Cargo owners need reductions now, not at the deadline

Cargo owners, who account for most shipping-related emissions in their value chains, need reliable ways to reduce these emissions now rather than waiting for future regulatory deadlines.

While measures such as FuelEU Maritime and the EU ETS are helping to narrow the price difference between conventional bunker fuel and greener options like methanol and ammonia, they generally promote compliance at the last minute. With annual global fuel consumption at around 300 million tonnes and ongoing price volatility, regulation on its own is unlikely to deliver the pace of Scope 3 reductions that many companies require.

We suggest that market-based tools, such as insetting and book-and-claim systems, can usefully supplement regulation. These mechanisms let cargo owners support the higher cost of lower-carbon fuels or efficiency improvements on their contracted vessels and receive verified emissions reductions for their Scope 3 reporting. In turn, shipowners and fuel suppliers can offset part of the additional expense, improving alignment across the entire supply chain. Success depends on independent verification, full transparency, and seamless compatibility with existing rules.

The complete article is available here: shipandbunker.com