Blog post
Bio-LNG and shipping: Navigating the choppy seas of decarbonisation
Biogas, 9 October 2025
One of the lesser-known facts about the Titanic is that it sailed without the key to the lookout’s binocular cupboard because a crew member, David Blair, had unexpectedly left the ship in Southampton with the key still in his jacket pocket. The ship set off into the Atlantic, the lookouts couldn’t see very far ahead, and that’s how Kate Winslet ended up hogging that big door all to herself in a freezing sea.
Today’s shipping industry has, of course, radar instead of sailors in crow’s nests, but it risks the same mistake: failing to see big things looming on the horizon. The iceberg this time is carbon emissions.
In 2022, international shipping burned about 300 million tonnes of fuel and produced over a billion tonnes of CO₂, or around 3% of global emissions. Regulators and customers alike are pressing hard for reductions, and the threat of legislation to cap emissions is very real. Everyone in shipping knows they must change course, but the debate keeps circling back to one word: fuel.
Big ships and big numbers
The problem with shipping is that everything is supersized, and so is the pollution.
A large container ship on a Europe-Asia run burns 60,000 tonnes of fuel a year which is roughly the energy use of a small city, or what you’d need if Milton Keynes suddenly decided to sail to Shanghai.
A single container ship emits about 300,000 tonnes of CO₂ a year, so if we imposed a carbon tax at EUR 80 per tonne of carbon that’s EUR 24 million per year, per ship.
This is why shipowners view “carbon taxes” the way most of us view tax increases for public spending: good in theory, but ideally someone else pays.
The threat of emissions trading
However, despite industry protests, the EU has already extended its Emissions Trading Scheme (ETS) to cover intra-EU shipping. For now, transatlantic and transpacific voyages remain outside the scope. But “for now” is doing a lot of the heavy lifting in that sentence. Almost everyone believes broader restrictions on the emissions created by pan-Atlantic and pan-Pacific routes are only a matter of time, which is why shipowners are urgently exploring alternatives to heavy fuel oil.
What about electrification?
It is not really an option. A few short ferry routes run on batteries, but the physics of energy density per kg kills the idea for long-haul shipping. One tonne of fuel oil has 4.5 MWh of energy, which is the same as a battery weighing 25 tonnes. A transatlantic voyage that consumes 3,000 tonnes of fuel oil in 15 days would need 67,500 tonnes of batteries because they can’t be recharged at sea. Unless we plan to build ships that sink under the weight of their own power supply, batteries are out of the picture.
Liquified Natural Gas (LNG) as a stepping stone
This brings us nicely to LNG. There are now 400+ LNG-fuelled ships afloat and another 500 on order. LNG cuts CO₂ emissions by about 20% compared to heavy fuel oil and eliminates most SOx and particulates. It is a step in the right direction, albeit a little one.
But LNG is still methane, and this brings us nicely to the concept of ‘methane slip’. This sounds like the sort of grunge band your moody teenage kid likes but actually refers to the 1–3% of methane that escapes unburned from the engines in the exhaust. This means that by burning LNG, we are actually putting a little bit of methane into the atmosphere, somewhat undermining the benefit. As an aside I once had a ‘chunky’ friend who went on a diet plan, faithfully ate all the prescribed salads and fruits, but slightly misunderstood the instructions and continued his usual intake of beer, pies and cakes as well. Technically he was “on the diet plan,” but the overall effect? Negligible. That’s methane slip, it’s better than the emissions from heavy oil, but like my friend’s unorthodox approach to dieting, the overall climate benefit is severely diminished.
That said, LNG’s real value is in building bunkering infrastructure. Over 200 ports now offer LNG bunkering, and every one of them can handle bio-LNG with no changes. That’s like having a universal phone charger, rare, useful, and worth investing in.
Enter bio-LNG
Bio-LNG is simply biomethane (from manure, food waste, sewage, agricultural residues) that has been liquefied. Chemically, it’s identical to LNG, the molecules don’t know or don’t care whether they came from a cow or a gas field.
The problem is twofold: lack of supply and cost. Global biomethane production is around 95 TWH per year, versus shipping’s demand of 10,000 TWh/year. That’s just 0.95% and only if all biomethane went into ships.
Cost is the other hurdle. Fossil LNG trades at $400–600/tonne; bio-LNG at $1,500–3,000/tonne. A 20,000 TEU container ship burning 200 tonnes/day would add $200,000/day in fuel costs if it ran on bio-LNG alone, so that’s why nobody is buying bio-LNG yet.
How this might change
Three things could tip the balance:
ETS expansion – As we discussed in a previous blog, biogas made from manure or waste has a negative CI score of around (50 Co2ge/MJ) compared to 80 90 Co2g e/MJ for natural LNG. This means that if a shipping owner burns Bio-LNG, they no longer have to buy carbon credits, they may actually be able to sell them. This is a big win and would go a very long way to offsetting the cost difference the two fuels, but only if the EU imposes a carbon tax on shipping.
Cargo-owner pressure – If big shippers like Amazon, IKEA, or Nike agree to pay a “green freight premium,” costs could be passed down the chain, though this idea may run into the same headwind of adverse public opinion facing the rest of the renewables industry. People are turning against green policies that impact their day-to-day budgets and are unlikely to swallow a hike in the cost of Nike trainers because of an emission tax on shipping.
Scale – The ongoing expansion of Europe’s biomethane expansion will increase supply and reduce costs but shipping will face strong competition from heating, transport, and industry for the same molecules. This is good news for investors in biogas of course.
The strategic value of optionality
For many shipowners, LNG is an insurance policy against looming regulations. They’re building 500 new ships that can run on fossil LNG today, bio-LNG tomorrow, and synthetic e-LNG (from green hydrogen and captured CO₂) in the 2030s. With ships lasting 25–30 years, that kind of flexibility is worth a lot.
Final thought
Neither LNG nor bio-LNG will be the whole of the answer. Neither gas can meet full demand, nor can they eliminate methane slip. But they can enable progress in building bunkering infrastructure, diversifying supply chains, and buying time.
The unsinkable Titanic’s maiden voyage lasted only five days before she sank. By anticipating the regulatory “icebergs” ahead and by investing in vessels capable of running on both fossil and renewable gas, the shipping industry can give itself a lot more time and flexibility to change course.