Japan puts hydrogen, ammonia, and methanol ships in line for subsidies | Maritime

Japan has launched a call for proposals under its $94.8m five-year scheme supporting hydrogen and derivative-fuelled shipping.

The initiative from the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) and the Ministry of the Environment makes hydrogen- and ammonia-powered ships eligible for 50% government funding on equipment costs, while hydrogen-based methanol ships could claim 33%.

Battery-powered ships can also claim up to 50% of costs, with hybrid battery vessels eligible for 33%.

It also offers a subsidy for green steel used in ships, calculated at ¥60,000 ($377) per tonne and subsidised at up to 50%, rising to two-thirds for companies that have made a declaration under Japan’s Green Transformation initiative.

It aims to decarbonise Japan’s maritime fleet and advance its shipbuilding industry in line with international marine decarbonisation.

While the role of hydrogen in low-carbon maritime mobility remains unclear, operators of large vessels are increasingly turning to derivatives like ammonia and methanol as fuel.

However, nascency, a lack of global bunkering infrastructure, high costs, and safety concerns remain key barriers to adoption.

The IMO’s Net Zero framework plans to impose a carbon levy on ships above 5,000 tonnes from 2028, while the EU’s FuelEU Maritime regulation already sets carbon pricing for ships of this size using EU ports.

Japan’s Kawasaki Heavy Industries has put significant effort into hydrogen-based maritime propulsion, including developing what it billed the “world’s first” hydrogen-fuelled ship engine.