EU transport ministers will discuss the FuelEU Maritime proposal during the meeting of the Transport Council on 9 December. The discussions in the Council have reflected, so far, the main concerns of the industry, i.e., the enforcement loopholes arising from making fuel blends purchased outside the EU subject to the new Regulation.
Using paper documents provided by non-EU fuel suppliers to calculate carbon savings may create an enforcement minefield. European shipowners put forward a new proposal aiming to address enforcement issues and to foster demand for cleaner fuels in shipping.
The European Community Shipowners’ Associations (ECSA) published the technical annex to its position paper on the FuelEU Maritime proposal. European shipowners propose the introduction of a shared responsibility between the EU fuel suppliers and the shipping sector.
Both EU fuel suppliers and shipping companies will have to comply with the EU fuel standards and meet the targets of the new Regulation. EU fuel suppliers will have to make cleaner fuels available in the market and ships will have to purchase these fuels made available at EU ports. Fuel suppliers will be responsible for the availability and for the compliance with quality and safety requirements for fuels.
“We welcome the increased climate ambition and the flexibility provided under the FuelEU Maritime for meeting the targets. We also support a life cycle analysis of the fuels as a prerequisite for delivering carbon savings and for enabling a holistic approach. However, all these positive elements will be undermined and FuelEU may become a missed opportunity if the enforcement concerns are not addressed. Thus, we are pleased to see that enforcement is one of the major points that the EU Transport ministers will discuss tomorrow in the Council” said Claes Berglund, ECSA’s President.
Fostering demand is key and a shared responsibility between the EU fuel suppliers and shipping companies will ensure the uptake of cleaner fuels in shipping and the delivery of real carbon savings. In addition, any revenues generated under the EU ETS should contribute to lowering the price differential between cleaner and conventional fuels.
European shipowners have consistently called for the establishment of a fund under the EU ETS to leverage the revenues so that cleaner fuels become commercially available. ECSA welcomes the proposal for Carbon Contracts for Difference under the new EU ETS Innovation Fund.
“European shipowners have put forward workable solutions that deliver emissions reductions and safeguard industry’s competitiveness. A shared responsibility between the EU fuel suppliers and shipping companies will address substantial enforcement loopholes and will foster demand for cleaner fuels in the EU. The use of the ETS revenues under a sector-dedicated fund will lower the price differential and will contribute to making cleaner fuels commercially available in the market” said Sotiris Raptis, ECSA’s acting Secretary General.
ECSA supports the introduction of a multiplier of 4 to improve the competitiveness of cleaner fuels in the market. The use of cleaner fuels will be encouraged and incentivized by multiplying their contribution towards the targets of the FuelEU Maritime. European shipowners also support a full alignment of the Alternative Fuels Infrastructure Regulation (AFIR) with the FuelEU proposal by introducing additional port infrastructure requirements for other types of cleaner fuels such as hydrogen and ammonia.