Transition Strategy for LPG as Marine Fuel Through 2050
Author: Jeroen Berger • Publication date:
The maritime sector is under growing pressure to reduce emissions. New regulations such as the European Union Emissions Trading System (EU ETS), the FuelEU Maritime Regulation and stricter requirements under MARPOL Annex VI are pushing shipping companies and shipowners to phase out conventional fuels. At the same time, cargo owners and ports are imposing more stringent demands on the environmental performance of ships. In this context, liquefied petroleum gas (LPG) is increasingly considered a realistic and technically feasible transitional option.
LPG is a mixture of propane and butane. It is widely available and based on proven technologies with a strong safety record. The fuel has been transported as cargo for decades and is subject to operational standards that can also be applied when used as marine fuel. Since LPG remains liquid at ambient temperature under moderate pressure, it can be used onboard without significant modifications to tanks, piping or bunkering infrastructure. This makes LPG compatible with existing ship types and operational processes.
For fleet owners seeking to comply with stricter emission regulations, LPG offers several advantages. It has a high energy density, emits almost no sulfur oxides (SOx) and reduces nitrogen oxides (NOx). Retrofitting existing engines is technically feasible and does not require cryogenic storage or corrosion-resistant materials. Combined with onboard carbon capture, LPG can contribute to a structural reduction in lifecycle greenhouse gas emissions.
This article examines LPG’s position in the marine fuel mix. It compares performance with other alternative fuels and discusses strategic implications for compliance, certification and investment decisions through 2050.
What Is LPG as a Marine Fuel?
LPG is a liquid mixture of propane and butane that remains stable at ambient temperature under moderate pressure. In maritime applications, it is available in two forms: conventional LPG, derived as a byproduct from natural gas and refining processes, and bio-LPG, produced from biomass or industrial waste streams. Both forms are chemically identical and can be used without modifications to tanks, piping systems or engines. The use of bio-LPG enables emission reductions across the entire chain, contributing to climate goals set by shipping companies, shipowners and policymakers.
When combusted, LPG mainly produces carbon dioxide and water. Sulfur compounds are virtually absent, resulting in negligible SOx emissions. NOx emissions are reduced by approximately 20 percent compared to low-sulfur fuel oil. These performance levels meet the strictest MARPOL Annex VI requirements, including in Sulfur Emission Control Areas (SECAs) and NOx Emission Control Areas (NECAs) such as the North Sea and the Baltic Sea. With a well-to-wake CO2 equivalent of around 76 g/MJ, LPG is among the most climate-efficient fossil fuels currently in commercial use.
A key technical benefit of LPG is its high gravimetric energy density, which requires less tank space compared to methanol or hydrogen. This limits the impact on a vessel’s internal layout and increases operational range. Retrofitting is technically feasible without significant modifications to the hull, stability or design standards and remains within current construction and classification requirements.
LPG is already widely used in shipping. Gas carriers and supply vessels have been transporting it for decades. These ships are operated by crews trained in safe storage systems, gas detection and ventilation procedures. This expertise is directly transferable to fuel use and bunkering, in compliance with the International Code of Safety for Ships using Gases or other Low-flashpoint Fuels (IGF Code), which sets standards for ventilation, piping and condensation control.
Global infrastructure adds further strategic value. More than 1,000 LPG bunkering terminals are operational, and around 700 vessels support ship-to-ship delivery. This mature logistics network extends to all major ports worldwide, eliminating the need for dedicated bunkering vessels or terminal upgrades. This makes LPG an immediately deployable transitional fuel, while carbon-free alternatives such as e-methanol or e-ammonia are still under development.
Potential Contribution of LPG to Emission Reduction and Policy Goals
LPG burns significantly cleaner than conventional marine fuels. On a well-to-wake basis, LPG-powered ships can reduce greenhouse gas emissions by up to 30 percent compared to vessels using low-sulfur fuel oil (LSFO). SOx emissions are almost entirely eliminated, and NOx emissions are reduced by about 20 percent. These levels comply with the most stringent MARPOL Annex VI standards, including in SECAs and NECAs such as the North Sea and the Baltic Sea. LPG achieves these reductions without the use of Exhaust Gas Cleaning Systems (EGCS or scrubbers) or Selective Catalytic Reduction (SCR). This clean combustion profile makes LPG particularly suitable for vessels operating in emission-sensitive areas.
While LPG combustion still generates CO2, its emissions per energy unit are lower than those of heavy fuel oil (HFO) or marine diesel oil (MDO). Onboard Carbon Capture and Storage (OCCS) can reduce these emissions further. LPG engines are well suited for this, as the molar CO2 content in exhaust gases is relatively low. This reduces the required onboard storage volume and allows for compact OCCS system designs. The combination of clean combustion and efficient carbon capture reinforces LPG’s value in retrofit projects. A current limitation is that four-stroke LPG engines are not yet commercially available, meaning auxiliary systems still rely on conventional fuels. This mainly affects emissions during hotel load and port operations.
Lifecycle analyses show that the climate benefits of LPG improve further when bio-LPG or synthetic e-LPG is used. These variants enable compliance not only with MARPOL but also with the greenhouse gas targets under the FuelEU Maritime Regulation. LPG can therefore serve as a transitional fuel within a phased pathway toward climate neutrality by 2050. This allows shipowners to improve emissions performance in stages, without needing to switch immediately to fuels that require cryogenic storage or additional safety systems.
Availability, Market Development and Application Areas
LPG is globally available as a byproduct of natural gas extraction and refining. This fossil origin makes conventional LPG relatively affordable, price-stable and scalable, especially when compared to LNG or advanced biofuels. Current production capacity allows for immediate large-scale deployment without the need for additional infrastructure. Meanwhile, the market for renewable LPG (bio-LPG) is expanding rapidly, with projections of up to 120 megatons in annual production by 2050. This creates opportunities to transition a significant portion of the global fleet to a renewable fuel without major changes to the logistics chain.
Market developments support this trend. In the global order book for Medium Gas Carriers (MGCs), 83 percent of vessels on order feature dual-fuel engines that use LPG as the primary fuel. According to Drewry Maritime Research, 63 ships are on order, with over 280 engines. The active LPG fleet includes about 150 MGCs, with more than 100 currently under construction. These figures confirm that LPG technology is proven, robust and commercially accepted.
However, LPG is not yet widely used in auxiliary systems, as four-stroke engine development is still ongoing. Deck loads, hotel services and maneuvering therefore remain dependent on conventional fuels. Scaling up will require full dual-fuel solutions, including support systems.
Specific application areas are already well established. In petrochemical logistics, gas carriers have long used LPG as both cargo and fuel, improving operational efficiency. Newbuilds such as the Crystal Odyssey can carry and use both LPG and ammonia without requiring port infrastructure upgrades. The inland and coastal shipping segments are also well suited to LPG retrofits, thanks to its high energy density and liquid storage under moderate pressure, which allow for use without structural modifications to tanks or internal layout.
In deep-sea shipping, LPG is not yet widely applied as main engine fuel. For large container ships and tankers, engine power and power range remain barriers. Still, LPG offers clear advantages over alternatives such as methanol or a ammonia, including higher energy density, existing bunkering infrastructure and straightforward retrofit potential. LPG is therefore seen as a strategic transitional option in this segment, with potential for use in combination with onboard CO2 capture or complementary systems such as Wind Assisted Ship Propulsion (WASP). Further adoption depends on the availability of higher-output engines and commercial supply of bio-LPG.
Infrastructure, Bunkering and Supply Chain
A major advantage of LPG is the availability of global infrastructure. Unlike methanol or LNG, which face limited bunkering capacity, LPG benefits from a mature logistics network. More than 1,000 terminals are in operation, and about 900 vessels are available for ship-to-ship bunkering. This scale enables supply in nearly all major ports, without requiring investment in dedicated bunker vessels or new terminals.
Operational flexibility further strengthens LPG’s position. Unlike LNG, LPG does not require cryogenic storage, as it remains liquid at ambient temperature under moderate pressure. This makes bunkering faster and more straightforward. Existing import and export terminals can be used without technical modifications, and smaller LPG carriers can be used as bunker vessels. Crews already trained in LPG cargo handling can apply that expertise to bunkering operations, reducing the learning curve. These factors make LPG bunkering both logistically efficient and cost-effective.
The use of LPG as marine fuel is subject to several international regulatory frameworks. Both the International Gas Carrier (IGC) Code and the IGF Code apply. These define requirements for design, installation, operations and fire safety. Due to LPG’s low flash point and pressure-based storage, specific safety measures are required, including gas detection, overpressure protection, ventilation and structural protection of piping systems.
In July 2024, the IMO Maritime Safety Committee (MSC 108) adopted interim guidelines for using LPG cargo as fuel. These remain in force until the IGC Code is formally revised in 2026. The guidelines provide a uniform safety framework for vessels that use their cargo as fuel, such as dual-fuel LPG carriers.
Policy obligations are also increasing. From 2025, the FuelEU Maritime Regulation requires ships to reduce the average greenhouse gas intensity of fuels used in EU ports. Depending on composition and origin, LPG meets these reduction targets until around 2030. After that, bio-LPG or onboard carbon capture will be necessary to remain within the emissions cap.
Since 2024, the maritime sector is included in the expanded EU ETS. Shipping companies must purchase allowances for 50 percent of emissions on voyages to and from non-EU ports and 100 percent on intra-EU routes. This coverage increases to full emissions accounting from 2027.
Within these frameworks, LPG, when combined with bio-components or carbon capture technologies, represents a realistic fuel option that supports short- and medium-term objectives. Its established infrastructure, fast bunkering and relatively low costs reinforce its value as a transitional fuel for this decade.
Comparison of LPG With Other Alternative Fuels
Each alternative fuel, including methanol, ammonia, hydrogen, LNG, biofuels and electrification, has a specific role in the marine fuel mix. For strategic decision-making, it is important to assess these options based on energy density, safety, infrastructure, retrofit feasibility and emissions performance.
Methanol is a liquid alcohol that can be stored at atmospheric pressure. It virtually eliminates SOx and particulate emissions and significantly reduces NOx. Retrofitting is technically feasible but requires additional safety measures due to methanol’s low flash point, corrosive properties and toxicity. Its low energy density results in larger tank requirements. Compared to LPG, methanol poses higher safety risks and offers shorter range per unit volume.
Ammonia contains no carbon and can enable zero-emission shipping when produced renewably. Its energy density is comparable to methanol, but its toxicity and flammability require advanced safety systems. Combustion produces NOx and nitrous oxide, which must be treated using systems such as SCR catalysts, and a pilot fuel is required for ignition. Ammonia is currently limited to specific vessel types. LPG offers a more straightforward and safer short-term alternative that fits within existing infrastructure.
Hydrogen has the highest energy density per kilogram, but very low volumetric density. It requires either cryogenic or high-pressure storage, with major implications for ship design, safety and bunkering infrastructure. Commercial bunkering is still limited, making hydrogen mainly suitable for niche or demonstration use. In contrast, LPG is readily available and deployable in the near term.
LNG and biomethane can be used in dual-fuel engines similar to LPG systems. LNG has a higher energy density than methanol or hydrogen but requires cryogenic storage. Methane slip, meaning unburned methane released during bunkering or combustion, undermines its climate benefits. LPG offers lower net CO2 emissions without methane slip and does not require cryogenic systems.
Biofuels such as HVO and FAME are drop-in compatible with existing diesel engines and biodegradable. They require no major technical modifications, but sustainable feedstock availability is limited. They are also less suited for high-power applications. LPG offers a more scalable and globally available alternative.
Full electrification is suitable for short routes with low energy demand and enables local zero-emission operation. However, battery energy density is low, charging times are long and port infrastructure requirements are significant. In hybrid systems, batteries can support peak loads or zero-emission port operations. Combined with LPG, this offers a practical pathway to emission reduction without reliance on emerging fuels.
Strategic Implications for Shipowners, Investors and Certification
Increasing EU and IMO regulation requires deliberate choices on fuel strategies, propulsion technologies and retrofit planning. From 2025, the FuelEU Maritime Regulation mandates a 2 percent reduction in greenhouse gas intensity, increasing to 80 percent by 2050. From that year, ships of 5,000 GT and above fall under the EU ETS, requiring purchase of allowances for emissions on EU and non-EU voyages. LPG, particularly in combination with bio-LPG, can support compliance in the short and medium term.
At the IMO level, the Energy Efficiency Existing Ship Index (EEXI) and the Carbon Intensity Indicator (CII) introduce further obligations. LPG-fueled ships can achieve better CII ratings due to lower CO2 emissions per ton-mile. After three consecutive D-ratings or one E-rating, a corrective action plan is required. LPG helps avoid this and supports structural performance improvements.
Certification requires compliance with the IGF Code and interim IMO guidelines (MSC 108, 2024). Classification societies such as Lloyd’s Register and Bureau Veritas apply notations such as “LPG-Ready.” For newbuilds, space should be reserved for future conversion to methanol or ammonia. MAN Energy Solutions offers retrofit kits to convert existing engines to dual-fuel LPG systems.
While LPG dual-fuel engines are more expensive than conventional diesel engines, they are cheaper than LNG systems due to the absence of cryogenic tanks and complex fuel systems. Scrubbers and SCR systems are not needed, reducing operational costs. Existing infrastructure shortens payback times. Shipping companies benefit from faster bunkering, lower fuel costs and limited onboard modifications. For investors, LPG offers flexibility, scalability and retrofit potential.
Orders for alternative propulsion systems are growing. In 2024, new orders for ships with alternative fuels increased by more than 50 percent. LPG is now an established segment, alongside methanol and LNG. Given the complexity of fuel and technology decisions, hybrid strategies are gaining importance. A combination of LPG with technologies such as wind-assisted propulsion, battery systems or future nuclear propulsion offers a resilient long-term pathway.
The transition to LPG also requires adjusted bunkering and route planning. Global coverage is supported by more than 1,000 terminals and around 900 bunkering vessels. Major ports such as Rotterdam, Houston and Singapore offer multi-fuel loading terminals. For long-distance routes, strategic bunkering remains essential. Multi-fuel strategies with methanol or ammonia increase fuel security.
Shipowners pursuing an LPG strategy should consider the availability of bio-LPG in the coming decades. As renewable fuels become more limited or expensive, long-term contracts with suppliers and bunker operators offer a strategic advantage. LPG deployment also requires specific crew skills. Training on fuel transfer, safety procedures and emergency scenarios is essential to meet IGF Code and class requirements.
Conclusion and Recommendations Through 2050
LPG is a viable option in the maritime energy transition. It offers high energy density, near-zero SOx emissions, significantly lower NOx emissions and a global supply chain. Retrofitting is relatively straightforward and less costly than LNG. Safety and bunkering standards are established under the IGF Code and interim IMO guidelines, enabling certification. According to Drewry Maritime Research, 83 percent of medium gas carriers on order are fitted with LPG dual-fuel engines. Bunkering infrastructure is expanding rapidly.
However, LPG is not the final solution. Meeting the 80 percent greenhouse gas reduction target by 2050 will require a transition to bio-LPG or fully carbon-free fuels such as ammonia or hydrogen. The current lack of four-stroke LPG engines and continued reliance on conventional fuels for auxiliaries remain technical limitations. Investment in energy efficiency and onboard carbon capture remains essential.
A phased approach is the most robust strategy. From 2025 to 2030, focus on LPG as a transitional fuel to meet new EU and IMO requirements. Key investments include dual-fuel engines and onboard capture systems, supported by long-term contracts for conventional and bio-LPG supply.
From 2030 to 2040, shift to bio-LPG and hybrid configurations, with batteries supporting peak loads and maneuvering. Monitor four-stroke engine development and flexible designs such as methanol-ready and ammonia-ready. Align bunkering strategies with port development to ensure access to future fuel hubs.
From 2040 to 2050, prepare for gradual transition to fully carbon-free fuels such as e-ammonia or e-methanol. Ships built in the 2020s with LPG dual-fuel systems should be prepared for conversion. Investment in renewable energy and participation in green corridors can support long-term competitiveness in a tightening regulatory environment.
This phased strategy allows shipping companies to decarbonize in line with regulations, strengthen their position in the logistics chain and benefit from the near-term advantages of LPG.