To help achieve its net zero ambitions, the EU actively promotes renewable and zero carbon fuels and uses onshore power at berth for ships over 5000 GT. This is part of its plan to reduce annual greenhouse gas (GHG) intensity from shipping by 80% by 2050, against a 2020 baseline.
Known as FuelEU, this legislation requires ships to monitor and report the GHG intensity of energy used onboard and introduces penalties for non-compliance. Ships must meet a series of yearly deadlines to track GHG emissions intensity using methodologies set out in FuelEU Monitoring Plans.
FuelEU maritime regulation
- What is the FuelEU Maritime Regulation?
- Advice for shipowners and ship managers
- Our solutions
- Class News
- Frequently asked questions
FuelEU Maritime requires ship owners, managers or charterers to accelerate the uptake of renewable and low-carbon fuels in maritime transport, and cement the use of onshore power during port stays of more than two hours.
Introduced by the European Union (EU), this regulation (Regulation (EU) 2023/1805 ) aims to drastically reduce onboard greenhouse gas (GHG) emissions by 2050 and forms a substantive part of the EU’s Fit For 55 package to reduce GHG emissions from shipping. It also gives ship operators and fuel producers legal certainty by increasing the demand for renewable and low-carbon fuels.
How does FuelEU work?
Applying to ships over 5000 GT, FuelEU sets targets to reduce the GHG (CO2, CH4 and N2O) intensity of energy used onboard against a 2020 baseline. The chart below shows the reductions at 5-year intervals.
Above: Reduction in GHG intensity of energy used on board from 2020 levels (%).
'GHG intensity' is a measure of the total CO2-equivalent emissions onboard a ship between January and December in any given year. Measurements are based on reported fuel consumption, from EU MRV, and the emission factors of the fuels used, including emissions from production to transportation, bunkering and end-use (known as ‘well-to-wake'), as described in Annex I of FuelEU. Track your ship’s emissions and create Monitoring Plans using LR Emissions Verifier.
FuelEU promotes low or zero carbon fuels but is technology agnostic. Any combination of technologies and fuels can be used that best suits the ship owner, manager or charterer to reduce GHG intensity of energy used onboard.
In the short term, wind assistance, optimised journeys and efficient propellers could all improve journey efficiency. In the medium to long term low or zero carbon fuels with much lower GHG intensity will have the greatest impact.
Financial penalties will be due if owners, managers or charterers cannot meet the reductions required for energy used above the 2020 baseline.
Read LR's guide to managing compliance and optimising operations under the EU's new regime here.
Onshore Power
To drastically reduce onboard emissions during port stays, passenger and container ships must connect to onshore power supplies at major EU ports from 2030, and all EU ports with onshore power supplies from 2035.
Ships using zero-emission technology at berth will be exempt, as will very short stays of less than two hours. Port contraventions will be subject to financial penalties.
RFNBOs
From 1 January 2025, the European Commission will monitor and incentivise the uptake of Renewable Fuels of non-Biological Origin (RFNBOs), also known as e-fuels, including e-diesel, e-methanol, e-LNG, e-hydrogen, e-ammonia, e-LPG and e-dimethyl ether (DME).
If the share of RFNBOs is less than 1% of all fuel usage within scope of the regulation between 1 January and 31 December 2031, then a sub target will mandate 2% RFNBOs from 1 January 2034.
Flexibility compliance mechanisms
To maximise FuelEU compliance and minimise penalties, ship owners, managers or charterers may bank or borrow savings in GHG intensity, or pool savings within or between fleets. These approaches are known as ‘flexibility compliance mechanisms’.
In any one year, ship owners, managers or charterers can bank unused GHG emissions from an over-compliant ship, to use on that same ship in the next reporting period. Or they may pool any unused emissions from one ship with under-compliant ships in a common pool. Pooling can be applied either within a fleet or between fleets where a contractual agreement is in place. While individual ships can use different verifiers, each pool must be logged with a single verifier.
For ships which do not comply in any one year, it's possible to pool the unused emissions from another ship or ships in the fleet, as described above. Or ship owners, managers or charterers may borrow unused emissions for the same ship from the next reporting period. However, those choosing this option must pay back the surplus, plus an 10% surcharge, from that ship’s next reporting period.
What do ship owners, managers or charterers need to do?
The ship’s ISM company/Document of compliance (DoC) holder is responsible for FuelEU compliance. Each year, owners, managers or charterers operating cargo and passenger ships of 5000GT and above calling at an EEA port will need to:
- By 31st August prepare and submit monitoring plans to verifiers for approval.
- From 1 January 2025 collect and report data according to the monitoring plan, for:
- 100% of energy used for voyages between two EEA ports of call and at berth, on a well-to-wake basis.
- 50% of energy used for voyages between EEA and non-EU ports.
- By 30 June 2026 obtain a valid FuelEU DoC for the ship.
For more detail see the FuelEU timetable for compliance.
