- Global production, storage and bunkering infrastructure is expanding.
- China leads low-GHG methanol capacity growth with 43% share.
- Environmental benefits are strong, but costs and availability constrain adoption.
DNV has just released a new white paper that reveals that engines powered by methanol and their supporting systems are now ready for use. With established global production hubs, storage networks, and an expanding fleet of methanol bunkering options, the groundwork is being laid for broader adoption across the industry. Investment from stakeholders is on the rise, too, with China leading the charge, accounting for 43% of the planned low-GHG methanol production capacity. However, DNV points out that the long-term success of methanol will hinge on how regulatory, economic, and operational landscapes change over time, reports DNV.
Industry Needs Multiple Decarbonization Pathways
Knut Ørbeck-Nilssen, CEO Maritime at DNV, emphasised that the industry must maintain a broad perspective when selecting future fuels: “As the maritime industry explores pathways to a lower-carbon future, it is important to consider a range of practical and scalable solutions. There is no one-size-fits-all answer, and different shipping segments and geographies will require different approaches. Methanol is one option that draws on established technologies and infrastructure, and it is encouraging to see the industry’s growing interest in a variety of alternative fuels.”
Environmental Advantages Strengthen Methanol’s Appeal
Methanol brings a host of environmental benefits to the table: it’s free of sulfur, produces minimal soot, and emits significantly lower levels of NOx compared to traditional fuel oil. The white paper emphasises that certain pathways for bio- and e-methanol can achieve impressively low or even negative lifecycle greenhouse gas emissions. Plus, its compatibility with current port infrastructure and the availability of temporary bunkering solutions could simplify the transition and help reduce costs for shipowners.
High Costs and Limited Supply Remain Key Challenges
Even with its benefits, methanol still grapples with economic and supply challenges. By 2025, the average price of bio-methanol is expected to be around USD 2,500 per tonne MGOe, which is roughly three times the price of marine gas oil. Currently, global production is at 2.2 million tonnes, which is a far cry from the estimated 60 million tonnes needed by 2040. DNV has modelled four potential demand scenarios and concludes that regulatory frameworks—like the IMO’s Net Zero Framework and FuelEU Maritime, could play a significant role in scaling up production.
Technical Reliability and Retrofit Feasibility Confirmed
Marius Leisner, Senior Principal Consultant at DNV, highlighted operational performance and flexibility: “From a technical perspective, methanol-fuelled engines have demonstrated high reliability, with industry data indicating that modern dual-fuel engine designs have accumulated more than 600,000 operating hours on methanol. Retrofit feasibility is well established, and the use of conventional bunkering systems, unlike cryogenic fuels, means ports can adapt quickly and cost-effectively.”
Leisner also noted methanol’s fuel versatility: “Methanol also provides fuel flexibility: dual-fuel engines can operate on methanol, biodiesel, or conventional fuels, and, with minor modifications, on ethanol. DNV’s Fuel Selector service and Alternative Fuels Insight (AFI) platform offer shipowners data-driven guidance on compliance costs and transition strategies.”
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Source: DNV
