The Maersk McKinney Møller Center for Zero Carbon Shipping’s September 2024 pre-feasibility study on battery-powered vessels has injected a critical and thoughtful perspective into the maritime electrification debate. It rightly highlights battery-hybrid propulsion as a cornerstone for decarbonizing shipping, recognising the substantial efficiency gains that batteries offer over traditional internal combustion engines and underlining how partial electrification can significantly cut greenhouse gas emissions and local air pollution. These conclusions align well with the growing momentum behind sustainable shipping technologies.
However, while the study’s direction is sound, its core economic assumptions—particularly regarding battery system prices—appear outdated and considerably overestimated. The economic modelling used a battery price assumption of around $300 per kWh, with sensitivity analyses only extending down to $200 per kWh. At these values, the study suggested that battery-electric hybrids, especially for deeper sea and medium-range routes, were only marginally or even cost-neutral compared to alternative fuels. The conclusion was that such hybrids would require ideal conditions or substantial policy support to reach breakeven economics.
This narrative has shifted dramatically. Real-world auctions in China as of mid-2025 report lithium iron phosphate (LFP) battery prices as low as $51 per kWh, with previous large-scale contracts in late 2024 pricing batteries at $65 per kWh. These figures represent a steep decline—roughly a sixth of the study’s original battery cost assumptions—and revolutionise the economic viability landscape for battery-hybrids in maritime shipping.
LFP batteries bring strategic advantages for shipping too. Their chemistry, characterised by inherently lower thermal runaway risk compared to nickel-based cells commonly used in road electric vehicles, makes them safer and easier to incorporate onboard with less complex and costly fire prevention systems. This aspect is critical in the marine environment where safety compliance is paramount. Additionally, maritime vessels have fewer weight and volume constraints than road vehicles, allowing for simpler battery packs that accommodate the slightly lower energy density of LFP cells without degrading cargo capacity or operational efficiency.
Revisiting the Maersk Center’s model with the updated battery price of $51 per kWh fundamentally transforms the economic narrative. For instance, in the 1,100 TEU feeder vessel scenario, a battery hybrid previously only marginally competitive against methanol-fuelled vessels now shows a lifecycle cost advantage of about 24%, translating to millions of dollars saved over 20 years. Similarly, bulk carriers and tankers, which under the higher battery pricing seemed less economically promising, now project total cost ownership reductions exceeding 18% to over 30%. The implication is clear: routes and vessels formerly considered economically marginal for battery hybridisation become solidly viable.
This cost transformation also extends operational capabilities by justifying larger battery packs, thus increasing electric sailing ranges and boosting battery energy share from the previously modelled 80% up to 95%. The feasible electric voyage distance for feeder ships, for example, stretches roughly to 1,700 nautical miles—enough to cross the Atlantic on battery power alone, using current Chinese LFP battery prices. This scaling of battery-electric propulsion signals a shift from experimental trials to practical, widespread adoption. Pacific routes could see 50 to 60% of their distance powered by batteries, making battery-hybrid systems the cheapest option operationally.
The Maersk study also assumed conservative, arguably worst-case cost scenarios for alternative low-carbon fuels like synthetic biomethanol, projecting prices far above those of traditional very low sulfur fuel oil (VLSFO). Current understanding suggests these liquid fuels will remain multiple times more expensive than VLSFO, reinforcing the economic case for battery hybrids even further. This disparity underlines that while Maersk’s report was directionally accurate, it underestimated the scale and speed of both battery price reductions and synthetic fuel cost inflation.
Beyond ship economics, this battery cost revolution shifts the critical bottleneck towards shore-side infrastructure development. Ports worldwide must rapidly upscale their capacity for high-power charging, renewable electricity generation, and potentially battery swapping facilities to meet the rising power demand from electric and hybrid vessels at berth. Some ports in Scandinavia and China are already making significant investments, demonstrating early proof of concept. The speed and scale of this infrastructure rollout will likely determine the pace of maritime electrification in the near term.
Furthermore, regulatory and policy frameworks must evolve in tandem. The International Maritime Organization’s emerging carbon pricing policies, broader emission control zones, and tightening European Union emissions standards strengthen the case for battery-hybrid vessels becoming the economically preferred choice across much of the fleet. Policymakers should therefore align incentives and infrastructure funding to support this energy transition promptly.
This battery price collapse mirrors patterns observed in renewable energy sectors like wind and solar power, where forecasts rapidly became outdated as market prices plummeted. The Maersk McKinney Møller Center identified battery-hybrid propulsion as the strategic future for shipping; however, their economic modelling did not fully anticipate the rapid cost advances now reshaping the market. Similarly, their projections for synthetic fuel prices appear markedly conservative given current trajectories. Updated, rigorous technoeconomic assessments incorporating these realities would provide stakeholders with clearer, more actionable breakeven points.
In conclusion, battery-electric propulsion is no longer a distant vision or niche alternative; it is emerging as the practical, economically compelling core of maritime decarbonization today. Shipping companies and maritime infrastructure planners that recognise and act on this swiftly stand to secure a competitive advantage in a rapidly evolving industry landscape. The maritime future, fundamentally reshaped by affordable batteries and shifting fuel costs, signals a decisive step towards cleaner, more efficient ocean transport. The focus now must be on accelerating port infrastructure readiness, regulatory adaptation, and fleet investment to harness this transformative opportunity.
Source: Noah Wire Services
