No single technology can deliver lower-carbon global freight, new report finds

August 25, 2026

New research highlights the distinct safety, infrastructure and investment risk profiles of maritime, road, rail and air freight as the industries move away from fossil fuels.

The transition to lower-carbon freight transportation will require a combination of fuels and technologies to meet the varying needs of maritime, road, rail and air transport, according to a new Reuters Events report produced in association with global commercial insurer AXA XL.

Freight in a low-carbon economy: Managing the risks finds while readily available alternative energy sources may offer limited reductions in greenhouse gas emissions in the transport sector, technologies with greater decarbonization potential can introduce significant safety, infrastructure, cost and regulatory challenges.

Commenting on the findings, Vicky Roberts-Mills, Global Head of Energy Transition at AXA XL, said:
"As we move to a low-carbon economy, the future energy mix is going to become a lot more complex. There will be more local production, more flexibility, and more diversification. Transportation is at the heart of that transformation.

“Freight operators are assessing technologies that are advancing at varying speeds, creating distinct risk profiles. Insurers can help create confidence to invest by improving understanding of those risks and helping businesses deploy new technologies safely and at scale.”

Maritime: no clear technology winner

The challenge is particularly acute in the maritime sector, which carries an estimated 90% of the world’s freight. The report compares nine alternative fuels and propulsion systems for commercial shipping across criteria including cost, emissions reduction, infrastructure, scalability, safety and regulatory readiness – and finds no clear winner.

Shipping will likely use a mix of technologies tailored to vessel type, route and operating requirements. Ammonia, for example, could reduce greenhouse gas emissions by around 90% compared with traditional marine fuel oil when produced using hydrogen created through renewable-powered electrolysis, but its toxicity, lower energy density and infrastructure needs pose storage, bunkering and emergency-response challenges.

Road: higher repair costs and downtime

Battery-electric vehicles are increasingly expected to outcompete hydrogen fuel-cell vehicles across most road-transport segments, but they present a distinct loss profile. Although accident frequency may be comparable or lower, they can cost 20% to 25% more to repair than equivalent internal-combustion vehicles after similar damage. Battery replacement, specialist-skills shortages and limited repair capacity can also extend downtime and increase financial losses for freight operators.

Rail and aviation: uneven pathways to transition

Rail electrification is established in some markets but remains uneven and impractical on certain freight routes, while alternatives require further infrastructure and investment. Aviation’s transition remains largely dependent on alternative fuels, such as biofuels that are difficult to scale and synthetic fuels that remain costly and scarce.

The findings call for closer collaboration among transport operators, energy providers, technology developers, regulators, investors and insurers. They also show how risk consulting, specialist insurance, captive structures, and political risk, credit and bond insurance can help businesses manage the technological, operational and financial exposures associated with lower-carbon transportation.

The full report, Freight in a low-carbon economy: Managing the risks, is available here.

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ABOUT AXA XL INSURANCE

AXA XL Insurance offers property, casualty, professional, financial lines, and specialty insurance solutions to mid-sized companies through to large multinationals globally. We partner with those who move the world forward. To learn more, visit www.axaxl.com