WITH the rules on how to comply with IMO’s Net-Zero Framework now taking shape, despite its adoption delay, shipowners are already looking for the cheapest way to comply. Food-based biofuels may seem to be the most logical answer.

They are available on the market today, relatively cheap compared to alternatives, and can be used in existing engines without major modifications. For an industry that could be under strong regulatory pressure, this combination is difficult to ignore.

But cheap compliance can become expensive. The costs just tend to fall somewhere else: on food consumers in importing countries, on forests and peatlands, and eventually, on the shipowners and investors who have chosen the wrong fuel at the wrong moment.

Shipping currently burns around 300m tonnes of fossil fuels per year. Even a partial shift toward vegetable oil-based biofuels would represent a demand shock of historic proportions.

Research by the International Council on Clean Transportation estimates that under an IMO framework without adequate safeguards, vegetable oil demand from shipping alone could reach 140bn litres by 2035 — roughly triple the entire current global market for vegetable oil biofuels.

The consequence is concerning: global vegetable oil prices would rise, perhaps tripling. 

Those price increases do not fall equally. They fall hardest on the countries and communities least able to absorb them: net food-importing nations, low-income households and the 673m people already living with food insecurity. Shipping’s green transition risks becoming a private gain made at public expense and scaling up biofuels demand to shipping’s level of consumption would be far larger than anything we have witnessed before.

If this was not enough, using vegetable oil-based biofuels can increase net greenhouse gas emissions because of a phenomenon called indirect land-use change (ILUC). ILUC occurs when land used for growing food is used to produce biofuel feedstocks instead.

Because the demand for food persists, and because the prices of these food crops are now higher, it can become economically attractive to cut down forests and drain peatlands to make way for agriculture. This causes the carbon once stored in forests and soils to be released to the atmosphere, contributing to global warming.

Luckily, the IMO does not need to reinvent the wheel when it comes to common sense protections against these sorts of biofuels.

The EU has already designated palm oil and, most recently, soya as feedstocks with high risks for spurring ILUC. Other European transport policies, i.e. FuelEU Maritime and ReFuel EU for aviation, exclude food- and feed-based biofuels entirely.

In the US, California's Low Carbon Fuel Standard caps credits from soya, canola and sunflower oils. The International Civil Aviation Organization CORSIA programme applies quantitative ILUC emission factors that limit the amount of GHG reduction airlines can claim when using food-based biofuels. 

A shipowner who builds a compliance strategy around palm or soya-based biofuels today is not buying a solution but only locking themselves into a feedstock that could face growing legislative risk across its main markets.

The deeper problem is what food-based biofuels are pushing out. Every dollar directed toward crop biofuels is a dollar not flowing toward low-emission fuels that decarbonisation actually requires — meaning, those produced with renewable electricity. Several shipowners have ordered vessels specifically designed to run on ammonia or methanol and ports are beginning to invest in the infrastructure to support them. 

Investing in food-based biofuels will only delay this transition. 

The solutions are simple. First, cap or better yet, exclude the use of food- and feed-based biofuels from complying under IMO policies. Practically, this means classifying feedstocks like palm and soy as high-ILUC-risk under the IMO lifecycle assessment guidelines, enabling restrictions on those feedstocks in IMO regulations. Second, reward the production and use of second-generation biofuels made from wastes or renewable e-fuels.

Cheap biofuels are an illusion; someone, somewhere is paying the price through higher food prices, deforested lands and disruptive climate impacts.

Shipowners that choose those biofuels expose themselves to the risk that regulators follow the lead of the EU, California, and ICAO. So, let’s avoid this expensive distraction and design an IMO regulation that makes shipping decarbonisation truly begin. 

Bryan Comer is marine program director at the International Council on Clean Transportation