Sunita Somvanshi
The Department of Energy announced on February 28 that it has removed barriers for using liquefied natural gas (LNG) as marine fuel. This regulatory change modifies a previous order issued to JAX LNG under the Biden administration that had created new oversight requirements for LNG bunkering, the process of fueling ships with LNG.
“Today’s action is a significant step in reducing regulatory burdens and helping this important segment of the LNG market continue to grow,” said Tala Goudarzi, Principal Deputy Assistant Secretary of the Office of Fossil Energy and Carbon Management.
The order specifically withdraws DOE jurisdiction under the Natural Gas Act for ship-to-ship transfers of LNG for marine fuel use at U.S. ports, in U.S. waters, or in international waters. Only bunkering activity involving ship-to-ship transfers of U.S. LNG when the receiving ship is in foreign territorial waters will continue to be regulated as exports.
Industry Impact and Environmental Considerations
JAX LNG, the facility at the center of this regulatory change, is a small-scale coastal LNG operation located near Jacksonville, Florida. It supplies LNG fuel to various vessels including cruise ships, car carriers, petroleum tankers, and container ships.
The maritime industry has been increasingly adopting LNG as a fuel source in recent years. According to the International Energy Agency’s January 2025 Quarterly Gas Report, the number of LNG-fueled ships is expected to nearly double to over 1,200 vessels by 2028.
While LNG can reduce emissions of sulfur oxides, nitrogen oxides, and particulate matter compared to traditional marine fuels, environmental groups have expressed concerns about methane slip—the release of unburned methane during LNG use—and the broader climate implications of rolling back regulations.
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Political Context
This regulatory change aligns with the broader policy direction of the Trump administration. Columbia University’s Sabin Center for Climate Change Law has been tracking Trump administration actions to reverse federal climate change mitigation efforts.
Energy Secretary Chris Wright has been criticized by the League of Conservation Voters, which called him a “climate-denying Big Oil executive” according to the source material.
The LNG regulation rollback follows President Trump’s withdrawal from the Paris Climate accords and cuts to the Environmental Protection Agency, including the removal of more than 1,000 employees. Senate Democrats launched an inquiry following allegations that Trump solicited $1 billion from fossil fuel executives for his 2024 campaign with promises to roll back regulations.
Despite concerns from climate advocates, the maritime industry continues to see increased adoption of LNG-powered vessels. As emissions regulations become more stringent globally, shipping companies are increasingly turning to LNG and exploring options like bio-LNG and synthetic LNG to reduce their environmental footprint.
FAQ
What is LNG and why is it used as marine fuel?
Liquefied Natural Gas (LNG) is natural gas that has been cooled to a liquid state. It’s increasingly used as marine fuel because it produces fewer emissions of sulfur oxides, nitrogen oxides, and particulate matter compared to traditional marine fuels, helping ships meet stricter international emissions standards.
What is “LNG bunkering” and why is it regulated?
LNG bunkering refers to the process of storing LNG on ships and transferring it between vessels as fuel. It had been regulated under the Biden administration to provide oversight of ship-to-ship transfers. The Trump administration has now rolled back this regulation to reduce what they describe as regulatory burdens on the LNG industry.
How will this regulatory change affect the shipping industry?
The regulatory rollback is expected to make it easier and potentially less costly for shipping companies to use LNG as fuel for their vessels. Industry projections suggest the number of LNG-fueled ships will nearly double to over 1,200 vessels by 2028, according to the IEA’s January 2025 report.
What are the environmental concerns about using LNG as marine fuel?
While LNG burns cleaner than traditional fuels in terms of certain pollutants, environmental groups are concerned about “methane slip” — the release of unburned methane during the combustion process. Methane is a potent greenhouse gas that can contribute significantly to climate change if released into the atmosphere.
How does this action fit into the Trump administration’s energy policy?
This regulatory rollback is part of the Trump administration’s energy policy, which has included withdrawing from the Paris Climate accords and reducing EPA staffing. The administration has been taking actions to reverse climate change mitigation measures while supporting the fossil fuel industry.
What is JAX LNG and why was it specifically mentioned in this order?
JAX LNG is a small-scale coastal LNG facility located near Jacksonville, Florida that supplies LNG fuel to various vessels including cruise ships and container ships. The DOE’s original regulatory order was specifically issued to JAX LNG under the Biden administration, so the Trump administration’s rollback specifically modifies that order.
