MARINE POLICY: The International Maritime Organization (IMO) introduced Energy EfficiencyDesign Index (EEDI) with an aim to improve energy efficiency of ships. At the same time, the advances in ship power system are oriented towards integrated power system (IPS) designs, which are characterized by centralized total energy production, application of electric propulsion engines and generally higher degree of waste heat utilization. After several years of EEDI implementation, among other difficulties, it became clear that prescribed approach cannot be simply applied to IPS. Based on the extensive analysis of different parameters influencing energy and ecological performances of various IPS configurations, a physically consistent methodology for evaluating energy efficiency of IPS and their effect on the environment is established. Moreover, a new Index of Energy Efficiency and Environmental Eligibility (I4E) is introduced quantifying the ship power system environmental impact, and its applicability to both conventional and IPS is confirmed. Finally, I4E policy implications are discussed, and within its application to a fleet of ro-ro passenger ships, it is confirmed that ships with IPS have lower environmental impact compared to the fleet average, and therefore are more desirable from environmental viewpoint.