The agency that operates the Cape May-Lewes Ferry has spent years planning for a new vehicle ferry that will connect New Jersey and Delaware across Delaware Bay. As the design took shape, the ferry’s propulsion system remained a question mark.
The Delaware Bay and River Authority, the multistate agency that operates the ferry system, now has more certainty thanks to a $20 million grant from the Federal Transit Authority (FTA). The money, announced earlier this fall, will offset costs from installing a hybrid-electric power plant.
“The cost of just making the ferry hybrid versus just clean diesel is estimated to be about 20 percent more,” said Heath Gehrke, the agency’s director of ferry operations, who estimates the new vessel will cost about $80 million. “If we didn’t get the grant money,” he continued, “we might have just pulled back and said, ‘Let’s not put the batteries on there; let’s not have the battery compartments and the fire suppression and cabling done initially and leave it to where we can call it hybrid-ready.’”
Billions of dollars in federal, state and local grant funding has emerged in recent years to help vessel operators pay for electric or hybrid-electric propulsion. This money has accelerated the adoption of these technologies, which sharply reduce and, in many cases, eliminate emissions. Much of this funding originated with federal spending packages that became law during President Biden’s term.
Recent examples include nearly $300 million in FTA ferry grants awarded in 2024 to 18 projects, eight of which will have hybrid or hybrid-electric propulsion. That money follows $220 million in ferry grants awarded in 2023 supporting four electric or hybrid projects.
The Environmental Protection Agency recently announced $2.9 billion in funding for 55 projects under its Clean Ports program. Nearly all of the funding – or $2.8 billion in all – went to zero-emission projects. That includes eight projects that will help pay for 20 new electric vessels.
SeaStreak LLC, which operates high-speed passenger ferries between New Jersey and New York City, received almost $55 million to support development of electric vessels and battery propulsion. Grants will also help pay for shore power systems to recharge the ferries.
Port authorities in Michigan, Ohio, Illinois, California and Washington also received Clean Ports funding for zero-emission vessels. A grant worth $55 million for the Port of San Francisco will support SF Bay Ferry’s ongoing efforts to build a fleet of high-speed, zero-emission ferries. SF Bay Ferry also received more than $11 million in state grants to support clean propulsion efforts.
Grant funding is supporting more than just passenger vessels. The Port of Corpus Christi, an export hub for oil and natural gas, received $105 million in Clean Ports funding. Suderman & Young Towing Co., which operates ship-assist tugs in Corpus Christi, will receive money under that grant for an electric tugboat to serve the port. The new 98-by-44-foot tug will deliver 100 tons of bollard pull and have the ability to charge in less than three hours.
“This new tug design, with its power and design flexibility, will set the standard for sustainable and environmentally conscious harbor towing in North America,” Capt. Jay Rivera, chief commercial officer at Suderman & Young, said.
For now, the proposed electric tug is currently in the design and planning stages. Upon completion, it will join Crowley’s eWolf, the lone all-electric tug presently operating in the ship-assist trade in US harbors. Crowley received about $13.67 million in federal, state and local grants to support construction of that vessel, which entered service in San Diego in mid-2024.
Battery-electric propulsion is the most widely adopted zero-emission technology in the maritime industry. The technology is proven, is well understood by regulators and allows for plug-and-propel operations without the need for a new fueling supply chain.
But electric propulsion has some notable challenges. Range is limited, and vessels need to recharge far more often than a conventional vessel would take diesel fuel. Charging infrastructure is also expensive and complicated to build in sought-after waterfront locations, among other challenges.
“In my professional opinion, there are certain applications where electrification makes perfect sense,” said Mike Complita, a principal at the Seattle naval architecture firm Elliott Bay Design Group. “But there are so many vessel service types that electrification will not work for in the foreseeable future.” Development is underway on other technologies that reduce emissions from diesel engines, which have few limitations of electric propulsion. These include diesel particulate filters, carbon capture and exhaust aftertreatment, he said.
For now, there is both a limited market for this equipment and less in the way of grant funding than for zero-emission technologies — two factors that could slow adoption in the maritime space. “That is where, as owners and operators, there is frustration building in the maritime community,” Complita said. “Some operators are wondering, ‘Where is the funding and support for other green applications?’”
Officials with the Cape May-Lewes Ferry expect to go to bid on their new project in 2025. Final design is currently underway on the vessel, which likely will feature MTU Tier 4 engines, Baldor electric motors and two battery banks. The vessel could be complete in 2027. “The ferry will use battery power while at the dock and during maneuvering [as] we work to improve the battery-charging infrastructure at the ports, which will be a multi-year project,” Gehrke said.