5 Most important EU Rules and Regulations for Maritime Industry
FuelEU Maritime / EU ETS / AFID / RED / ETD
Summary - As a shipowner, you will be required to pay a carbon tax of €200-€300 per mT fuel, implement shore power, and use low carbon fuels by 2024-2030. Create a mitigation plan now by contacting the helpdesk for assistance.
This blog briefly highlights key rules and regulations for EU as per January 2023. Contact the helpdesk to clarify any questions.
EU has shipping in its sights
The European Union is one of the leading governments when it comes to sustainability ambitions. They recognize that maritime transport plays an essential role in the EU economy and is one of the most energy-efficient modes of transport, but also that it is a growing source of greenhouse gas emissions. Emissions are projected to increase from 90% to as much as 130% of 2008 by 2050. At EU level, maritime transport represents 3 to 4% of the EU’s total CO2 emissions.
The relatively slow progress in the IMO has triggered the EU to take action and make new proposals to make sure maritime transport plays its part in achieving climate neutrality in Europe by 2050. This started in 2013, when the Commission set out a strategy towards reducing emissions from the shipping industry. In 2019, the European Green Deal was signed to ensure the EU achieves 55% reduction of emissions by 2030 compared to 1990 levels.
The EU has consistently pushed for higher environmental ambitions than the IMO and is in all regards more stringent than IMO legislation. Especially the last two years have seen an acceleration of decarbonization legislation, exemplified by the European Climate Law and Fit for 55 package.
European Climate Law
One of the core elements of the European Green Deal is the European Climate Law. A provisional agreement on this Climate Law was reached on April 21, 2021. The European Climate Law outlines a framework for the irreversible and gradual reduction of greenhouse gas emissions and legally establishes the goal of a climate-neutral Europe by 2050.
The European Climate Law does not define precisely which measures member states need to make, but it does define what should be taken into account when adopting concrete rules and regulations. One example is the competitiveness of the EU economy (i.e. the level playing field), and the best available techniques for decarbonization. Furthermore, it states that member states must prepare and implement adaptation strategies and plans. The European Climate Law also introduces measures for monitoring progress. Every five years, the European Commission will evaluate the collective progress and the measures available, and, if necessary, will take action.
Fit for 55
On July 14 2021, the European Commission adopted the Fit for 55 package, a roadmap that explains how the EU intends to reduce its net greenhouse gas emissions to 55% by 2030. This legislative package comprises a dozen revised and new pieces of legislation on multiple different topics (energy efficiency, renewables, transport, emissions trading and reduction, etc.), to reach the CO2 reduction targets of 55% below 1990 levels by 2030. Fit for 55 affects all industrial sectors – including shipping – in particular with the above mentioned legislation.
References
EU - Reducing emissions from the shipping sector
EU - Review of EU ETS
Stibbeblog - The European Climate Law explained
The ETD is the principal taxing scheme used for fossil and low-carbon fuels in EU. Fossil fuels will be taxed more, and renewable low-carbon fuels will receive incentives, including shore power.