As FuelEU Maritime (FEM) regulations tighten, shipowners are navigating an increasingly complex landscape of compliance options, with growing focus on the risks and rewards of alternative fuels. Risto Kariranta, CEO of Ahti Pool—one of the largest FEM compliance pools managing over 250 vessels—says interest in compliance strategies dominated conversations at this week’s Geneva Dry conference.
Kariranta notes that biofuels are currently the most widely used alternative, but warns of looming challenges. Reports of forged volumes of used cooking oil (UCO) and palm oil mill effluent (POME) have raised concerns over certification fraud, prompting the EU to review the integrity of ISCC certifications.
“If enforcement tightens, we’ll likely see a reduction in available biofuel volumes,” Kariranta says. “That will drive prices up and derail the plans of companies that rely too heavily on them.”
In contrast, he sees BioLNG, particularly manure-based variants with negative carbon intensity, as a rising contender in the “advanced alternative fuel” category. While total supply is still limited, BioLNG plays an outsized role in achieving compliance through pooling, offering a strong route to meet strict emission goals under FEM.
“BioLNG isn’t dominant yet, but its impact is growing,” Kariranta explains.
Companies like Neste and Van Weelde, which have joined Ahti Pool, see FEM as a test case in cost-efficiency. Kariranta points out the sharp difference between penalties and compliance costs. Using high-emission fuels like HFO or VLSFO could result in penalties close to $700 per tonne of CO₂ equivalent. By comparison, compliance through low-carbon fuels or pooling strategies may cut that cost by more than half.
He cautions that charterers who adopt standard BIMCO clauses could end up overpaying. “The actual cost of compliance is usually far less than the quoted penalty,” he says.
This price gap creates a strong financial case for investing in greener fuels. “The challenge is real, but so is the incentive,” Kariranta states. “Those who manage the transition well will have a competitive edge.”
Dual-fuel LNG vessels, especially those with access to high-quality BioLNG, are already showing strong performance under FEM. These ships can achieve compliance costs below $100 per tonne of CO₂ equivalent and generate significant overcompliance, which can be traded within pooling systems.
With upcoming changes under the IMO’s NOx Fund (N0F), ships with low methane slip and onboard emissions monitoring are likely to gain favor. Kariranta adds that fossil LNG will soon fall out of compliance, pushing the market further toward advanced low-carbon fuels.
Still, he warns that betting solely on liquid biofuels is risky due to high prices, uncertain supply, and compatibility problems. Methanol has lost momentum because of limited availability and high costs. Ammonia remains speculative with few vessels and minimal green supply, while hydrogen appears years away from large-scale adoption.
“In short, we are at a turning point,” Kariranta concludes. “The fuel decisions made now will shape the industry’s future in a market where regulation, sustainability, and innovation are reshaping the rules.”
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