Driving the green transition in shipping
The maritime industry is undergoing a significant transformation, and at the heart of this change is the EU's ambitious new initiative – FuelEU Maritime. As the shipping sector plays a critical role in global trade and transportation, it also has a substantial impact on the environment. FuelEU Maritime aims to address this by steering the industry towards cleaner, more sustainable practices.
What is FuelEU Maritime?
FuelEU Maritime is part of the European Green Deal, a comprehensive plan by the European Union to achieve climate neutrality by 2050. This initiative specifically targets the shipping industry, with a focus on reducing greenhouse gas emissions from maritime transport. The primary goal of FuelEU Maritime is to accelerate the adoption of alternative fuels and energy-efficient technologies in ships arriving at EU ports.
The regulation introduces a gradual increase in the use of sustainable and low-carbon fuels in the maritime sector, setting ambitious targets for reducing the carbon intensity of energy used on board. By encouraging the uptake of cleaner fuel alternatives, such as biofuels, hydrogen, and electricity, the initiative aims to reduce emissions and create a more sustainable shipping industry.
When will FuelEU Maritime take effect?
FuelEU Maritime will officially come into force in January 2025. From this date, all ships over 5,000 gross tonnage that operate in EU waters, regardless of their flag, will be required to comply with the new fuel requirements. The regulation will introduce increasingly stringent targets for reducing greenhouse gas emissions over the coming decades, with a focus on promoting innovation and fostering a market for sustainable maritime fuels.
Below is a scheme that provides a clear overview of the FuelEU Maritime implementation timeline, outlining the key requirements and the types of ships included.
Overview of the FuelEU Maritime implementation timeline
The below timeline outlines the key deadlines and activities required for vessel operators to comply with FuelEU regulations, including the submission of monitoring plans, reporting, and issuance of compliance documents.
31st August 2024
Submit the monitoring plan to the verifier for each vessel.
1st January – 31st December 2024
Monitoring period for each vessel on EEA voyages.
31st December 2024
End of the monitoring period.
31st January 2025
Submit the FuelEU report for each vessel.
30th June 2025
Issuance of the FuelEU compliance document.
Penalties under the FuelEU regulations are calculated based on the difference between the fuel used and the greenhouse gas (GHG) target, multiplied by 2,400 EUR. For compliance, operators can bank any surplus of emissions allowances, utilise a borrowing mechanism if in deficit, or employ a pooling mechanism that enables investments in specific vessels within a larger fleet. Additionally, certain vessels may qualify for exemptions until 31st December 2030, subject to a request and dependent on their trade activities.
What does this mean for the shipping industry?
For shipowners, operators, and other stakeholders, FuelEU Maritime represents a significant shift in operational practices and long-term strategy. Companies will need to invest in new technologies, optimise their operations, and explore partnerships to ensure compliance. The regulation is expected to drive demand for sustainable fuels and encourage the development of new solutions that reduce the carbon footprint of shipping.
Stay prepared with OSK Design
At OSK Design, we are committed to helping our clients navigate these upcoming regulatory changes. From design adaptations to compliance strategies, our team is here to support your transition to a greener future.
One of the key aspects of the FuelEU Maritime regulation is its pooling mechanism, which allows low-emission vessels using fuels like RFNBO to be pooled within your business or with other operators. This enables you to share the compliance balance of a low-emission vessel with other vessels in your fleet that may not have a surplus, ensuring a more balanced approach to meeting emission targets.
Additionally, the regulation provides a “banking and borrowing” mechanism, allowing compliance balances to be carried over from one year to another within a specified framework. These mechanisms offer flexibility in managing compliance and reduce the immediate burden on operators.
Our experts at OSK Design can help you leverage these mechanisms effectively, providing tailored solutions to maximise your compliance options. Reach out to us for tailored solutions and stay updated with the latest developments on our news page.
