The shipping sector
From January 2024, the shipping sector will gradually be included in the EU Emissions Trading System (EU ETS). The sector will be fully included in the system by 2026.
The amended EU ETS directive, adopted in 2023, will contribute to delivering on the EU’s climate targets for 2030 and 2050 by increasing the use of renewable and low-carbon fuels in maritime transport. Initially, larger ships over 5,000 gross tonnages and above are covered for the period 2024-2026. From 2027, the limit will be lowered to ships of 400 gross tonnages.
The system covers:
- 100 per cent of emissions that occur between two EU ports and when ships are within EU ports.
- 100 per cent of emissions from voyages of a distance up to 300 nautical miles from an EU port.
- 50 per cent of emissions from voyages starting or ending outside of the EU.
Actors who fall under the obligations
The actors under EU ETS obligations are shipping companies, which can be one of the following:
- The ship owner, which is the registered owner and can be either a juridical or natural person
- An ISM-company, which has assumed the management of the ship in accordance with Regulation (EC) No 336/2006 of the European Parliament and of the Council of 15 February 2006on the implementation of the International Safety Management Code within the Community and repealing Council Regulation (EC) No 3051/95
Shipping companies with Sweden as administrative authority are the ones registered in Sweden, as well as shipping companies with a majority of post-of-calls in Sweden or who started or ended their first journey under EU ETS in Sweden. The European Commission published a list of shipping companies falling under EU ETS at the end of January 2024 and will be updating this list every other year. All shipping companies with EU ETS obligation was not included on this list, however, and shipping companies may have to contact THETIS-MRV for help and to be attributed to a member state in order to fullfil their obligations.
Contact the THETIS-MRV helpdesk
Information for maritime operators
Starting from January 2024, shipping companies are obligated to report their verified emissions to the Swedish Environmental Protection Agency. The monitoring plans and emissions reports shall be submitted through THETIS-MRV. Shipping companies that are registered in Sweden or has Sweden as administrating EU Member State are required to open a maritime operator holding account in the Swedish part of the Union Registry to report and surrender emission allowances.
In order to surrender emission allowances shipping companies will need to acquire general EU allowances (EUA). EUA are the same ones used by industry, power sector and aircraft operators. EUA are available for purchase on the European Energy Exchange (EEX). The EU has currently contracted with EEX, covering its 27 Member States. Additionally, allowances can be traded among all companies that have accounts in the Union Registry.
Furthermore, the entity responsible for compliance with the ETS obligations shall also be responsible for compliance with MRV obligations, according to the MRV Regulation (EU) 2023/957.
There will be no free allocation of emissions rights within the shipping sector.
Timeline for the incorporation of the shipping sector
Once emissions data have been verified by the administering authority, companies must surrender the equivalent number of allowances in the Union Registry. For shipping companies, the first surrender occurs by September 30, 2025, for the emissions reported in 2024. During an initial phase-in period, shipping companies will only have to surrender allowances in the Union Registry for a portion of their emissions.
In 2024, shipping companies will be able to open maritime holding accounts in the Union Registry. Only carbon dioxide emission (CO2) will be reported, and ships over 5000 gross tonnages will be covered.
The percentage of emissions that must be covered by emissions rights increase every year:
In 2025, shipping companies will be required to surrender allowances for 40 per cent of their emissions reported in 2024.
• In 2026, shipping companies will be required to surrender allowances for 70 per cent of their emissions reported in 2025. By January 2026, the system will also cover methane (CH4) and nitrous oxide (N2O) emissions.
• From 2027 and beyond, shipping companies will be required to surrender allowances for 100 per cent of their reported emissions for the previous year. The limit will be lowered to ships of 400 gross tonnages.
