The maritime industry sits at the center of one of the most challenging decarbonization positions. With global shipping responsible for roughly 3% of worldwide CO₂ emissions and new regulations applying mounting pressure, the sector needs scalable low-carbon fuels as quickly as possible.
Marine biofuels have emerged as one of the most feasible near-term options in shipping. They offer immediate carbon-intensity reductions, often require minimal engine modifications, and can act as true “drop-in” replacements for conventional marine diesel.
Yet despite their promise, marine biofuels face their own set of headwinds. Competition from the road transport sector, energy-density disadvantages, supply constraints, and uncertainty around future production pathways are all significant challenges.
Today, marine bio-bunkering stands at a crossroads. The industry is assuredly growing fast, but it is limited by the bottlenecks that define the broader advanced biofuels market.
Two regulatory forces are accelerating the shift toward low-carbon marine fuels:
Biofuels such as FAME, HVO, and renewable synthetic diesel offer a direct, compliance-ready pathway. These options avoid the operational disruption of LNG (liquefied natural gas), ammonia, hydrogen, or methanol retrofits.
Together, these forces create demand certainty, encouraging more suppliers to invest in bunkering-grade biofuel production. But demand certainty and demand capacity are two different things.
Scaling remains a challenge across the biofuel industry. As we see increases in biofuel adoption, production itself has seen a strain. The dynamic has left some supply challenges with direct impacts in the marine biofuels sector.
According to recent IBIA Convention 2025 discussions, the road sector consumes the overwhelming majority of available biofuel supply. In particular, road transport utilizes HVO/renewable diesel, the very fuels shipping would most prefer to use.
Why does road transport win in this scenario?
And why does the marine industry only gets what’s left?
In practice, the marine industry is a growing demand center, but it's not yet a priority allocation for producers. The result is an uneven supply landscape with price premiums and availability fluctuating by port, season, and competing road-sector pull.
Even when supply is available, marine biofuels come with a built-in challenge:
they contain less energy per liter than conventional marine diesel.
Typical energy densities:
Accordingly, these findings yield multiple operational implications:
For long-haul deep-sea vessels, these density penalties are especially problematic. A small percentage difference can translate into major operational impacts (and increased costs).
This is one reason why bunkering suppliers report that biofuel adoption is easiest in short-sea and regional ferry segments first—but not in deep-sea freight.
Emerging technologies aim to overcome the energy-density challenge:
Power-to-Liquid (PtL) Synthetic Fuels:
Algal Biofuels:
These “next-gen” fuels could make marine biofuels a no-compromise solution.
But they will likely not reach large-scale commercial availability until the 2030s.
Even with supply and density challenges, marine biofuels remain the lowest-friction pathway to compliance. These fuels…
For many operators, the strategy is shifting toward dual-fuel or blended approaches:
This hybrid model is the dominant short-term compliance strategy.
Marine biofuels offer the most practical, immediate, and scalable pathway to reducing emissions from shipping today. But their growth is constrained by two realities:
Despite these challenges, regulatory momentum and technological progress are pushing the market forward. Marine biofuels may not yet be the final destination for maritime decarbonization. But they are the most viable bridge fueling the journey.
With strategic investment, improved supply chains, and next-generation fuels on the horizon, bio-bunkering is positioned to evolve from a compliance tool into a core component of zero-carbon maritime operations.
The bio-bunkering industry is moving quickly. With regulations, emerging technologies, and new adoption sites, keeping up with what's next will pose a serious challenge.
To help make it easier for you, join us for a live webinar covering the 2026 biofuels market:
Mat Stone, ResourceWise's VP of Business Development and Low Carbon Fuels, will address a wide range of topics relevant to the biofuels and bio-bunkering market:
You won't want to miss this critical update on what to watch out for in the biofuels market for the year ahead. Register today to secure your spot.