EU ETS & FuelEU Maritime — CJ Energy Solution

Executive Summary

Two Levers, One Decarbonisation Direction

EU ETS puts a carbon price on shipping emissions — it changes the cash cost of conventional fuels for voyages touching EU ports. FuelEU Maritime sets a declining GHG intensity limit on energy used on board — it changes the compliance value of the fuel pathway itself.

Together they transform procurement from a price-per-tonne decision into a three-part calculation: fuel price · ETS exposure on the trade lane · FuelEU lifecycle intensity and documentation quality. The winners will be those who master all three.

ETS

EU ETS

Carbon pricing — surrender allowances for verified emissions

Live: 1 January 2024

Logic: Carbon price on reported emissions

Unit: Tonnes CO2e → EUA allowances

Basis: MRV / tank-to-wake scope

Effect: Raises delivered fuel cost

CH4/N2O: Added from 2026

FEU

FuelEU Maritime

Fuel intensity standard — annual average GHG intensity limit

Live: 1 January 2025

Logic: Maximum energy intensity standard

Unit: gCO2e/MJ annual average

Basis: Well-to-Wake lifecycle

Effect: Rewards lower-carbon fuels

Ref: 91.16 gCO2e/MJ baseline

EU ETS Deep-Dive

Carbon Pricing — How It Works for Shipping

Ships of 5,000 GT and above calling at EU ports must surrender EU Allowances (EUAs) for verified emissions. The scope covers 100% of intra-EU and port emissions, and 50% of extra-EU voyage legs.

ETS Phase-In: % of Emissions to Surrender

40%

70%

100%

2025
(2024 emissions)

2026
(2025 emissions)

2027+
(full exposure)

100%

Intra-EU voyages & port emissions in scope

50%

Extra-EU voyage legs (start or end outside EU/EEA)

2026

CH4 and N2O added to ETS coverage

Reporting Rhythm

Monitoring and reporting runs through the MRV system. First maritime ETS surrender deadline was September 2025 for 2024 emissions. Verified company and ship emissions submitted annually — documentation quality now has direct cash consequences.

FuelEU Maritime Deep-Dive

Fuel Intensity Standard — The Lifecycle Lens

FuelEU measures the annual average GHG intensity of energy used on board on a well-to-wake basis, covering CO₂, CH₄, and N₂O. Reference value is 91.16 gCO₂e/MJ. The required reduction grows every five years through 2050.

GHG Intensity Reduction Pathway — Required vs 91.16 gCO₂e/MJ Reference

2025

2%

89.34 gCO₂e/MJ

2030

6%

85.69 gCO₂e/MJ

2035

14.5%

77.94 gCO₂e/MJ

2040

31%

62.90 gCO₂e/MJ

2045

62%

34.64 gCO₂e/MJ

2050

80%

18.23 gCO₂e/MJ

Key Compliance Dates

Aug 2024 — Monitoring plans due
Jan 2025 — First reporting year begins
Jan 2026 — First FuelEU report to verifier
2026 — Verification period for 2025 data

Zero-Emission at Berth

Applies to container & passenger ships
Jan 2030 — AFIR-covered EU ports
Jan 2035 — All EU ports with OPS
Requirement: OPS or zero-emission tech

Framework Comparison

EU ETS vs FuelEU — Side by Side

Topic	EU ETS	FuelEU Maritime
Main logic	Carbon pricing	Fuel/energy intensity standard
Main unit	Tonnes CO2e → EUA allowances	gCO2e/MJ annual average
Emissions basis	MRV / ETS scope (TtW)	Well-to-Wake lifecycle (WtW)
Geographic scope	100% intra-EU + ports; 50% extra-EU legs	Same general principle for energy on voyages in scope
Commercial effect	Adds allowance cost to delivered fuel price	Creates compliance deficit or premium for low-GHG energy
Fuel implication	Penalises higher reported emissions	Rewards lower lifecycle intensity

Critical point: The two systems are complementary, not interchangeable. EU ETS changes the cash cost of emissions; FuelEU changes the compliance value of the fuel pathway itself. A fuel can help under one and underperform under the other depending on TtW vs WtW treatment, methane slip, and documentation quality.

Fuel-Specific Implications

How Each Fuel Type Performs Under Both Frameworks

Conventional HFO / MGO

ETS Exposure High

Operationally simple but faces both ETS allowance costs and a worsening FuelEU position as targets tighten. Manageable short-term, weakening long-term compliance profile.

LNG

Methane Slip Risk

Can perform better on ETS in some contexts, but FuelEU outcome depends heavily on methane slip and lifecycle assumptions. Now a documentation-and-engine-technology story as much as a molecule story.

Biofuels

Strong if Certified

Commercially powerful when the sustainability chain is properly documented. Proof of Sustainability and robust certification are essential — lifecycle performance, not just volume, drives compliance value.

E-Methanol / E-Fuels

Future Compliance

Attractive for deeper FuelEU compliance over time. Challenges: availability, price, supply bankability, and consistent WtW documentation. The long-game fuel option.

2026 Watchpoints

What Marine Fuel Experts Should Track

01

Allowance exposure by route mix

Intra-EU services and port-heavy trades carry stronger ETS consequences. Route profiling is now a commercial necessity, not optional analysis.

02

FuelEU pooling and flexibility use

Compliance strategy will increasingly be managed at fleet level, not just ship-by-ship. Pooling agreements and surplus/deficit banking need to be in procurement frameworks now.

03

Methane-slip treatment

Especially material for LNG and dual-fuel fleets. The difference between optimistic and realistic slip assumptions can shift FuelEU compliance position significantly.

04

Fuel certification quality

Poor documentation can destroy the compliance value of an otherwise low-carbon fuel. Certification chain integrity is now a sourcing criterion, not an afterthought.

05

OPS readiness in ports

Container and passenger operators must prepare before the 2030 AFIR deadline. Early port assessments and capex planning should begin now.

06

EEA implementation details

FuelEU application in Norway and Iceland was delayed due to EEA incorporation timing. Route treatment needs checking case by case for trades calling those ports.

Commercial Takeaway

The New Marine Fuel Market Logic

The market is no longer about selling a bunker product. It is about selling a bunker plus emissions profile plus compliance data package.

Three-Part Procurement Lens

1

Price per tonne or per MWh — the traditional fuel cost anchor

2

ETS exposure on the trade lane — route-specific allowance cost

3

FuelEU lifecycle intensity and documentation quality — the WtW compliance value