The maritime transport industry must convert between 5 to 10 percent of its fuel consumption to carbon-free fuels (SZEF) by 2030 to remain aligned with the International Maritime Organization's (IMO) 2023 greenhouse gas strategy. This amount is equivalent to 0.6 to 1.2 exajoules of energy, which is about 15 to 30 million tons of heavy fuel equivalent per year. This amount of fuel is sufficient to meet the needs of approximately 600 to 1200 container ships of 15,000 TEU.
Decline in Performance Indicators
However, the report notes that "overall performance indicators are lagging behind what is needed" and in some areas, progress has actually reversed. One of the main reasons for this shift is the failure to adopt the IMO's net zero framework by October 2025, which is linked to halted or canceled company decisions and decreased sentiment in financing and demand.
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The report emphasizes that opportunities have not been lost and technology and supply are still advancing. There is still a possibility of achieving high levels of SZEF production that align with the path towards net zero by 2050. However, the greater risk is that the transport industry may not have enough ships with SZEF capabilities, as legal uncertainties hinder investment. This situation could turn into a self-reinforcing cycle, where the fear of inadequate fuel supply leads owners to order conventional fossil fuel ships.
Technological Advances and Fuel Production Challenges
Technology can be the counterpoint to this pessimism. Sea trials of the first large ships powered by ammonia equipped with two-stroke engines have been successfully conducted. Additionally, the first ammonia bunkering operations from ship to ship have taken place. Companies Everllence, Wärtsilä, and WinGD have also reported new methanol retrofit offerings. Meanwhile, the number of ports offering methanol bunkering has increased from 19 to 29.
Nevertheless, fuel production is significantly behind the required trajectory. Total SZEF production in 2025 remained below 0.02 EJ, while the target was a progress of 0.10 EJ. This target is now expected to be achieved by 2028, while the 0.6 EJ target initially set for 2030 is likely to be realized between 2032 and 2035 under low and medium growth scenarios. Additionally, green hydrogen costs are still "significantly higher than the required levels" to achieve the target of $1.5 to $2.0 per kilogram by 2030.
Demand Situation and Financing
Demand shows a mixed situation. The expected delivery of container ships with methanol capability has recorded the largest annual capacity increase. The loading capacity of active methanol-capable ships has more than tripled, rising from 2.3 million to 7.7 million GT, which increases the share of SZEF capacity in the active fleet from 0.41 percent to 0.77 percent.
However, the future order book has moved sharply in the opposite direction. Ships with SZEF capability have decreased from 9.5 percent to 5.7 percent of GT orders, and orders for methanol and ammonia ships have also declined. Therefore, the shift in 2024 towards conventional fuels seems to be "a one-off pulse driven by a few large operators rather than a structural gap in ordering behavior."
The expected potential demand for SZEF in 2030 is estimated at around 0.45 EJ, equivalent to about 450 large container ships, while reaching the required 5 percent threshold requires about 600 ships. Restoring the growth trajectory prior to 2025 for SZEF orders could increase capacity to 0.70 EJ and clear this threshold, highlighting the importance of ordering decisions in the remainder of the decade.
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