Waste heat recovery for meeting the air conditioning demand of a ship is reported. An absorption refrigeration system is proposed. Water-LiBr is used as the working pairs for this purpose. A steady-state energy, exergy, and environmental analysis is done to compare the proposed system with the conventional system. Exhaust gases of auxiliary engines are used to vaporize high-pressure water. High-pressure steam is employed as a heat source for the generator of the absorption system. The results show that exhaust gases of the auxiliary engine as a permanent heat source suffice for the generator of the absorption system. For tropical conditions, the required power for the absorption system is much lower than that for the conventional system. $$ {\dot{\Big(W}}_{\mathrm{demand}} $$ for the absorption system is 0.02, while it is 88.28 for the conventional system). The second law of thermodynamics shows a 31% lower total irreversibility in the proposed system versus the conventional system. The use of the absorption system causes a USD 45,078 saving in the yearly penalty cost of CO2 emission.