Shipping & EU-ETS
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Closed-door trilogue talks on Tuesday ended with some important updates regarding the inclusion of the shipping industry in the European Emissions Trading System (EU-ETS), the cornerstone of the European policy to reduce greenhouse gas emissions and fight climate change. Members of the European Parliament, the Council of Member States and the European Commission have agreed a unified position on key parameters that had previously caused disagreements between the three institutions:

  • Emissions from ships larger than 5.000 gross tonnage will be included in the EU-ETS gradually, as in the Commission's original proposal, but the starting date will be postponed by one year and compensated by a quicker phase-in. The current deal on shipping would mean that 35% of the CO2 emissions released in 2024 will be covered by the EU-ETS, 75% in 2025 and finally 100% in 2026. The original Commission proposal had 20% in 2023, 45% in 2024, 70% in 2025 and 100% in 2026.
  • The 50% discount is still applied to voyages made from an EU port to a non-EU port and vice versa.
  • Other emissions such as nitrogen oxide, soot and methane will be measured as from 2024 and then included in the EU-ETS from 2026.
  • Offshore service vessels are to be included in the monitoring mechanism from 2025 and then in the ETS from 2027.
  • Small vessels, between 400 and 5.000 gross tonnage, will have the same emission monitoring obligation from 2025 but without the need to pay for the emissions, and a revision of the EU-ETS in 2026 is to determine whether they are to be included in the ETS as well.

All agreements reached in this trialogue are still subject to formal approval by the three institutions in a process that usually takes at least several weeks to achieve. Furthermore, the lead MEP and rapporteur on the EU-ETS reform bill Peter Liese reiterated that a final agreement on shipping had not yet been struck and that it may not come before the next trialogue scheduled on November 29.

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