Methanol reaches readiness as cost and supply gaps still pose major hurdles

DNV estimated bio-methanol at about US$2,500 per tonne of MGO equivalent in 2025.

Methanol is reaching a high level of technical readiness as a marine fuel, with more than 450 methanol-capable vessels in operation or on order and a steadily expanding bunkering fleet and infrastructure, according to DNV.

DNV said modern dual-fuel methanol engines have accumulated more than 600,000 operating hours, with reliability performance comparable to conventional designs.

Retrofit feasibility is now well established, helped by the fact that methanol uses conventional, non-cryogenic bunkering systems that ease adoption at ports.

Methanol’s environmental profile is another driver. The fuel is sulfur-free, produces negligible soot, and generates lower NOx emissions than fuel oil. Bio-methanol and e-methanol pathways can deliver very low, or in some cases negative, lifecycle emissions.

Cost and supply gaps remain significant. DNV estimated bio-methanol at about US$2,500 per tonne of MGO equivalent in 2025, roughly three times the cost of marine gas oil.

Global production is about 2.2 million tonnes, compared with the potential demand of up to 60 million tonnes by 2040. China accounts for about 43% of planned low-GHG methanol capacity.

Regulation will play a central role in determining uptake. DNV said the International Maritime Organization’s Net-Zero Framework and Europe’s FuelEU Maritime regulation could be decisive for scaling methanol adoption across the fleet.

Fuel flexibility provides an added advantage. Current dual-fuel engines can operate on methanol, biodiesel, and conventional fuels, and with minor modifications, ethanol.