26 June 2024 (Lloyd's List) - COST and inadequate supply chain infrastructure will be the biggest barriers to a sustainable fuel transition, a transport industry survey found.

Law firm Reed Smith surveyed its clients across aviation, logistics, utilities, manufacturing, environmental services and shipping.

Almost half of the 47 respondents thought that it would take more than 15 years for transport to be powered by fully sustainable fuels.

Nearly half of respondents said dual fuel and LNG would act as a transitional fuel in the next three-to-five years. A similar share cited biofuel and green hydrogen as the two sustainable fuel sources they thought had the most potential for broad application in transport.

Reed Smith partner Nick Austin the concerns about cost and regulatory restrictions were no surprise. 

“This reflects our experience in maritime decarbonisation, where companies are facing new costs, such as the EU Emissions Trading System tax, and a range of other initiatives such as the International Maritime Organization’s Carbon Intensity Indicator, which impose both an administrative and economic burden on vessels to reduce emissions,” he said.

“The reality is that a fundamental change in marine fuels will inevitably require both higher cost and new regulation.”

Austin said his clients were concerned at governments’ lack of commitment from global governments to support new infrastructure to get sustainable fuels to market.

“That will require considerable investment in ports and other land-based facilities at a time of economic uncertainty in many places,” he said.