How can LNG-fuelled ships meet decarbonisation targets? An environmental and economic analysis

Abstract

International shipping faces strong challenges with new legally binding air quality regulations and a 50% decarbonisation target by 2050. Liquefied natural gas (LNG) is a widely used alternative to liquid fossil fuels, but methane emissions reduce its overall climate benefit. This study utilises new emissions measurements and supply-chain data to conduct a comprehensive environmental life cycle and cost assessment of LNG as a shipping fuel, compared to heavy fuel oil (HFO), marine diesel oil (MDO), methanol and prospective renewable fuels (hydrogen, ammonia, biogas and biomethanol). LNG gives improved air quality impacts, reduced fuel costs and moderate climate benefits compared to liquid fossil fuels, but with large variation across different LNG engine types. Methane slip from some engines is unacceptably high, whereas the best performing LNG engine offers up to 28% reduction in global warming potential when combined with the best-case LNG supply chain. Total methane emissions must be reduced to 0.8–1.6% to ensure climate benefit is realised across all timescales compared to current liquid fuels. However, it is no longer acceptable to merely match incumbent fuels; progress must be made towards decarbonisation targets. With methane emissions reduced to 0.5% of throughput, energy efficiency must increase 35% to meet a 50% decarbonisation target.