Biofuels

Biofuels have long been touted as a readily available, potential transitional fuel solution that could contribute towards the decarbonisation of the maritime sector. With significant strides being made across the maritime sector, the yachting industry is already starting to see the emergence onto the water of the first biofuel projects, with yachting well placed to drive things forward.

One of the reasons for this is the increased demand from a growing group of owners for “sustainable luxury”. Some of these owners, in partnership with leading yacht builders, are investing in research and development across a range of technologies. As technology advances and fuel supply chains develop, certain builders are announcing new biofuel powered yachts, whilst other stakeholders are developing initiatives to increase the uptake of biofuels and attract environmentally conscious owners.

San Lorenzo, for instance, have recently announced their LIFE MYSTIC project¹, with the aim of testing engines and generators for large yachts powered by a bi-fuel mixture of diesel and green methanol. LIFE MYSTIC forms part of San Lorenzo’s ‘Road to 2030’, which aims to deliver the first carbon neutral superyacht by 2030, and includes other projects such as 50Steel, the world’s first superyacht to use a green methanol fuel cell to generate onboard electricity.

Interest in hydrotreated vegetable oil (HVO) fuel for large yachts is growing. Fioul 83, one supplier of HVO, claims to offer 90% reduction in carbon dioxide emissions compared to conventional fuels on the basis that it is made from recycled oils. Feadship constructed the biofuel powered superyacht OBSIDIAN in 2023, which is equipped with generators that use HVO fuel.

The Superyacht Eco Association (SEA) Index, which assesses the carbon emissions from yachts, has recently started certifying yachts with methanol technology.

It is, however, important to bear in mind that greenhouse gas (GHG) emissions from the shipping sector are now being heavily regulated on a global, regional and national scale and the regulatory compliance cost is significant. Not all biofuels are equal. This is highly relevant when considering the use of biofuels and biofuel blends, all of which will need to meet set criteria if they are to qualify and thereby contribute to a reduction in compliance costs, or otherwise risk being treated in the same way as other conventional liquid fossil fuels.  For example, under the EU Emission Trading System (EU ETS)² (regulating CO2 emissions³ on a tank to wake basis from 1 January 2024) and FuelEU Maritime⁴ (regulating the entire lifecycle basis of a vessel’s GHG emissions from 1 January 2025), biofuels and biofuel blends will need to meet the sustainability and GHG emissions saving criteria set out in the EU Renewable Energy Directive (RED)⁵ and present with the appropriate documentation/certification if they are to contribute towards compliance pathways.

Likewise, for MARPOL’s global Carbon Intensity Regulations⁶, only biofuels which have been documented and certified as sustainable in accordance with that regulation will qualify⁷. Whilst, currently, these regulations only impact yachts of 5,000gt and above, it should be borne in mind that the EU MRV (Monitoring, Reporting, and Verification) regulation will apply to yachts over 400gt from 1 January 2025, with the expectation that EU ETS will also be applicable from 1 January 2026 and, with the current decarbonisation trajectory, the full spectrum of regulations may well follow suit.

For a sector that faces significant sustainability challenges, many of which are not of their own making, these are welcome developments. If the new technologies then filter into wider use and materially contribute to the drive to net zero, that would be a commendable achievement for the yachting industry. However, it will be important not to lose sight along the way of the multi-faceted regulatory landscape which is increasingly likely to regulate a yacht’s GHG emissions and fuel choices on an entire lifecycle basis. With the regulatory trajectory clear and hardening public perception, all yacht owners should be encouraged to start thinking about their fuel and propulsion choices.

Footnotes

1. https://www.sanlorenzoyacht.com/uk/responsible-development/life-mystic-project.asp
2. Directive (EU) 2023/959, amending Directive 2003/87/EC.
3. Albeit with CH4 and NO2 emissions to be included from 01.01.26.
4. Regulation (EU) 2023/1805, and amending Directive 2009/16/EC.
5. Directive (EU) 2018/2001.
6. MEPC 328(76) of Revised MARPOL Annex VI.
7. MEPC 1/Circ905, until MARPOL’s Life Cycle Assessment is applicable.