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Hydrogen

Shipping's $200M Green Hydrogen Bet Goes Global

Published by Todd Bush on October 16, 2025

The global maritime industry just moved closer to a historic transformation. On the first day of a crucial summit in London this week, the majority of countries voiced strong support for the International Maritime Organization's Net-Zero Framework, a plan that could unlock massive demand for green hydrogen-based fuels. Despite opposition from some nations, the framework is gaining momentum and positioning green ammonia and methanol as the fuels of choice for decarbonizing the world's shipping fleet.

The framework isn't just regulatory policy. It's a market signal worth billions, and it's telling fuel producers one thing: start building. According to estimates, implementing this framework would require about 200 million tonnes of green ammonia and methanol by 2040.

Framework by the Numbers

  • 200 million tonnes of green ammonia and methanol needed by 2040
  • 85% of shipping CO2 emissions covered by new rules
  • 43% reduction in fuel intensity required by 2035
  • 2027 entry into force if adopted this week
  • 63 countries voted in favor during April approval

What's Actually Happening in London

The four-day meeting, which began October 14, 2025, will determine whether the global maritime sector introduces mandatory rules to reduce emissions. If adopted, these regulations would become the first globally binding emissions limits and greenhouse gas pricing mechanism for an entire industry sector. All European nations have already expressed backing for the framework, alongside major players like China, Brazil, the UK, and Canada.

The Net-Zero Framework targets ships with 5,000 gross tonnage or larger, which account for about 85% of international shipping's CO2 emissions. The framework includes two main components: a global fuel standard requiring ships to reduce their greenhouse gas fuel intensity by 43% by 2035 compared to 2008 levels, and a pricing mechanism that charges vessels exceeding emission thresholds.

ammonia-fueled cargo ship

>> In Other News: Exxon Baytown FID Prospects Increasingly Slim For 2025

Green Hydrogen Takes Center Stage

The framework creates a clear pathway for green ammonia and methanol to become dominant shipping fuels. Ships that emit above set thresholds will need to purchase remedial units or offset emissions through the IMO Net-Zero Fund. Meanwhile, vessels using zero or near-zero emissions technologies can earn surplus credits, creating financial incentives to adopt cleaner fuels.

The math is straightforward. Global ammonia production currently sits at just under 200 million tonnes annually. Using ammonia in shipping could essentially double that market between now and 2050, creating unprecedented opportunities for hydrogen hub developers and fuel producers worldwide.

Jonas Moberg

"The IMO's decision today sends an important signal to green fuels producers to go forward with their projects. The compromise reached fails to place a universal levy on shipping emissions which means technologies like LNG will persist for longer than necessary, but it is now clear that near zero emissions fuels like green ammonia will play an ever larger role in shipping."

Jonas Moberg, CEO, Green Hydrogen Organisation

Industry Response: Optimism Mixed with Urgency

The framework has sparked diverse reactions across the maritime and energy sectors. The Ammonia Energy Association and multiple industry players have issued a unified message: the framework might not be perfect, but it needs to be adopted in October. Their reasoning is simple. Adoption will provide the business case certainty needed for clean ammonia and other zero-emission fuels to scale commercially.

Investment is already flowing. Companies are betting big on blue ammonia facilities in Texas and Louisiana, with projects worth over $5 billion positioning these states as clean energy powerhouses. These investments hinge on regulatory certainty, making the October vote crucial for maintaining momentum.

Three Reasons Companies Are Backing the Framework

1. Market Clarity: The framework establishes clear compliance pathways and reward mechanisms, allowing companies to model long-term investments with confidence. Ships meeting ambitious targets earn surplus units they can sell, creating immediate revenue opportunities.

2. Fuel Diversity: Unlike prescriptive mandates, the framework allows shipowners to choose from multiple pathways including green ammonia, methanol, and other sustainable fuels. This flexibility encourages innovation while maintaining environmental rigor.

3. Global Consistency: A unified international standard prevents the fragmentation that would result from dozens of regional rules. Companies can plan fleet-wide strategies rather than navigating a patchwork of conflicting regulations.

Gulf Coast hydrogen hub facility

The Technology Is Ready

Unlike previous climate initiatives hampered by immature technology, the tools for maritime decarbonization already exist. Ammonia-fueled engines are in development, with major manufacturers delivering dual-fuel systems that can transition from conventional fuels to green alternatives. Bunkering infrastructure is expanding at key ports worldwide, including Rotterdam, Singapore, and major U.S. Gulf Coast facilities.

The challenge isn't technological readiness but scaling production. Green hydrogen production for ammonia synthesis requires massive electrolyzer capacity and renewable energy infrastructure. The framework addresses this by creating guaranteed future demand, giving producers the confidence to invest in multi-billion-dollar facilities today.

Fuel Type Carbon Intensity Production Status 2040 Demand Projection
Green Ammonia Near-zero (0-5 gCO2eq/MJ) Pilot/early commercial 100-150 million tonnes
Green Methanol Near-zero (0-5 gCO2eq/MJ) Early commercial 50-100 million tonnes
Conventional Fuel Oil High (93.3 gCO2eq/MJ) Mature/declining Phasing out

Regional Implications: North America's Opportunity

North America is particularly well-positioned to capitalize on shipping's green transition. The U.S. Gulf Coast already hosts multiple carbon capture and blue ammonia projects, with Louisiana and Texas emerging as clean fuel production centers. These facilities benefit from existing natural gas infrastructure, carbon storage geology, and port access.

The Mid-Atlantic Clean Hydrogen Hub and other regional initiatives are developing the production capacity and distribution networks needed to supply maritime fuel. Canada is advancing similar infrastructure, while Mexico's Pacific ports could become strategic refueling locations for trans-Pacific routes.

Arsenio Dominguez

"The approval of draft amendments to MARPOL Annex VI mandating the IMO net-zero framework represents another significant step in our collective efforts to combat climate change, to modernize shipping and demonstrates that IMO delivers on its commitments."

Arsenio Dominguez, Secretary-General, International Maritime Organization

Opposition and Challenges Remain

Not everyone supports the framework. During the April approval vote, 16 countries opposed the draft, including Saudi Arabia, UAE, Kuwait, Iraq, Qatar, Oman, Bahrain, Iran, Indonesia, Malaysia, Pakistan, Thailand, Russia, and Venezuela. These nations collectively represent about 7.6% of global merchant fleet tonnage and raised concerns about costs, fuel availability, and impacts on developing economies.

The United States delegation also expressed reservations, though the specifics of their objections remain under discussion. Some industry voices have called for delays, arguing that green fuel production capacity isn't scaling fast enough to meet compliance timelines. Others worry that penalties aren't high enough to drive rapid adoption of zero-emission fuels.

IMO Secretary-General Arsenio Dominguez has acknowledged these concerns while emphasizing the need for action. He warned that prolonged uncertainty would deter investment and lead to fragmented regional regulations, ultimately increasing transition costs for everyone.

Timeline: What Happens Next

The October meeting runs through October 17, with adoption requiring a two-thirds majority of MARPOL Annex VI signatories. Currently, 108 countries are party to the convention, and at least 63 votes supported the framework during April's procedural approval. If adopted this week, the framework enters force in 2027, with compliance requirements beginning in 2028.

Implementation guidelines will be developed throughout 2026 and 2027, covering critical details like emissions calculation methodologies, certification schemes for zero-emission fuels, and governance provisions for the Net-Zero Fund. These guidelines will determine how effectively the framework drives investment in green hydrogen production and maritime infrastructure.

Key Milestones Ahead

  • October 17, 2025: Final vote on framework adoption
  • Spring 2026: Approval of implementation guidelines at MEPC 84
  • 2027: Framework enters into force 16 months after adoption
  • 2028: Compliance requirements begin for qualifying vessels
  • 2030: First major checkpoint: 20-30% emissions reduction target

Economic Impact: Jobs and Growth

The framework's economic implications extend far beyond fuel production. Shipyards will retrofit existing vessels and build new dual-fuel ships. Port operators will invest in bunkering infrastructure and storage facilities. Engineering firms will design and construct electrolyzer plants and renewable energy installations. The entire supply chain will mobilize to meet shipping's transformation.

Estimates suggest over $1 trillion in investment will be needed to fully decarbonize the shipping industry by 2050. While that sounds daunting, it represents opportunity for companies positioned to deliver solutions. Early movers in green ammonia production, carbon capture technology, and maritime engineering stand to capture significant market share as regulations tighten.

Regional hydrogen hubs are already positioning themselves as suppliers to maritime markets. The Appalachian Regional Clean Hydrogen Hub includes ammonia production as a core component, while Gulf Coast facilities are explicitly targeting shipping fuel markets. These projects create construction jobs, permanent operational positions, and indirect employment throughout local economies.

The Bigger Picture

Maritime shipping carries approximately 80% of global trade by volume. Decarbonizing this sector isn't just an environmental imperative but an economic necessity as carbon-conscious consumers and regulations reshape international commerce. Countries and companies that lead in clean shipping fuels will gain competitive advantages in global trade networks.

The framework also demonstrates that international cooperation on climate action remains possible despite geopolitical tensions. Getting 63 countries to agree on binding emissions targets and financial mechanisms for an entire industry sector represents a significant diplomatic achievement. It shows that practical solutions can emerge when the economic case aligns with environmental goals.

Green hydrogen and its derivatives are central to this transition. Unlike batteries, which work well for short-range vessels, ammonia and methanol offer the energy density needed for transoceanic shipping. They can be produced anywhere with renewable energy and water, creating opportunities for countries to develop domestic fuel security while advancing climate objectives.

Momentum Building

The strong majority support on day one of the London summit suggests the framework will likely be adopted. European unanimity, combined with backing from major economies like China, Brazil, Canada, and the UK, creates substantial momentum. Even accounting for opposition, the vote appears headed toward the two-thirds threshold needed for passage.

Adoption would mark the beginning of implementation challenges, not the end of debate. Questions about fuel certification, emissions monitoring, fund governance, and technology verification will require ongoing negotiation. But having a framework in place provides the foundation for these discussions and the market signal that drives investment decisions today.

For companies in the hydrogen and carbon capture sectors, the message is clear: shipping's green transition is happening. The framework creates massive demand for sustainable fuels, and producers who scale quickly will capture significant market share. The next few years will determine which companies, regions, and technologies lead this transformation.

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