Lloyd’s Register’s latest 'Engine Retrofit Report: Applying alternative fuels to existing ships (2026 update)' says the marine sector’s engine retrofit capability advanced during 2025, even though regulatory uncertainty continued to hold back major conversion decisions.

The classification society said that the longer conventionally fuelled ships remain in operation, the greater the pressure to retrofit them later to meet emissions targets, potentially concentrating demand into a shorter, more expensive period.

According to Lloyd’s Register (LR), 2025 saw only modest growth in publicly announced retrofit projects, but a clearer improvement in industry capability. Among the examples highlighted in the report is the methanol retrofit of a large two-stroke engine on the container vessel Cosco Shipping Libra, which LR said shows that methanol conversion is technically feasible for deep-sea ships and is moving closer to becoming a repeatable solution.

The report also points to broader retrofit offerings from engine technology providers, including Everllence, Wärtsilä and WinGD for LNG and ethanol during the year. LR said LNG is still attracting interest as a lower-cost transition fuel, while ethanol is emerging as a more credible marine fuel option, backed by operator trials and original equipment manufacturer developments.

Maersk’s trials found that Brazilian ethanol could be blended with methanol and marine diesel without affecting engine performance, allowing for higher ethanol blends. LR also noted that Everllence reported positive results across all load points for both two-stroke and four-stroke engines, while WinGD announced a retrofit-applicable roadmap for ethanol-fuelled two-stroke engines.

The report added that the similarities between methanol and ethanol mean future methanol engines should be able to use ethanol, while existing methanol engines may be converted comparatively easily.

LNG retrofits, meanwhile, remain under discussion with shipowners, supported by established fuel infrastructure and the longer-term possibility of switching to bioLNG or synthetic methane. LR added that upgrades aimed at reducing methane slip from dual-fuel engines are also drawing increasing attention.

Despite the limited number of major conversion announcements, the report said so-called bridge retrofits continued to gain ground, including engine upgrades, propulsion optimisation and control system improvements. These measures can cut emissions in the near term and prepare ships for later fuel conversion, although they also compete for shipyard slots and engineering capacity.

LR said future retrofit activity will depend heavily on regulatory progress, particularly whether a global framework emerges to encourage zero- and near-zero-emission fuels.

Mark Penfold, Global Head of Technology – Engineering, Lloyd’s Register, commented: “A clear and consistent regulatory signal is the single biggest factor that will unlock investment at scale. Without that, the industry will continue to prepare—but not fully commit.

“Regardless of the timing of regulation, a substantial retrofit market is inevitable. As the existing fleet remains central to global trade, the ability to convert vessels efficiently will be critical to meeting decarbonisation targets.”

The report is part of LR’s Retrofit Research programme, which tracks demand, capability and adoption trends across the ship retrofit market through annual reports, publications and tools.