EU ETS for Shipping: Your 2025 Compliance Roadmap
The EU ETS began covering shipping emissions from January 2024, requiring operators of vessels above 5,000 gross tonnage to surrender allowances for a share of their verified emissions on voyages within and to/from the EU. The roadmap for 2025 involves increasing the surrender obligation and expanding coverage to smaller vessels by 2027.
Shipping in the EU ETS
Maritime transport accounted for approximately 2.6% of global CO₂ emissions in 2023, emphasising the need for sector-wide decarbonisation. The inclusion of shipping in the EU ETS expands carbon pricing to this traditionally under-regulated sector.
Key Milestones for 2025
Vessels in Scope: Ships above 5,000 gross tonnage operating in the European Economic Area (EEA). Coverage applies to intra-EEA voyages and voyages to/from EEA ports.
Incremental Surrender Obligation: Operators must surrender allowances equivalent to verified emissions covering:
40% in 2024,
70% in 2025,
100% in 2026.
Extended Inclusion: Smaller ships from 400 gross tonnage may be included starting in 2027.
Account Requirements: Operators need Union Registry accounts for emissions tracking and allowance transactions; Grey Epoch offers solutions for companies awaiting registry setup.
Penalties: Non-compliance results in fines of €100 per missing allowance, plus further surrender obligations. Repeated failure may lead to vessel detention or entry bans.
Proceeds partly funded towards maritime innovation and decarbonisation projects.
The Key to Success
Several European shipping companies have rapidly upgraded onboard emission tracking technology to satisfy EU MRV regulations, some reporting emissions reduction strategies in route optimisation and engine efficiency. Companies active with forward allowance purchases via platforms like Grey Epoch report smoother compliance and budgeting.
Planning Ahead:
Business Implications
Shipping firms leveraging carbon markets proactively can manage pricing risk, enhance operational efficiency, and bolster environmental credentials with customers and regulators. Early adopters position themselves favorably in a decarbonising maritime economy.
Strategic Steps to Prepare
Understand regulatory responsibilities and compliance obligations.
Develop emissions monitoring and reporting capabilities.
Engage in forward purchasing and hedging to manage price risks.
Explore spot trading options for flexible allowance management.
Market Evolutions to Watch
The EU aims to integrate maritime ETS revenues into funding for sustainable ports and cleaner vessels. Innovations in alternative fuels could further shift the landscape, adding new compliance dimensions later in the decade.
How Grey Epoch Supports Ship Owners
As the second-largest ETS trader globally, Grey Epoch supports shipping with competitive pricing, market liquidity, and flexible purchasing options, including deferred payments. Our expertise reduces complexity and ensures timely registry delivery.
Contact Grey Epoch to tailor a carbon compliance strategy that fits your fleet’s operational and financial needs.
