$10-M price gap tests electric ferry shift
Ferry operators face a costly transition to cleaner vessels, with electric ferries requiring up to $10 million more in upfront investment than conventional ships, even as long-term fuel savings could make the shift commercially viable.
The Department of Transportation (DOTr), through the Maritime Industry Authority (MARINA), is preparing to pilot electric ferries along the Iloilo-Bacolod route and hybrid vessels between Batangas and Calapan to assess their commercial viability.
A World Bank study showed that despite the higher acquisition cost, electric ferries could generate returns exceeding 8 percent, supported by savings on fuel expenses.
Conventional ferries could spend between $25 million and $50 million on fuel alone over 15 years, depending on oil prices.
World Bank Senior Port and Maritime Transport Specialist Ninan Biju Oommen said operators could recover their investments without passing additional costs to passengers.
“If you extend the life cycle time for a 15-year operating cycle, you don’t need to increase the fares. The model has ensured that you can recover the cost without increasing the fares,” Oommen said.
MARINA Overseas Shipping Service Director II Ramon Hernandez said shifting to electric propulsion could help address the industry’s exposure to high fuel costs while reducing carbon emissions.
“These e-ferries will solve some of the issues and concerns we have regarding, first, the environment. It will reduce carbon dioxide emissions from ships. It will also address the high cost of fuel oil. When you shift to electric, power consumption costs will decrease somewhat. And that will also have an effect on fares for our commuters, for the public using water transportation,” Hernandez said.
The agency identified routes carrying at least 500,000 passengers annually as particularly suitable for electric ferry operations.
MARINA is also considering retrofitting existing vessels with electric or hybrid systems, potentially reducing the need for operators to acquire entirely new ships.
Archipelago Philippine Ferries Corp. President Christopher Pastrana, whose company operates about 20 FastCat vessels nationwide, has expressed willingness to retrofit one vessel with electric propulsion for the pilot.
The transition could also create opportunities for Philippine shipyards through technology partnerships with Norwegian vessel designers.
The government is pursuing the initiative as roughly 300 inter-island ferries account for about 86 percent of carbon dioxide emissions from the country’s domestic ferry fleet.
The Philippines recorded around 69 million maritime passenger trips in 2025, served by approximately 4,000 domestic passenger vessels.
The DOTr and MARINA will meet with shipowners, development partners and other stakeholders in Iloilo on November 4 to discuss financing, vessel technology, charging infrastructure and retrofitting requirements for the proposed pilot.