While global ordering activity softened compared to 2024 levels, orders for alternative-fuel capable vessels maintained strong momentum in 2025.
According to LR analysis of Clarkson’s data, in 2025, owners ordered 590 merchant and leisure vessels1 totalling 45.5m gt capable of operating on alternative fuels at delivery. The total alternative fuel capable orderbook now stands at 1,942 ships with 1,259 set to use LNG, 385 to use methanol, 139 using LPG, 53 vessels equipped to use hydrogen, 55 ethane, 45 ammonia, 22 biofuel and 4 nuclear-capable.
These vessels helped to grow the future alternative-fuel capable fleet, both in-service and on order, to 4,542 vessels (294.7mGT), equivalent to 2.1% of the global fleet and orderbook tonnage.
However, with the International Maritime Organization’s (IMO) 2030 target on zero and near-zero emission energy potentially less than five years away, orders will need to accelerate further to meet the proposed 5%-10% of shipping energy consumption using new fuels. In European waters, FuelEU Maritime already compels operators to reduce their emissions and transition to new fuels.
Diversity of fuels expanded throughout the year
LNG retained its position as shipping’s most widely adopted alternative fuel in 2025 with 407 merchant and leisure vessel orders to be LNG-capable on delivery, a growing in-service fleet and sustained ordering interest, particularly within container, tanker and gas carrier segments. LR’s Fuel for Thought: LNG report confirmed LNG’s continued appeal for owners and operators, with immediate carbon dioxide emissions reductions relative to conventional marine fuels.
Two issues must be tackled for LNG to continue its strong appeal; to address methane slip, and accelerate the transition towards bio-LNG and synthetic LNG variants to align with longer-term decarbonisation objectives.
Methanol-capable vessels continued to attract attention in 2025, with 134 orders, accounting for a substantial proportion of the alternative-fuelled orderbook. In July, LR strengthened the regulatory foundation for methanol as a marine fuel by updating its Rules and Regulations for Ships Using Gases or Other Low-flashpoint Fuels to reflect evolving safety expectations and align with the IMO IGF Code (International Code of Safety for Ships Using Gases or Other Low-Flashpoint Fuels).
Another established alternative fuel, liquefied petroleum gas (LPG), saw 24 additional LPG-capable vessels ordered in 2025. At present, LPG carrier vessels are the primary users of this fuel; however, there remains potential for adoption by other vessel types.
There were six orders for ammonia-fuel capable vessels. Progress during the year included further approvals in principle for ammonia-ready designs and ongoing work to address production capacity and regulatory advancement.
Hydrogen maintained momentum with 13 hydrogen capable orders and solid interest in specific segments, including passenger ferries and shallow-draft vessels. Fuel cells powered by hydrogen are viewed as options for achieving zero or near net-zero tank-to-wake emissions. LR’s updated guidance for the installation of fuel cells on ships incorporates recent regulatory updates and technical developments related to fuel cell technology in the maritime sector.
Biofuels also strengthened their position as a practical, near-term solution for emissions reduction, particularly within existing fleets, with 11 biofuel-capable newbuild orders (up from eight in 2024). According to the H1 fuel quality report from LR’s Fuel Oil Bunkering Analysis and Advisory Service (FOBAS), the diversity and quality of biofuels are growing. Uptake of FAME-based biofuel blends, notably B30 RF, is increasing across ports including Singapore, Algeciras and Antwerp.
In April, LR’s Global Fuel Finder tool added biofuel availability and quality insights to the platform, helping users search, compare and analyse biofuels across global ports. Earlier in the year, operator John H Whitaker Tankers launched Whitchampion, the first bunker tanker certified to load, carry and blend FAME B100 biofuel on board. The IMO also issued improved guidance on carrying biofuel blends by bunker ships, with interim guidelines outlining new requirements for alternative fuel systems, operational risk assessments, and the handling of biofuel blends.
While nuclear remains a longer-term and highly regulated prospect, LR continued to explore its potential applications within the maritime sector. A partnership with Microsoft (via Azure OpenAI) will see generative AI used to accelerate permitting/licencing processes for maritime nuclear applications. LR also joined a global cross-industry pledge to triple nuclear energy capacity by 2050 and published Navigating Nuclear Energy in Maritime, the industry’s first guidance document for nuclear-powered shipping.
Retrofit momentum grows
Beyond fuel choice, LR’s Retrofit Research Programme offered valuable perspectives into how existing tonnage can adapt to evolving energy systems. LR’s 2025 Engine Retrofit Report revealed the resurgence of LNG retrofits as shipowners sought immediate carbon reduction strategies to comply with regulatory requirements. However, despite the industry making strides, a significant shortage of supply-side incentives threatens to delay progress.
While the number of retrofit-capable yards has increased to around 16 shipyards, mainly in China and the Middle East, retrofit capacity is currently at approximately 465 vessel conversions annually, well below the projected peak requirement of more than 1,000 conversions per year, according to the report.
Hull optimisation and energy-saving devices (ESDs) rose in strategic importance, with 28.5% of vessels on order choosing to install at least one ESD. LR’s Energy saving devices retrofit report showed that high-efficiency propellers can deliver fuel savings of between 3% and 10%, and popular devices such as rudder bulbs can achieve 3.5% reductions.
At Nor-Shipping, LR granted the world’s first recognised enhanced approval to Jotun’s SeaQuantum Skate coating and HullSkater cleaning system, making it the first fully integrated hull cleaning and coating solution to be certified by a classification society.
The number of ships fitted with wind-assisted propulsion (WAPs) devices continues to grow, with bulk carriers and tankers leading the way. LR played a central role in the successful delivery of BRANDS HATCH, the world’s first newbuild Aframax tanker equipped with WAPs.
Performance verification was another area where LR made its mark. Working with Anemoi Marine Technologies and bound4blue, LR helped standardise methodologies for calculating wind-assisted power contributions and verifying fuel savings during normal operations. Fuel savings of between 5% and 15% are now routinely reported, and in some cases, gains of up to 30% have been achieved. With EU ETS costs rising and GHG intensity targets tightening, these savings translate directly into a competitive advantage.
Market and policy dynamics
The success of the energy transition depends on more than just technology. LR’s Maritime Decarbonisation Hub, in partnership with Environmental Defense Fund (EDF), published research highlighting the trillion-plus dollar financing gap that risks the sector’s transition away from fossil fuels. This work brought together shipowners, financiers, fuel producers and insurers to explore new financing mechanisms capable of unlocking large-scale investment in green fuel production, bunkering infrastructure and retrofits.
Workforce capability continues to be a critical issue to address. Alternative fuels such as methanol, ammonia and hydrogen demand new operational competencies, risk management frameworks and safety protocols. The Maritime Just Transition Task Force, with contributions from LR, released industry-first training frameworks covering both seafarer and shore-based roles, addressing the human factors inherent in risk-based fuel operations. The first-of-a-kind frameworks are designed as blueprints for a global training standard, shaping mandatory instruments that will upskill and reskill seafarers in the following decades navigating towards net zero.
Strategic collaboration and assurance
The regulatory landscape has sharpened, with the IMO’s revised GHG strategy now set out in full, and the entry into force of FuelEU Maritime and the expanded EU ETS. The Mediterranean’s new Sulphur Oxides Emission Control Area and the Canadian Arctic’s phased-in NOx and SOx controls have added to the urgency.
LR’s collaboration with EXMAR and the Belgian Federal Public Service to develop interim guidelines enabling the safe use of ammonia cargo as fuel marks a significant step forward. Additionally, LR updated its guidance for the installation of fuel cells powered by hydrogen or ammonia on ships, as well as revised technical notations for wind propulsion systems that apply to both retrofitted and hybrid installations.
Where 2025 leaves the industry
Despite these advances, LR’s Global Maritime Trends Barometer indicates that global energy infrastructure and workforce readiness still lag behind both technological innovation and regulatory ambition. The report benchmarking shows that while newbuild orders and retrofit readiness have improved, energy transition scores ranged from just 24% to 30% alignment with 2030 decarbonisation targets.
Energy production systems are still predominantly fossil fuel-centric, and significant underinvestment persists in workforce development and port infrastructure. Progress is tangible and accelerating, but not yet comprehensive enough to meet the scale and urgency of international climate goals.
Looking forward to 2026 and beyond, the alternative fuels landscape is more diverse than ever, and its complexity continues to deepen. No single solution has emerged as the definitive answer, and each option presents its own set of unique challenges and dependencies.
In this period of critical change, success will belong to those who move swiftly, embrace a broad portfolio of strategies, and remain sharply attuned to the evolving realities of regulation, supply chains and technological change. The future will be shaped by those who not only adapt, but also offer leadership, helping to build a resilient, sustainable and transformative maritime industry.
[i] Based on data from IHS, Clarksons and LR; alternative fuels are ammonia, ethane, hydrogen, LNG, LPG, nuclear and methanol.
