Clarksons: global fleet value hits US$2Tn, alternative fuels make up half of 2024 orderbook

Newbuilding ship orders in 2024: green technology and alternative fuel uptake 

Progress in the uptake of lower-carbon fuel options in newbuild ordering continued in an economic climate of heavy investment in newbuild vessels in 2024.

Shipyard output and new orders reached their highest levels in more than 15 years, according to Clarksons, with newbuild contracts up 34% year-on-year.

"With overall newbuild order volumes reaching their highest level since 2007, alternative fuel has continued to play a prominent role, representing 50% of all tonnage ordered in 2024," Clarksons Research global director Steve Gordon said in the company’s Green Technology Tracker report.

Over the course of 2024, Clarksons Research reported 820 vessels ordered with alternative fuel capability for a total capacity of 62.2M gross tonnes (gt). Among those alternative fuel capable newbuild orders, some 93 vessels (10.1M gt) were LNG carriers and the balance of 727 vessels from other segments (52.1M gt) represented "a record level of investment," Clarksons said.

The Clarksons report showed a marked return to orders for LNG dual-fuel technology, which had lost market share to methanol in 2023. In 2024, LNG dual-fuel covered 70% of the alternative-fuelled tonnage ordered excluding LNG carriers. This was up from 43% in 2023, with methanol declining to 14% market share from 30% in 2023. 

"Overall, we have reported orders for vessels capable of using either LNG (390 orders, 297 excluding LNG carriers), methanol (118 orders), ammonia (25 orders), LPG (72 orders) or hydrogen (12 orders)," the Clarksons Research figures showed.

Adding to the 50% of newbuilds that were ordered with the ability to run on fuels other than traditional heavy fuel oils that were the industry standard fuels for decades, more than 20% of the remaining vessels ordered were designed to incorporate alternative fuel technologies, particularly methanol and ammonia, at a later date.

"Orders involving ’ready’ status have increased to around a fifth of all orders (452 orders, 21% of tonnage ordered). Across the fuel types, ammonia and methanol have been prominent as alternative fuel ready choices (ammonia: 130 orders, methanol: 320)," Clarksons said.

With 100% of LNG carrier tonnage ordered in 2024 being LNG dual-fuel capable and 90% of the other gas-carrying vessel types ordered to be capable of running on their primary cargoes (LPG/ethane/ammonia dual fuel, respectively), container ships and car carriers made strong showings in orders for LNG dual-fuel and methanol dual-fuel vessels. 

"The 12,000+ TEU container ship segment (71% LNG, 17% methanol) and car carriers (78% LNG, 21% methanol) had the highest levels of alternative fuel order adoption in 2024," the report said.

Tankers lagged behind other sectors, and the lowest share of alternative fuel uptake in 2024 came in the Ultramax (4%), Handysize (4%) and MR (1%) tanker segments.

"With the confirmed orderbook... we forecast that over a fifth of all fleet capacity will be alternative fuel capable by 2030," Clarksons Research projected, representing substantial growth from 2017 when 2% of fleet capacity on the water was alternative fuel capable. Clarksons figures show that, in 2024, 8% of the fleet on the water can run on alternative fuels.

The Clarkons report showed that 276 ports offer LNG bunkering and 275 ports have a shore power connection point in place or planned, while only 35 ports offer or have plans to offer methanol bunkering.

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