A new EU regulation mandates a 2% cut in greenhouse gas intensity for ships, adding to fuel costs and driving decarbonisation efforts.
The European Union’s FuelEU Maritime regulation, effective January 1, 2025, is set to reshape the shipping industry by enforcing a 2% reduction in greenhouse gas intensity for vessel energy use. This rule is anticipated to increase fuel costs for shippers, with actual expenses depending on compliance strategies.
Shippers can mitigate these costs by integrating biofuels like B30, which could raise expenses by $30 per tonne of fuel. Alternatively, pooling with other vessels using low-emission fuels like e-methanol could reduce the added costs to less than $20 per tonne. Ignoring the regulation may result in penalties of $65 per tonne for continued reliance on heavy fuel oil.
This initiative follows mounting pressure on the global shipping sector to curb emissions, which total hundreds of millions of tonnes annually. The new rule complements the EU’s Emissions Trading System, aiming to accelerate decarbonisation by imposing stricter requirements on vessels operating within and outside EU waters, with further tightening scheduled from 2030.
Nicholas Fell of BIMCO highlighted the transformative impact of the regulation, stating it will significantly alter industry dynamics, surpassing the influence of the EU emissions trading system.
