The shipping industry, a pillar of global trade that moves the vast majority of goods by sea, is experiencing a moment of retreat regarding its environmental strategies.
Responsible for about 3% of total global CO2 emissions and 11% of those generated by the transport sector, the world of merchant shipping had ridden the wave of the ecological transition in recent years.
However, data from the latest annual survey by the International Chamber of Shipping, reported in a new report by the Financial Times, reveal a change of course: confidence in “green” fuels such as ammonia and hydrogen has collapsed, while support for traditional fossil fuels is growing. At the same time, more radical solutions are emerging, such as nuclear propulsion, and hybrid approaches.
This retreat is not only the result of technical and economic difficulties but also reflects a tense geopolitical context that has weakened the ambitious goals of the International Maritime Organization (IMO).
Overall, the sector appears more cautious, divided between realism and the need to reduce emissions, at a time when shipowners are increasingly unwilling to pay a “green premium” for cleaner transport.
Decline in confidence in fuels of the future
The first significant data from the new International Chamber of Shipping survey concerns the collapse of the belief that ammonia could become a commercial solution within the next decade: among the executives interviewed, this confidence plummeted from 31% to 12%. For hydrogen, the drop was from 18% to 10%.
These figures reflect an obvious reality: affordable costs and supply availability weigh much more than environmental concerns.
Shipowners face an uncomfortable situation: infrastructure for these new fuels is still insufficient and prices are still too high to justify massive investments in ships that will have to operate for two or three decades.
The resilience of fossil fuels
On the other hand, confidence in traditional fossil fuels has risen from 41% to 50%, despite repeated crises that have affected supply chains, including tensions related to the situation in Iran.
Many operators, especially Greek shipowners who control about a fifth of the world merchant fleet by tonnage, are opting for new builds powered by fossil fuels, focusing on the efficiency of modern ships that can cut consumption by up to 25%.
As Ioanna Procopiou, chief executive of Prominence Maritime, emphasized, “energy will be scarce anyway, so we must focus on how to reduce our overall footprint.”
This approach favors incremental and immediate improvements over still premature technological revolutions.
The scaling back of the net zero goal
On the institutional front, the picture has become considerably more complicated. Despite the principle agreement reached in the past by 176 IMO member countries to reach net zero by 2050, this year negotiations to introduce a first global carbon pricing mechanism have practically collapsed in the face of aggressive blocking led by the United States, with the support of Saudi Arabia and Greece.
The UN body is now examining various proposals amid strong internal divisions. Its Secretary-General Arsenio Dominguez admitted that shipping cannot decarbonize alone and needs contributions from all sectors, especially the energy sector. Dominguez also hoped that future discussions could take place in a better geopolitical context.
China, a major competitor of Greece, has instead shown more openness, seeing the adoption of green fuels as an opportunity to strengthen its emerging alternative energy industry.
Mitigation strategies
Faced with this uncertainty, the most widespread response among shipowners has been to order an increasing number of “dual-fuel” ships, capable of operating both with traditional fuels and with cleaner alternatives such as methanol or ammonia.
This is a compromise solution that allows maintaining operational flexibility without getting trapped in an alternative that might not take off.
Semiramis Paliou, chief executive of Diana Shipping, noted that green fuels have temporarily “taken a back seat,” while believing this is a transitional phase.
The choice of propulsion type remains, however, a complex decision that must take into account the type of ship, the routes served, and the unpredictable evolution of energy markets in the coming decades.
Growing enthusiasm for nuclear propulsion
Among the most innovative trends is the renewed interest in nuclear energy, a technology already tested on military submarines and Russian icebreakers but so far little used in commercial shipping.
The United States is actively promoting it to revive its shipbuilding sector and leverage existing nuclear expertise.
The American Bureau of Shipping recently approved the design of a nuclear-powered ship developed by the MIT consortium. Companies like Core Power are working on entire fleets of this type.
The advantages are significant: from autonomy that can last decades without refueling, to the possibility of sailing at higher speeds reducing concerns about consumption, to potentially competitive costs, around 500-600 dollars per ton.
However, important challenges remain related to high initial costs, regulatory complexity, and reactor safety, especially when it comes to entering crowded ports near large urban centers.
Other innovative solutions
The landscape is enriched by other experiments. Some container companies like Hapag-Lloyd are exploring carbon capture systems developed by startups like Seabound, which use pebbles to absorb CO2 and transform it into limestone.
Wind is experiencing a small but significant revival, with the global fleet of sailing cargo ships surpassing 100 units just these days.
Not everyone, however, has abandoned alternative fuels: Alexander Saverys of CMB Tech remains convinced that ammonia could prove the most economical among the options and has made concrete investments, including a terminal in Namibia and twelve ammonia-powered ships under construction, with the first to be launched by the end of the year.
Saverys recalls that “pioneers have always borne the greatest risks,” but in a rapidly changing world they can also gain a competitive advantage.
