The European Commission has presented a proposal to revise the EU Emissions Trading System (EU ETS), with the aim of strengthening support for the decarbonisation of the maritime sector while addressing concerns related to carbon leakage, administrative burden and the competitiveness of European ports.
The proposal extends the scope of the Monitoring, Reporting and Verification (MRV) Regulation to include oil tankers, chemical tankers, gas carriers, LNG carriers, Ro-Pax vessels and passenger ships below 5,000 gross tonnage (GT), but not below 400 GT, from 2029. With regard to offshore activities, the proposal replaces the current reference to offshore ships with a broader definition covering ships performing or supporting offshore operations in connection with worksites located within the territorial sea, exclusive economic zone (EEZ) or continental shelf. In addition, the Commission would be empowered to adopt delegated acts extending the scope of the MRV Regulation to new categories of ships below 5,000 GT where appropriate. For offshore operations, ETS exposure can be linked to an offshore worksite connected to a Member State’s territorial sea, exclusive economic zone or continental shelf.
Another key element of the proposal is the allocation of 110 million EU ETS allowances to support the uptake of clean shipping fuels and propulsion technologies. The Commission also proposes that 50% of Member States’ ETS revenues continue to be earmarked for climate and energy-related purposes, with shipping decarbonisation identified as one of the priority areas. At EU level, ETS revenues will continue to finance initiatives such as the Innovation Fund, which provides grants to scale cutting-edge, low-carbon technologies, aiming to decarbonize European industries, the Modernisation Fund that helps 13 lower-income member states upgrade their energy systems and the future Industrial Decarbonisation Bank, which is expected to mobilise up to €100 billion to accelerate the deployment of low-carbon technologies across European industry.
The proposal also aims to strengthen the integrity of the maritime EU ETS by revising the criteria for identifying neighbouring container transhipment ports. The amended provisions would allow the European Commission to include additional non-EU terminals on the list of neighbouring container transhipment ports, with the objective of limiting carbon leakage and reducing incentives for vessels to reroute cargo through ports outside the EU to avoid ETS obligations.
In addition, the Commission proposes an “ETS-as-a-service” mechanism, allowing third countries to adopt the EU carbon pricing framework for maritime emissions in exchange for a share of the revenues. Simplified reporting requirements between the EU ETS, MRV Regulation and FuelEU Maritime are also expected to reduce the administrative burden for shipping companies, while new provisions aim to ensure a level playing field for offshore operators.
Concerning the IMO negotiations on a global framework, the proposal addresses only double payments in relation to a future IMO global agreement. not guaranteeing the review and withdrawal of the EU measures once a global agreement is adopted at the IMO. Furhtermore, the proposal extends the derogations for islands, outermost regions and ice-class vessels to 2035.
The proposal will now be examined by the European Parliament and the Council as part of the ordinary legislative procedure.
The ETA Secretariat has been closely following these developments and engaging with stakeholders to assess their potential implications for towage operators, particularly in relation to the possible extension of reporting and compliance requirements to smaller vessels.
