Fossil fuels and sustainable fuels are on the path to cost parity within the next few decades as a result of evermore stringent international regulations. Mikael Wideskog, director, sustainable fuels & decarbonisation at Wärtsilä delves into where the industry needs to focus to most effectively harness this parity, namely: investing in fuel flexible technology, addressing the cost of transition and fostering a system of intra and inter-sector collaboration.

The essence of an industry analysis shows that cost parity could be reached between sustainable shipping fuels and fossil fuels by 2035 as decisive emissions policies and regulatory pressure ramp up.

According to recent research from a Wärtsilä report published on sustainable shipping fuels, regulations like the EU Emissions Trading Scheme (ETS) and FuelEU Maritime Initiative (FEUM) could cause a near-doubling of the cost of using fossil fuels by 2030. Furthermore, despite sustainable fuels forecasted to remain three to five times more than today’s fossil fuels, the cost gap between sustainable and fossil fuels could close with the introduction of further regulations.