The shipping industry is responsible for transporting about 80 percent of the world’s traded goods. It now faces a major environmental and economic challenge, how to cut its greenhouse gas emissions without jeopardising its financial stability. Research in the International Journal of Shipping and Transport Logistics proposes a decision-making tool that could help operators navigate these troubled waters and get back on an even keel between balancing environmental commitments with commercial risk.
The sector has long struggled with the complexity of decarbonisation. Choosing among alternative fuels such as liquefied natural gas (LNG), methanol, or hydrogen is not a straightforward calculation. Fuel prices fluctuate, supply chains remain underdeveloped, and regulatory frameworks evolve unevenly in different parts of the world. For many companies, particularly smaller operators, a bad investment today could lock them into technology that becomes obsolete tomorrow. This has led to a culture of caution, with only the biggest shipping companies able to make substantial moves toward alternative fuels, while smaller enterprises are forced to defer their decisions.
The research introduces a granular fuzzy pay-off method. Unlike traditional financial models, which rely on relatively stable and predictable inputs, this tool is designed to accommodate ambiguity and partial knowledge. In practice, this means the model can weigh investment choices even when critical variables, such as fuel availability or carbon pricing, are unclear. The “fuzzy” element refers to its ability to assign values to uncertain outcomes rather than forcing binary choices between success and failure.
The researchers carried out a case study with four fuel options for a bulk shipping operator: conventional diesel, LNG, methanol, and hydrogen. The analysis covers the period from 2025 to 2035 and the model’s predictions indicate that LNG is likely to serve as the most attractive transitional fuel during this decade. Compared with diesel, LNG offers both emission reductions and potential cost savings, positioning it as a pragmatic step toward decarbonisation.
Of course, LNG is a fossil fuel and cannot represent a long-term solution in contrast to methanol and hydrogen, which can be produced from sustainable and renewable resources. Neither was found to be economically viable in the near term. High production costs and limited supply infrastructure undermine their competitiveness. The study shows that the decisive factor shaping investment strategies over the next ten years is fuel cost itself, not the price of carbon. This suggests that regulations focused on carbon pricing will probably have little impact unless paired with measures that reduce the upfront costs of cleaner fuels.
Yang, J., Cullinane, K. and Ge, Y-e. (2025) ‘Applying public information to make green shipping investment decisions’, Int. J. Shipping and Transport Logistics, Vol. 21, No. 2, pp.186–213.
No comments:
Post a Comment