Shipping companies need to act now to prepare for the FuelEU Maritime regulation, as emphasized by Albrecht Grell, co-MD of OceanScore. This regulation is a part of the EU’s Fit for 55 package, aiming to increase the use of renewable and low-carbon fuels in the shipping sector. The deadline for submitting monitoring plans is approaching, and penalties for non-compliance will be significant.
Understanding FuelEU Maritime Requirements
FuelEU Maritime mandates a yearly reduction in the energy used by ships over 5,000 gross tonnes, starting with a 2% reduction in 2025 and reaching 80% by 2050, compared to a 2020 baseline. Non-compliance penalties will be issued on the document of compliance rather than the ‘polluter pays’ principle, highlighting the need for precise fuel monitoring and management.
Implications of Non-Compliance
Friederike Hesse, co-founder and MD of zero44, outlines that penalties will depend on factors such as fuel mix and trading patterns. With limited green fuel options available by 2025, strategies like pooling and forwarding penalties will be crucial. Additionally, the regulation adds costs to those already imposed by the EU Emissions Trading System (ETS), which taxes carbon emissions and incentivizes fuel reduction strategies.
Investing in Green Fuels
FuelEU Maritime focuses on the quality of the fuel burnt, pushing the industry towards alternative low-GHG fuels. As Hesse explains, merely reducing fuel consumption isn’t enough; the emphasis is on reducing the GHG intensity of the fuel mix. By 2026, with the full implementation of the EU ETS, the pressure to invest in green fuels and zero-emission ships will intensify, rewarding compliance and penalizing inaction.
Shipping companies must prioritize these preparations to navigate the upcoming regulatory landscape effectively and avoid substantial penalties.
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Source: The Loadstar
