What are the requirements for EU ETS compliance?
Each shipping company will need to be registered with an administering authority in the EU. Following the publication of the European Committee’s implementing acts on 1 October 2023, an updated Monitoring Plan must be submitted for verification and verified by an accredited body within three months. The verified Monitoring Plan must be submitted to the administering authority by 1 April 2024.
Starting in 2025, the shipping company must submit verified aggregated emissions data at the company level to the administering authority by 31 March of each year. This data is to be based on the MRV Emissions Reports for the previous year, in line with a revised MRV Monitoring Plan, which is required from 1 January 2024. In practice, this means the ship emissions report needs to be verified and submitted a month earlier, at the latest, than under the current MRV system.
The scope of EU ETS compliance
The emission allowances (see tab EU Allowances) corresponding to a certain amount of GHG emissions are required to be surrendered to the administering authority by 30 September of each year. Failure to surrender allowances within the deadline for a single ship can affect compliance for an entire fleet.
Companies that fail to surrender allowances are liable to an excess emissions penalty of 100 Euros per tonne of CO2 and are still liable for surrender of the required allowances. Failure to comply for two or more consecutive periods may result in the ships of the company being banned from trading in the EU.
EU ETS based on percentage of emissions on voyages (Click here to view the image in a higher resolution)
See overview tab for details on voyages and emissions included in the EU ETS.
EU ETS annual compliance cycle in a nutshell
The yearly EU ETS cycle begins with an individual ship’s MRV Emissions Report being submitted to a verifier, who then issues verification of the report. The individual ship data or fleet data are also sent to the verifier, who subsequently issues a Company Emissions Report. All of the company’s emissions data then need to be submitted together to the administering authority by 31 March of each year. By 30 September of each year, the emission allowances must be surrendered to the administering authority.
EU ETS yearly cycle (Click here to view the image in a higher resolution)
DNV compliance services
DNV Group company DNV GL SE is the accredited body for EU MRV verification services as per the EU Regulation 2023/957. Consequently, the verification of EU MRV Emission Reports and aggregated emissions data at the company level, as well as the issuance of EU MRV compliance documents, are provided to you by DNV GL SE as an accredited body.