Oslo-listed Hoegh Autoliners has teamed up with energy company VARO Energy to develop biofuel solutions.

The Switzerland-based company is a joint venture between investment firm Carlyle Group and Vitol, the Dutch energy group with business operations in fossil fuel supplies and distribution, e-mobility and a growing focus on renewables.

VARO will supply Hoegh Autoliners with various blends of advanced biofuels to help showcase potential ahead of regulations forcing shipping to reduce vessel emissions.

For VARO, it helps search for new customers in a new market as it builds on its transformation strategy away from fossil fuel infrastructure. This transformation also means moving away from biofuel feedstocks sourced from food and animal feed sources and to more recognised sustainable sources.

For Hoegh Autoliners, this contract can build on its experience from earlier trials using blends of biofuels on its vessels. It has already signed agreements with some of its car manufacturer customers, such as BMW, which pays additional costs for the addition of biofuel in normal fuel mix during a voyage. The shipowner said it has seen an increasing number of customers opting for biofuels.

Recently one of the Norwegian company’s vessels, the Hoegh Target, made a voyage from Sweden using 100% biofuels. The company has told TradeWinds that it is keen to avoid using first-generation crops such as palm oil as a fuel, and one of its main sources is from used cooking oils.