Biomethane supply could support shipping’s early decarbonisation by 2030

Global biomethane production could reach between 21 billion cubic metres (bcm) and 52 bcm by 2030, depending on policy support and market development, according to an analysis examining the fuel’s potential role in maritime decarbonisation.

The analysis compares projected biomethane availability with potential demand arising from the International Maritime Organization’s (IMO) draft Net-Zero Framework (NZF). While the framework remains under negotiation, it provides a reference point for assessing the scale of low-emissions fuel that shipping could require as climate regulations tighten.

The study estimates that the IMO NZF could generate unconstrained demand equivalent to approximately 29.7 bcm of biomethane in 2030 if biomethane were used to meet the entire requirement.

However, this figure is not a forecast of actual maritime biomethane consumption. Real-world uptake would depend on the number of methane-capable ships, bunkering infrastructure, certification rules and competition for biomethane from other sectors.

Biomethane production could expand significantly

The analysis starts with regional biomethane production of approximately 10.56 bcm in 2025. It models two potential growth scenarios through 2030.

Under the base scenario, production grows at a 15% compound annual growth rate (CAGR), consistent with assumptions in the International Energy Agency’s gas outlook. Under the maximum scenario, a 38% CAGR is applied, reflecting growth rates associated with European policy targets.

These scenarios result in global biomethane production of around 21 bcm in the base case and 52 bcm in the maximum case by 2030.

Both estimates remain below the technical potential identified by the IEA. This indicates that near-term limitations may be less about the availability of biomass and more about infrastructure, certification, regulation and access to gas and LNG networks.

Why biomethane could be relevant to shipping

Biomethane has an important characteristic for maritime applications: it is chemically equivalent to fossil methane. This means it can be used in existing LNG-fuelled vessels and associated gas infrastructure.

Depending on its feedstock, production process and emissions accounting methodology, biomethane can deliver low or potentially negative well-to-wake emissions.

This could make it relevant during the early years of shipping’s transition, when some alternative fuels such as e-ammonia and e-methanol may still face challenges related to production costs, renewable power availability, project execution, infrastructure and offtake.

The analysis therefore positions biomethane as a potential transitional fuel that could provide emissions reductions without requiring the maritime sector to wait for entirely new fuel infrastructure.

Mass balancing is central to biomethane’s maritime potential

One of the biggest challenges is how biomethane is physically supplied and its environmental attributes are accounted for.

Many major bunkering locations do not have sufficient local gas-grid or pipeline capacity to receive biomethane directly. Physically transporting and liquefying biomethane close to individual bunkering locations could be expensive and difficult to scale.

The analysis therefore identifies mass balancing as a key regulatory enabler.

Under a mass-balanced system, biomethane could be injected into an existing natural gas network, while its sustainability attributes are tracked through a certified chain of custody. The gas could subsequently be liquefied using existing LNG infrastructure and allocated to maritime consumption.

This approach would allow biomethane produced in one location on a connected gas network to support fuel consumption at a vessel bunkering elsewhere, reducing the need for dedicated physical transport of biomethane.

For this system to operate globally, however, certification and accounting rules would need to be harmonised. Methane leakage from gas networks and associated infrastructure would also need to be addressed when calculating the fuel’s lifecycle emissions.

Biomethane could theoretically meet a large share of 2030 demand

The analysis estimates that the draft IMO NZF could generate around 26 million tonnes of LSFO-equivalent demand for low-emissions fuel in 2030 under its base compliance scenario.

That demand is equivalent to approximately 29.7 bcm of biomethane.

Compared with the projected base-case biomethane supply, the analysis suggests that biomethane could theoretically address around 70% of shipping’s NZF-induced low-emissions energy demand in 2030.

The study stresses that this should not be interpreted as a demand forecast. Actual availability to shipping would be constrained by fleet composition, infrastructure, regulatory recognition and competition with other sectors.

Methane-capable vessels could limit uptake

The availability of biomethane is only one part of the equation. Ships must also be capable of using methane-based fuels.

According to the analysis, the global container fleet capable of burning liquefied biomethane could reach around 2.3 million DWT by 2030, representing approximately 70% of the methane-capable dual-fuel container fleet.

If all methane-fuelled container vessels were to operate exclusively on liquefied biomethane, shipping’s potential demand could reach roughly 11 million tonnes LSFO-equivalent.

That would represent up to approximately 56% of projected biomethane supply in the 2030 base case.

The analysis notes that vessel orders and shipyard lead times mean the size of the methane-capable fleet in 2030 is unlikely to change substantially. Bunkering vessels, terminals and other supporting infrastructure would also need to expand alongside the fleet.

Shipping will compete with other sectors for biomethane

Maritime demand will not develop in isolation.

Biomethane is also relevant to other sectors seeking to reduce emissions, and stronger or overlapping regulations could increase demand for the same supply. Aviation, road transport and other users could therefore compete with shipping for available biomethane.

The analysis also identifies other biofuels, including biodiesel and ethanol, as potential near-term compliance options. Biodiesel, for example, can be blended with conventional maritime fuels and used by a much larger portion of the existing fleet.

As a result, the price that other sectors are willing to pay for biomethane could influence how much supply becomes available to shipping.

Could IMO regulation make shipping a competitive biomethane buyer?

The analysis compares the potential value created by the IMO NZF with an indicative biomethane market benchmark.

Using the NZF fossil baseline of 93.3 gCO2e/MJ and a Tier 2 Remedial Unit price of US$380 per tonne of CO2e, the estimated maximum compliance value of biomethane is approximately US$84-104/MWh, based on the analysed carbon-intensity range.

An indicative current biomethane commodity value is estimated at approximately US$81/MWh, based on a fossil gas benchmark combined with a biomethane certificate premium.

The comparison suggests that the regulatory value created under the draft NZF could potentially make shipping a competitive buyer of biomethane at the commodity level.

However, the comparison excludes liquefaction, logistics, terminal handling and bunkering costs. It therefore does not represent a delivered marine fuel price.

Biomethane may have a bridging role beyond 2030

The potential role of biomethane is likely to change as shipping’s low-emissions fuel requirements increase.

The analysis projects NZF-induced demand for low-emissions fuel at around 100 Mt LSFO-equivalent by 2035 and more than 200 Mt by 2040.

Those volumes are likely to exceed what biomethane can sustainably supply to shipping once feedstock availability and cross-sector competition are taken into account.

Biomethane could therefore function primarily as a bridging fuel, helping shipping meet part of its early compliance requirements while other technologies and fuels scale.

E-ammonia, e-methanol and advanced biofuels are expected to remain important to the sector’s longer-term pathway towards net-zero emissions by or around 2050.

Regulation will determine how much biomethane reaches shipping

The analysis points to a relatively clear regulatory question: whether the IMO framework will recognize a credible and globally workable mass-balancing system for biomethane.

If such a system is established, shipping could potentially access biomethane through existing gas infrastructure rather than relying primarily on physically segregated supply chains.

If mass balancing is not permitted, physical delivery constraints could significantly reduce the amount of biomethane that can reach maritime bunkering locations before 2030.

The analysis concludes that biomethane could provide a meaningful source of early emissions abatement for shipping, but its actual contribution will depend on regulation, certification, fleet investment, infrastructure and competition from other sectors.