DNV white paper shows methanol practical for shipping but still expensive

In Norway, as the shipping industry explores multiple decarbonization pathways, methanol is gaining attention as a practical and scalable alternative fuel for deep-sea shipping. This is supported by over 450 methanol-capable vessels in operation and on order and technical solutions now available for all major ship types.

DNV’s latest white paper, “Methanol fuel in shipping,” highlights that methanol-fuelled engines and technical systems have reached high readiness levels, and that existing global production sites, storage facilities, and a growing bunker fleet are providing a strong platform for wider adoption. In addition, industry stakeholders are already investing in the fuel, with China accounting for 43 percent of planned global low-GHG methanol production capacity. But, as with all alternative fuels, methanol’s future role will depend on a combination of regulatory, economic, and operational factors.

The report notes that cost and availability remain significant barriers, as is the case for many alternative fuels. Bio-methanol prices in 2025 average around $2,500 per ton MGOe, roughly three times the cost of marine gas oil, while global production stands at just 2.2 million tons, far below the potential demand of up to 60 million tons by 2040. The report models four demand scenarios, showing that regulatory frameworks such as the IMO’s Net Zero Framework and FuelEU Maritime could be decisive in scaling up adoption.