- The maritime industry advanced in retrofitting ships for alternative fuels in 2024, but a lack of incentives threatens widespread adoption.
- Due to limited availability of zero-emission fuels, shipowners increasingly opted for LNG retrofits, with over 305 LNG-fueled ships ordered.
- Limited shipyard capacity and uncertain regulations hinder large-scale retrofits, though MARPOL Annex VI amendments in 2024 eased dual-fuel engine recertification.
Lloyd’s Register’s 2025 Engine Retrofit Report finds that the maritime industry made significant strides in retrofitting ship engines for alternative fuels in 2024. The first methanol conversions since Stena Germanica (2015) were completed, and shipyard capabilities expanded. However, a critical lack of incentives remains a major hurdle to scaling adoption.
The 2023 Engine Retrofit Report identified around 13,500 ships that may require fuel conversions to align with IMO’s 2050 net-zero targets. While the IMO’s regulatory framework is still evolving, the EU’s FuelEU Maritime and Emissions Trading System (ETS) remain the only major cost drivers for alternative fuel adoption. The IMO’s mid-term measures are expected from 2027, but uncertainty makes it difficult for shipowners to assess fleet adaptation strategies, according to safety4sea.
LNG Retrofits and Market Trends
Due to the limited availability of zero- and near-zero-emission fuels, shipowners increasingly turned to LNG retrofits in 2024. Over 305 LNG-fueled ships were ordered, significantly outpacing methanol and ammonia. Existing LNG infrastructure and the challenges of scaling bio- and e-LNG make it a pragmatic compliance choice for the next decade.
Retrofit orders did not grow rapidly in 2024, but the report anticipates over 200 alternative fuel conversions annually from 2030. Methanol retrofits, particularly in the container segment, will increase over the next four years, while ammonia conversions remain in pilot stages.
Shipyard Capabilities and Supply Chain Challenges
The limited number of shipyards capable of retrofitting for alternative fuels remains a bottleneck. LR identified around 16 capable shipyards, primarily in China and the Middle East, which must expand significantly to meet demand.
Despite concerns, the dual-fuel engine supply chain is expected to remain stable, supported by engine builders’ capacity expansions. In 2024, regulatory progress included draft amendments to MARPOL Annex VI NOx Technical Code, easing recertification for modified engines.
Looking Ahead
With carbon pricing taking effect, shipowners are under pressure to comply with FuelEU Maritime, the EU ETS, and future IMO measures. The success of alternative fuel retrofits will depend on stronger incentives from regulators and increased fuel availability. In 2025, new conversions will provide critical experience, but sustained growth in orders will require clearer market signals.
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Source: Safety4sea
