The era of methanol as marine fuel is here

As the shipping industry continues to seek the best possible fuel alternatives, methanol is emerging as a promising marine fuel on the sector’s decarbonization journey.

Known to be sulfur-free, methanol — if produced from renewable green sources — has the potential to bring the industry to a level of carbon neutrality.

This potential is especially important within the context of the global maritime industry’s decarbonization efforts. As the industry is approaching more stringent 2030 and 2050 environmental regulations, it needs to switch to other fuel options to power its ever-increasing vessel fleet. And that need is urgent.

There is a long list of fuels or energy carriers that could be used in shipping. Among the proposed alternative fuels, LNG, LPG, hydrogen, biofuel and methanol seem to be the most promising ones.

Between 2020 and 2021, methanol has become one of the frontrunners instead of being just one of the obscure alternative fuel options. The next few years will show us whether methanol is The Fuel that could transform shipping.

Main features

Methanol is viewed as a good alternative marine fuel due to its potential to significantly cut GHG emissions since it does not contain NOx and sulfur and PM emissions are very low.

Conventional methanol can be considered by shipowners as a mid-term solution to meet the 2030 goals.

When it comes to its price, methanol is said to be competitive with marine gasoil (MGO) in emission-control areas.

This alternative fuel is widely available at ports worldwide. What is more, the fuel has been described as easy to handle and compatible with most engine types with internal combustion.

Operational safety and flexibility are among other benefits as the fuel can be stored in an ordinary tank with few modifications.

The main feed-stock in methanol production is natural gas. Current methanol production from mega plants around the world is using fossil-based natural gas and coal as their feedstock. However, methanol could be 100% renewable, as it can be produced from a variety of renewable feed-stocks or as an electro-fuel. Here, biomass, captured carbon dioxide and renewable hydrogen are expected to play a more prominent role in future production.

A study “Methanol as marine fuel” published earlier this year highlights that future unlimited methanol production relies on direct carbon capture from the air, with hydrogen generated from wind energy or solar PV. However, this technology comes with a high production cost and capital investment.

Shipowners’ quest for methanol-powered vessels

Shipowners around the world have started to consider methanol as an alternative fuel for their vessels to cut emissions and carbon footprint.

In the past few years, a number of projects have been launched to explore methanol combustion concepts and ship fuel systems. First, the projects were centered around coastal and inland waterway vessels but the recently announced deals changed this perspective.

The first ship in the world to run on methanol was Stena Germanica. The ferry was converted to be capable of running on methanol fuel at Remontowa Shipyard in Poland in early 2015. The ship was retrofitted with a first-of-its-kind fuel-flexible Wärtsilä 4-stroke engine that can run on methanol or traditional marine fuels and began offering the world’s first methanol-powered sailings Gothenburg, Sweden and Kiel, Germany in late March 2015.

In 2016, the world’s first ocean-going ships capable of operating on methanol were delivered to Waterfront Shipping, part of Methanex Corporation. The vessels each have MAN B&W’s dual-fuel, two-stroke engines ME-LGI, which can run on methanol, fuel oil, marine diesel oil or gasoil. 

Currently, Waterfront Shipping operates a fleet of eleven methanol-fueled ships, with an additional eight 49,000 dwt methanol-powered dual-fuel tankers on order.

Following the implementation of these projects, methanol proved to be a safe and reliable alternative marine fuel, with more orders coming in.

Stena Bulk joint-venture with Proman Shipping also ordered three methanol-ready tankers with deliveries scheduled for 2022.

In June this year, Swiss company Proman Shipping ordered an additional two 49,900 dwt methanol dual-fuel MR tankers, bringing its total investment to six methanol-powered newbuildings.

In August, Danish container shipping giant Maersk made headlines with an order for eight large ocean-going container vessels capable of being operated on carbon-neutral methanol.

The 16,000 TEU boxships will be built by South Korean Hyundai Heavy Industries (HHI), with deliveries starting in Q1 2024.

Prior to this milestone order, the container shipping heavyweight ordered a feeder vessel with a dual-engine technology enabling it to sail on either methanol or traditional VLSFO.

The methanol-powered units are expected to generate annual CO2 emissions savings of around 1 million tonnes and offer “truly carbon neutral” transportation at scale on the high seas, according to Maersk.

The shipping major wants to operate the ULCVs on carbon-neutral e-methanol or sustainable bio-methanol as soon as possible.

Therefore, it is working with different industry players to ensure that carbon-neutral methanol is available in enough quantities.

By its own example, Maersk committed to solving the “chicken-or-egg dilemma” – it placed an order for methanol-ready ships, at the same time creating demand for methanol.

What will this breakthrough order mean for the (green) fuel supply chain?