The September 2024 pre-feasibility study from the Maersk McKinney Møller Center on battery-powered vessels, which crossed my desk today, provides a welcome and thoughtful addition to the critical discussion of maritime electrification. The report rightly identifies battery-hybrid propulsion as an essential part of shipping’s decarbonization toolkit. It demonstrates a clear understanding that batteries offer significant efficiency gains over internal combustion and that partial electrification can sharply reduce greenhouse gas emissions and local air pollution. These conclusions are correct, insightful, and align with rapidly emerging market realities. However, the core assumptions underpinning the economic modeling, specifically regarding battery system prices, fall short in two major ways.
The Maersk study built its economic analysis on a battery system price of around $300 per kWh. Even their sensitivity tests considered costs down to only $200 per kWh. At these price points, the economics of battery-electric hybrids for maritime transport, particularly on deep-sea and medium-range routes, appeared marginal or at best cost-neutral. The study concluded that hybrid container feeders, tankers, and bulk carriers could achieve breakeven economics against alternative-fuel vessels only under ideal circumstances or with substantial policy support. But this economic framing was already outdated. In July 2025, the most recent auctions for large-scale lithium iron phosphate (LFP) battery storage systems in China cleared at just $51 per kWh. This is not a projection or hypothetical scenario, but a real-world market price confirmed through competitive tendering. This is after a December 2024 price point of $65 per kWh for a 16 GWh auction, just three months after the study was published.
The significance of this price cannot be overstated, as it fundamentally alters the economic feasibility landscape the Maersk Institute sketched out. At roughly one-sixth of the cost the Institute assumed, battery systems become dramatically cheaper than anticipated, profoundly changing the total cost of ownership calculations for battery-hybrid maritime propulsion. LFP batteries and the Chinese BESS price point align well with the operational needs and safety requirements of maritime shipping. Unlike nickel-based chemistries used extensively in road EVs, LFP cells exhibit inherently lower thermal runaway risk, significantly improving maritime safety standards and simplifying onboard fire prevention systems. This reduced fire hazard translates into simpler and less expensive safety compliance, crucial in the maritime industry. Further, maritime vessels, unlike road vehicles, have fewer weight and volume constraints, with only cargo vs batteries vs energy cost optimization providing a constraint, allowing the slightly lower energy density of LFP batteries to be comfortably accommodated. The simpler packs and robust thermal stability of LFP batteries align with shipping’s safety-driven regulatory environment, making their rapidly declining costs and proven reliability highly attractive for large-scale maritime electrification.
The 2022 Nature study from Berkeley Lab researchers found 3,000 km (1,600 nautical mile) journeys were breakeven at $50 per kWh. While somewhat flawed, it was indicative. The modeling from the Institute is in the right vein, as was the Berkeley Lab study, and both are welcomed as hybridization of major ships isn’t on the radar particularly, with dual-energy systems for larger vessels currently being LNG and VLSFO (very low sulfur fuel oil) or methanol and VLSFO. As I noted recently with a mea culpa article, I’m now of the opinion that biomethanol will be the dominant liquid energy carrier for shipping as aviation will bid heavy vegetable oils required for both shipping fuel and aviation fuels up above the price of biomethanol. I’m late to this opinion, and hence the mea culpa. It’s going to be 5–6 times the cost of VLSFO. Meanwhile, e-methanol will be 9–10 times the cost of VLSFO in reality.
Recalculating the Maersk Institute’s breakeven analyses using the actual recent battery price of $51 per kWh demonstrates that battery-electric hybrids transition from being marginally competitive to significantly cost-effective. Taking the 1,100 TEU feeder vessel scenario the Institute analyzed as a baseline example, at their original $300 per kWh assumption, the hybrid configuration was roughly at parity economically with a methanol-fueled equivalent. With battery costs now proven at $51 per kWh, the battery hybrid emerges as about 24% cheaper over the 20-year lifecycle, translating into tens of millions of dollars saved per vessel. This is not a subtle difference. It transforms the economic narrative entirely. This pattern repeats across other vessel types the Institute analyzed. For example, the 40,000 deadweight ton product tanker, previously just marginally competitive in the Baltic Sea trade at the higher battery cost, becomes highly advantageous at the new battery price. At $51 per