissions Trading System, and FuelEU Maritime.
More than 60 ports have bunkered biofuel since 2015, with supply concentrated in Europe and East Asia.
“Biofuels present a promising decarbonisation option for shipowners, and it’s encouraging to see steady growth in the number of bunkering ports offering biofuels in recent years,” said DNV Maritime chief executive Knut Orbeck-Nilssen.
“However, the long-term future of the maritime biofuel market hinges on the availability of sustainable biomass at an affordable level, as well as competition with other sectors.”
Global production of liquid biofuels — ethanol, fatty acid methyl ester and hydrotreated vegetable oil — reached about 111m tonnes of oil equivalent in 2023, and biogases about 41m tonnes of oil equivalent.
Shipping uses a tiny share of this: 700,000 tonnes of oil equivalent, or 0.6% of global supply, while road transport consumes 98.9%. About half is bunkered in Singapore and Rotterdam.
Most demand from shipping today is voluntary. But upcoming GHG regulations from the EU and the International Maritime Organization are expected to increase the share.
“On the other hand, supply-side constraints such as sustainable feedstock scarcity, competition with other sectors and logistical challenges will negatively impact the size of the marine biofuel market,” DNV said.
DNV said interviews and surveys suggested technical challenges were also a factor to consider.
“The technical compatibility of FAME and HVO with onboard systems varies from ship to ship, making it essential to assess each case individually,” it said.
“FAME, in particular, poses some challenges compared to standard oil fuels, especially for stability (degradation), corrosivity, and cold flow properties.”
Industry feedback indicated few significant problems when using both blends and pure biofuels, provided the transition was well-planned and executed.