Decarbonising the transport sector is key to reducing global greenhouse gas emissions, but there are vast discrepancies in how fast this process is occurring across different modes of transport. In 2022 14% of cars sold were electric, rising to 18% in 2023. By contrast, approximately 150 ships powered by biofuels sailed in the same year, which represents around 0.15% of the global merchant fleet, estimated at around a total of 100,000.

“As opposed to the speed of the EV [electric vehicle] transition in road travel, heavy freight transport, which includes shipping, encapsulates some of the biggest challenges of climate change,” says Ingrid Irigoyen, the president and CEO of the Zero Emission Maritime Buyers Alliance (ZEMBA). Ships are extremely large and heavy steel machines, loaded with freight adding up to billions of tonnes. Ocean transport has been essential to the global economy for thousands of years, and disrupting those critical services to experiment with new technologies is an unappealing prospect for many business owners, whose customers are reluctant to invest in more expensive sustainable fuels. But the sooner the transition begins, the smoother it will be.

While electric power is unrealistic for heavy shipping due to the size and weight of batteries, there are technologically viable alternative fuel pathways that can achieve decarbonisation. Advanced biofuels can serve for the short term and green hydrogen-based fuels such as e-ammonia for the long term—the only stumbling block is the current high costs of these fuels when compared with fossil fuels. “The fundamental problem is the lack of willingness to pay the high cost of these fuels in the early days,” says Ms Irigoyen. “We need to break out of the cycle of using cheap heavy fuel oil and move forward with fuels that are currently a lot more expensive, which requires courageous leadership; courage is always bolstered by a strong business case, and that’s where ZEMBA comes in.”

ZEMBA, featuring Schneider Electric, Amazon, New Balance and Patagonia among its members, is a buyers group aiming to accelerate the deployment of zero-emissions shipping solutions within the industry. In doing so, they can help cargo owners shape the market and improve emission reduction outcomes beyond what any one buyer could accomplish alone. The goal is to use collective buying power to ultimately bring down the cost of new fuels.

ZEMBA aggregates demand from cargo owners and combines it in competitive tenders, a process that allows buyers to support shipping lines’ investments in green fuel. “Demand for clean fuels from a few cargo owner companies doesn’t amount to much unless they come together, aggregate that demand, and channel their investment into the shipping lines with the best, most pioneering solutions,” says Ms Irigoyen. “It’s about creating a new, long-term market for those new fuels and technologies.”

As these technologies evolve, their successful demonstration is crucial for increasing buyer interest and growing the market. To facilitate this, coZEV is spearheading the development of green shipping corridors—designated routes specifically for testing and showcasing zero-emission solutions while aligning various components of the sustainable shipping value chain. These corridors serve as real-world laboratories where stakeholders can co-ordinate private investments through strategic offtake agreements, operating on a manageable scale to prove both the technical feasibility and commercial viability of zero-emission shipping. Rotterdam-Singapore is one corridor under development, with both sites building new storage facilities for hydrogen-based fuels. In 2023 the first container ship sailed this route, powered by e-methanol. The practical application of new technologies is crucial for identifying what can serve as the pathway to the future.

The most advanced sustainable shipping fuels are largely green biofuels, such as those derived from waste cooking oil. These have seen significant progress due to their cost advantage over alternatives, like e-ammonia, which is derived from hydrogen produced with renewable energy. However, the long-term viability of biofuels is questionable. Their dependence on limited biogenic feedstocks, which face increasing demand across multiple industries, suggests they cannot meet the shipping sector’s future needs as demand inevitably outpaces supply. “Biofuels are just a temporary bridge, and we need to be building a long-term pathway,” says Ms Irigoyen. “Because they can be scaled so significantly, fuels derived from clean hydrogen are the key to that pathway.”

While the maritime sector faces many unique challenges, many of the solutions derived for its decarbonisation pathway can have positive cross-sectoral impacts. Heavy freight industries like aviation and trucking can benefit from the solutions derived to move heavy ships forward. But benefits can go beyond transport. E-ammonia is a useful fuel, but ammonia is also a key ingredient in fertiliser, so lessons on its sustainable production from shipping can benefit agriculture. Through collaboration, reducing costs for green fuels can create a new marketplace for zero-carbon solutions that will benefit all industries.

While ZEMBA creates a space for climate-leading players in the maritime sector to kickstart a new marketplace, the vast majority of companies are unwilling or unable to take the steps required to be a first mover, largely due to the high costs of alternative fuels. Currently, these costs put climate leaders at a disadvantage in the market. ZEMBA’s goal is to change the landscape so that zero-emission technologies are a beneficial business case for all, but their private sector leadership must be backed up by public sector support. “The clean energy sector is asking governments to view this transition as essential for the future wellbeing of humanity, and ensure that new industries are able to launch supported by both the public and private sectors,” says Ms Irigoyen. “At ZEMBA, we’re sending signals about how we view the long-term pathway to net zero and what fuels and technologies we want to see become economically viable, and we’re looking for policymakers to provide the right incentives.”

Regional policy changes have made significant strides, such as the EU’s recent inclusion of shipping in its emissions trading system and the US’ Inflation Reduction Act, which, among other actions, establishes incentives for scaling up hydrogen-based feedstocks. However, without a comprehensive global approach led by an international body like the International Maritime Organization, these regional efforts risk creating a fragmented regulatory landscape, increasing uncertainty for cargo owners. ZEMBA members are taking the initiative where they can but emphasise that more policy support is needed to expand economic incentives for clean shipping globally. “We aren’t just waiting around for policymakers to do the right thing, we’re actively harnessing momentum through leadership in the sector,” says Ms Irigoyen. “We’re happy to be first movers, but we want to emphasise that our actions will have a limited impact in the long run, and policy measures will be needed to close the cost gap.”

Private sector support for ambitious policy measures is essential to effect meaningful change. Efforts to influence policymakers must highlight the multifaceted benefits of a cleaner shipping industry, including economic growth, enhanced national security, technological innovation and improved public health. By engaging a broader range of stakeholders and conveying a sense of urgency, the industry’s climate leaders aim to catalyse the necessary policy changes for a sustainable maritime future. “The cost and the disruption caused by delaying the transition is too high, so we must act soon, we must act collaboratively, and we’ve got to get fuels and technologies into the marketplace with the right policy support to bring down the cost,” says Ms Irigoyen.