Global shipping association BIMCO has adopted a new Biofuel Clause for Time Charter Parties, providing a standardized contractual framework to facilitate the growing use of biofuels as the maritime industry accelerates its transition toward lower-carbon operations.
The new clause addresses key legal, technical, and operational challenges associated with biofuel use in shipping, including fuel quality, engine compatibility, performance implications, and liability allocation between shipowners and charterers.
According to Stinne Taiger Ivø, the clause is the result of extensive consultations with shipowners, charterers, fuel specialists, and P&I clubs, ensuring that both safety and technical requirements are comprehensively addressed.
The Biofuel Clause establishes clear definitions and fuel specifications aligned with ISO standards while outlining procedures for fuel sampling, testing, storage, handling, and consumption. It also includes mechanisms to adjust vessel performance calculations when biofuels with different calorific values are used, ensuring fair treatment of existing speed and fuel consumption warranties under charter party agreements.
In addition, the clause incorporates safeguards relating to fuel stability, segregation of fuel batches, and storage life, reflecting industry best practices for the safe onboard use of biofuels.
Nicholas Fell said the clause provides a clear framework defining specification standards and the respective responsibilities of owners and charterers when biofuels are supplied and consumed.
The adoption of the Biofuel Clause forms part of BIMCO’s broader efforts to develop contractual solutions for alternative fuels. The organization has previously introduced an LNG Annex to the BIMCO Bunker Terms 2018 and related LNG fuel supply clauses, while a Methanol Annex and methanol bunkering provisions have also been adopted. BIMCO is expected to begin work on an ammonia-focused annex later this year, further supporting the maritime sector’s transition to cleaner fuel alternatives.