With marine fuel greenhouse gas (GHG) emissions regulations tightening, shipowners are looking for financially feasible biofuel options. Argus spoke with Leonidas Kanonis, director for communications and analysis at European waste-based and advanced biofuels association (Ewaba), about biofuels for bunkering. Edited highlights follow.
Do you think that the Netherlands government will scrap the HBE-G bio-tickets that it has been allocating for marine fuel for use by ocean-going vessels?
HBEs are not disappearing in 2025, and the Dutch system will continue as normal, including HBE-G bio tickets. In 2026, the plan is that HBEs will be scrapped altogether, when the Dutch system switches to an Emissions Reduction Obligation.
The Emissions Reduction Obligation would be a transposition of the Renewable Energy Directive (REDIII) spanning all transport sectors and HBEs would not exist under such a system.
Annex IX of REDIII lists sustainable biofuel feedstocks for advanced biofuels (Part A) and waste-based biofuels (Part B).
Under the proposed REDIII, EWABA is advocating those fuels made from feedstocks listed under Annex IX B, which include used cooking oil and animal fat, be allowed into the sustainability criteria for maritime transport. Allowing only "advanced" feedstocks listed under Annex IX A would put the Dutch bunkering sector at a cost-and-supply disadvantage compared with non-EU ports.
The Annex IX B exclusion could also put the Netherlands in danger of not hitting its maritime sector target, which rises from a 3.6pc reduction in GHGs in 2026 to 8.2pc in 2030. Annex IX B biodiesel can bridge the gap while advanced technologies such as ammonia and hydrogen are more widely deployed.
The EU imposed anti-dumping taxes on Chinese biodiesel imports in mid-August. What has been the effect on European biodiesel producers?
Following the Chinese anti-dumping duties (ADDs), we have seen an uptick in domestic European waste-based biodiesel prices, widening the spread between the end product and the European domestic feedstock itself. On the other hand, on 1 December, the Chinese government cancelled the export tax rebate for used cooking oil (UCO), disincentivizing Chinese exporters and making Chinese UCO more expensive for European buyers.
It is still early to say what the trend for 2025 will be, but as an industry we are optimistic about increased European biodiesel production. Over the past two years, our members have been suffering, mostly operating at sub-optimal production levels or forced to shut down production. In 2025, there is reserved optimism that the market will improve due to: the ADDs to Chinese biodiesel, the 2025 FuelEU maritime regulation, and the introduction of the EU Database for Biofuels introduced in 2024, which tracks the lifecycle of biofuels and strengthens transparency.
Are there other threats next year that are facing the European waste-based and advanced biofuels producers?
Overall challenges for the market would be demand for feedstock from competing industries, largely the sustainable aviation fuel (SAF) market with the introduction of the ReFuelEU mandate, but also competing regions as the US imported huge amounts of waste feedstocks from China last year, while southeast Asian and UAE countries promote their own bio-blending targets.
Do you think Donald Trump's presidency would affect Europe's biofuel markets?
We expect the Trump administration to possibly limit feedstock imports from outside the US, boosting the sales of local soybean and other crop feedstocks to produce domestic HVO, SAF and biodiesel.
At the same time, the US government has noted they will impose duties on imports coming from anywhere, with China experiencing the most considerable level of duties of up to 60pc. For example, an import tax on European and UK biodiesel would mean that more fuel is available to fulfill the European and UK mandates, as the US is also relying on HVO and FAME from Europe and the UK to fulfill its own mandates.
Biofuel for bunkering has been a popular low-carbon fuel option among container ship companies. But oil tanker owners and dry bulk carrier owners are slower to embrace biofuels. Do you see this changing?
At the moment, most biofuels used in shipping are indeed for container ship companies that could more easily afford higher prices of bio components.
The biofuels industry is receiving a lot of interest from tanker or carrier owners but for lower biofuel blends compared to container ship companies. Container vessels are willing to buy higher biofuel blends and are interested in B100. Oil tankers are focusing more on B15 and higher bio blends to comply with the minimum GHG reduction targets possible. But as the GHG reduction targets on the FuelEU rise, this will of course change as well.
In 2030, what do you project will be the demand for biofuels for bunkering in Europe?
As an estimation, we expect waste biofuels bunkering demand in Europe to surpass 2-2.5mn tons by 2030.
Specification-wise, what are some of biofuel properties that ship owners need to look out for?
We don't believe waste-based and advanced biodiesel fuel properties have considerable issues for ship operators.
Especially for blends up to B30, there is nothing to worry about. For higher blends, viscosity and stability are the ones that I believe are more important. Storage time is also important to consider due to lower oxidative stability of FAME compared with fossil diesel alternatives that could be stored longer term.
