Asian Ship Owners Brace For Over $1 Billion Emissions Bill In EU-Bound Voyages

• Asian shipping companies are expected to face emissions costs exceeding $1.1 billion for voyages to and from Europe under the EU Emissions Trading System (EU ETS).
• The EU ETS will fully enforce regulations, requiring Asian vessel owners to surrender around 1516 million EU Allowances (EUAs) for 50% of emissions from these voyages.
• The estimated cost for Asian owners is projected to be approximately $540 million in 2024, increasing to 100% by 2026 during the phasein period. Major players, including China’s COSCO and Hong Kongbased AngloEastern Ship Management, are among the 400 affected Document of Compliance holders.

EU ETS Impact on Asian Shipping

Asian ship owners are expected to face emissions costs exceeding $1.1 billion for voyages to and from Europe under the fully enforced EU Emissions Trading System (EU ETS).
The EU ETS regulations require Asian vessel owners to surrender approximately 1516 million EU Allowances (EUAs) for 50% of emissions from these voyages.

Cost Breakdown and Projections

The estimated EU ETS costs for Asian owners are approximately $540 million in 2024, with liabilities for 40% of emissions, increasing to 70% in 2025 and reaching 100% in 2026 during the threeyear phasein period. Major players, including China’s COSCO, Hong Kongbased AngloEastern Ship Management, and South Korea’s HMM, are among the 400 affected Document of Compliance holders.

Challenges and Mitigation Strategies

Asian shipping companies may face challenges, including administrative obstacles and delayed finalization of Implementation Acts by the EU, placing nonEU players in a disadvantageous position. OceanScore is aiding shipping companies, both within and outside the EU, in establishing administrative frameworks to navigate the intricacies of the EU ETS, offering solutions like the webbased ETS Manager.

Note: The EU ETS imposes emissions costs on Asian ship owners, with projections indicating a substantial financial impact on the industry.

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