The LNG pathway offer the lowest cost of regulatory compliance of all alternative marine fuels and delivers strong returns on investment.
LNG offers the lowest cost of regulatory compliance.
In terms offleet operations LNG dual-fuel vessels are the lowest cost option for ensuring overall fleet compliance with EU and IMO decarbonization regulations.
LNG dual-fuel vessels provide the lowest cost of compliance solution with current and proposed EU and IMO decarbonization regulations. This is driven by the fact that LNG, in its fossil form, has lower GHG emissions than VLSFO, so fleet operators can avoid using the large quantities of expensive green fuels that ammonia and methanol dual fuel vessels would require for compliance.
Initial modelling of a 14,000 TEU container vessel under the IMO’s proposed Net Zero Framework, EU ETS and FuelEU Maritime, using the Z-Joule investment analysis tool, shows that LNG dual fuel engines offer a relative payback period of about 3 to 4 years compared with VLSFO because of lower compliance costs due to LNG’s lower carbon intensity, or GFI. By way of comparison, ammonia and methanol dual fuel vessels offer paybacks of 12 and 10 years, respectively.
The optionality LNG dual-fuel vessels provide, through fuel switching, protects investment returns amid fluctuating regulations and fuel prices. Longer term, LNG dual fuel engines are particularly suited to onboard carbon capture, as these technologies mature.