GREEN corridors will remain unviable without targeted policy help, according to a new report.

Green consultancy Umas, the UCL Energy Institute and the Global Maritime Forum said more than 60 green corridors had been announced so far, with varying stages of readiness.

Green corridors are first-mover initiatives where ships and ports at either end of a shipping route work together to test green fuels. They were much hyped in 2021 as a way to start shipping’s green transition.

But the higher costs relative to fossil fuels have stymied progress.

“Without a considerable level of willingness to pay for green shipping from customers, or regulations and measures that either oblige or support early mover adoption of zero-emission fuels, this cost gap presents the most critical obstacle for the execution of these projects,” the report said.

It said regulations by the International Maritime Organization, the EU and the US Inflation Reduction Act would help reduce the cost gap, but would not close it.

In particular, the report found that an IMO greenhouse gas fuel standard with a flexibility mechanism for compliance — one of the policy options on the table at IMO, and the one backed by opponents of a carbon levy — was unlikely to lead to green shipping corridors before 2040.

Getting green corridors to work would mean switching from buying bunkers on a spot basis to long offtake agreements for green e-fuels — around 10 years.

This meant containerships and gas carriers would have an easier time than bulkers.

Gas carriers had an ideal opportunity to form an emerging trade in e-ammonia, since ships using their cargo as fuel did not need separate bunkering infrastructure or bunker offtake agreements.

GMF decarbonisation director Jesse Fahnestock said: “The most important role green corridors can play is to co-ordinate and kick-start the value chain for tomorrow’s shipping fuels.

“Participants in corridors will need to be creative in how they leverage a range of regulations, but it’s clear from this work that the scale of their impact will depend on policymakers delivering targeted support for e-fuels.”