FuelEU Maritime Monitoring Plan submission

Container-ship-pic-Fuel-EU-Maritime

The FuelEU Maritime Regulation will become effective from 1 January 2025. Accordingly, Ship Management companies are required to submit their FuelEU Maritime Monitoring Plan for verification by 31 August 2024. In light of these requirements, this article aims to offer clarity for those seeking a memory refresh on this matter.

Table of Contents

PREVIEW ON EU MARITIME EMISSIONS POLICIES

Let’s begin by providing some background:

Here’s an overview of EU regulations, requirements, and policies pertaining to emissions within the maritime industry. Given that the FuelEU Maritime regulation is just one aspect of emissions control within this sector, it’s important to provide a brief summary of the broader context in which these regulations have evolved.

On a global scale, the International Maritime Organization (IMO) sets standards for ship emissions. Key IMO regulations, such as MARPOL Annex VI, establish limits on air pollutant emissions like sulfur oxides (SOx) and nitrogen oxides (NOx) for ships operating in international waters, including those registered in EU nations. Furthermore, the IMO has introduced the Energy Efficiency Design Index (EEDI) for new ships and the Energy Efficiency Existing Ship Index (EEXI) for existing vessels, both aimed at enhancing energy efficiency and curbing greenhouse gas emissions.

Returning to Europe, the EU is dedicated to reducing greenhouse gas emissions from the maritime sector in alignment with broader climate objectives. This commitment is underscored by initiatives outlined in the European Green Deal and the EU’s long-term emissions reduction strategy, targeting climate neutrality by 2050. To achieve these goals, policies may encompass measures to encourage the adoption of low-carbon and alternative fuels, enhance energy efficiency, and incentivize emissions reductions throughout the maritime industry.

THE EU EMISSIONS TRADING SYSTEM

The European Union Emissions Trading System (EU ETS) was established by the European Union to regulate greenhouse gas emissions from industries and power plants within its member states. It operates on the principle of cap and trade, wherein a cap is placed on the total amount of greenhouse gas emissions allowed from covered sectors. Over time, this cap decreases, aiming to achieve emissions reductions in line with EU climate targets. Emission allowances are either allocated or auctioned to companies, and these allowances can be traded among participants.

Affected companies must surrender allowances equal to their emissions at the end of each compliance period. They are also required to monitor and report their emissions, with these reports subject to verification by independent auditors to ensure compliance with EU ETS regulations. Initially focused on stationary sources and industrial facilities, the EU ETS was extended to include emissions in the maritime sector starting 1 January 2024. In this regard, the exisiting MRV Regulation (see below) has been updated.

MONITORING, REPORTING, AND VERIFICATION (MRV) REGULATION

The EU MRV Regulation requires ships over 5,000 gross tons calling at EU ports to monitor and report their CO2 emissions and other relevant information. Starting 1 Jan 2025, the requirement will extend to vessels from 400 GT and include offshore vessels as well, which were not included before. This regulation aims to increase transparency and accountability for shipping emissions and inform future policy decisions. MRV and ETS are currently interrelated.

You can read the full text of the updated MRV Reguation here: Regulation – 2023/957 – EN – EUR-Lex (europa.eu).

The updated MRV Regulation above is intended “to provide for the inclusion of maritime transport activities in the EU Emissions Trading System and for the monitoring, reporting and verification of emissions of additional greenhouse gases and emissions from additional ship types (Text with EEA relevance)”.

THE FuelEU MARITIME REGULATION

The FuelEU Maritime Regulation was adopted in July 2023 with the intention to promote the use of cleaner energy and support decarbonization in the maritime industry.

Article 1 of Chapter 1 of the Regulation, explains its own objective:

This Regulation establishes standard rules that:

  • Set a cap on the greenhouse gas (GHG) emissions produced by energy used aboard ships when arriving at, staying within, or departing from ports within a Member State’s jurisdiction.
  • Mandate the use of onshore power supply (OPS) or zero-emission technology in ports within a Member State’s jurisdiction.

Its aim is to promote consistent use of renewable and low-carbon fuels and alternative energy sources in maritime transport throughout the Union. This aligns with the goal of achieving Union-wide climate neutrality by 2050, while ensuring smooth maritime transport operations, providing regulatory clarity for adopting renewable and low-carbon fuels and sustainable technologies, and preventing market distortions.

In this context, starting 1 Jan 2025, there will be limits on the yearly average GHG intensity for ships over 5000 GT, of any flag, calling at European ports. GHG stands for GreeHouse Gas and, in this regulation, refers to carbon dioxide (CO2), methane (CH4), and nitrous oxide (N2O). GHG intensity is measured in equivalent grams of CO2 per megajoule of energy (gCO2e/MJ).

The limits are based on a reference value of 91.16 gCO2e/MJ corresponding to 2020 and a variable reducing factor that becomes more stringent over the years before reaching carbon neutrality by 2050. The reducing factor until 2025 is only 2%, but will be as much as 80% during the 5 years before 2050.

Interestingly, the FuelEU Maritime Regulation takes a Well-to-Wake (WtW) approach, meaning that GHG emissions are computed considering not only the gases emitted for energy generation directly but also the equivalent effect related to fuel extraction (from the well) and downstream processes until it is burnt onboard and left behind (wake).

The new regulation also requires that container and passenger ships use On-shore Power Supply (OPS), or alternative clean technologies, in port.

The responsible party for compliance with FuelEU Maritime is the Ship Management Company as defined for ISM purposes, and a given company can meet the requirements by considering the combined figures resulting from a fleet of ships, meaning that compliance for each individual vessel is not strictly necessary. Ships can trade any surplus margin in their GHG intensity figures in favor of another ship or even reserve a certain unused margin for subsequent yearly periods. These trades are subject to specific rules and conditions that we will not delve into in this article, but it goes to show the flexibility that a company has in dealing with the required limits. It is important to note that there will be penalties for companies not meeting the required limits.

THE FuelEU MARITIME MONITORING PLAN

For vessels trading in the EU, an approved FuelEU Maritime Monitoring Plan shall be onboard before 1 January 2025. However, before that point, Ship Managers must submit their FuelEU Maritime Monitoring Plan for verification (normally, Classification Societies can perform such verification). The Plan should define the monitoring and reporting procedures to be used by the company, and it should be submitted by 31 August 2024, which is only a few months from the time this article is being written (May 2024).

The monitoring plan shall consist of a complete and transparent documentation. Below are some of the elements that it should include. Please refer to the original document, Article 8 for full details.

– Vessel data, such as IMO number and other information normally included in a Ship’s Particulars sheet.

– Description of the machinery involved in energy process and the power figures.

– Electrical  power consumption in port (normally found in the electrical load booklet of the vessel).

– Sources of energy that the ship will use at sea and in port.

– Procedures used to monitor fuel consumption or consumption of alternative energy sources, along with procedures to monitor important reporting activity, such as determining time the ship is at sea or at berth, etc.

– Records of historical revisions

– Relevant information for specific cases like wind propulsion,…

– etc.

Assuming that the plan above  is complete and correct according to the FuelEU Maritime regulation, the verifier (normally the Class Society) shall record it in the FuelEU database. The monitoring plan (and any modified monitoring plan if applicable) shall be accessible to the administering State.

REPORTING – THE Fuel EU REPORT

From 1 January 2025, based on the monitoring plan above and following the assessment of that plan by the verifier, companies shall submit the so-called FuelEU report. This report is specific to any vessel of 5000 GT and above calling European ports, and should include the necessary information to calculate the average GHG intensity for the reported year along with various details used to determine the degree of compliance, the total energy used in the year, etc.

It is worth noting that, for trips where one of the ports (whether departure or arrrival) is not in Mainland Europe, only 50% of the energy used in the voyage is computed. 

Apart from voyage details and consumption figures for all types of fuels used, the information to be reported includes the relevant data of the OPS (On-Shore Power Supply) consumption as applicable, and the data necessary to calculate the well-to-tank and tank to wake contribution of each fuel to the GHG intensity.

In the case of Ice ships, specific data shall be added to the report.

Once above calculations are completed, the verifier (Normally, the Classificattion Society), shall revert to the Company with the results for the GHG Intensity, the compliance balance (meaning the surplus or deficit over the limit), the number of non-compliant ports during the reported year, and the total energy figures for the year.

The FuelEU report is to be recorded in the FuelEU database along with the verification report and the results mentioned above.

To read the EUFuel Maritime Regulation in full, you can use this link:

Regulation – 2023/1805 – EN – EUR-Lex (europa.eu)

Meet the Author

Hello all, my name is Pablo, a former Chief Engineer at Sea, with extensive experience ashore as well, including roles like Technical Manager.

In my free time, I enjoy crafting posts for this Blogs section. Your comments and thoughts on the topics discussed, or even on the puzzles, are greatly appreciated.

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