T&E: 6% hydrogen-based fuel mandate under FuelEU Maritime will promote use of hydrogen in shipping

The European Union’s ‘Fit for 55’ package of measures and in particular, the extension of the EU ETS to shipping and the FuelEU Maritime Regulation are subject to negotiation in Brussels while shipowners put efforts to introduce amendments to the originally proposed text.

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Concerning the revision of the EU ETS, discussions include the definition of the ‘commercial operator’ in a bid to make charterers equally responsible for carbon emissions as well phasing-in the implementation between 2023 and 2025 or 2026.

In order for the proposal to promote the uptake of green hydrogen, T&E suggested the following recommendations:

Recommendation 1: Mandate a 6% green Hydrogen (-based fuel) use in EU shipping by 2030 under the draft FuelEU Maritime Regulation. The goal of FuelEU Maritime regulation is to create demand for alternative marine fuels for shipping. The draft legislation is currently under negotiations in the EU Council and EU Parliament.

Recommendation 2: Advance EC proposed regulatory targets by 5 years and set 2050 as the sunset date for the last use of GHG emitting fuels.

Recommendation 3: Apply a multiplier of 5 to the use of green H2(-based fuels) in shipping under the FuelEU Maritime Regulation. Multiplier functions like a “discount” system allowing the use of each tonne of green H2(based fuels) count 5 times towards achieving the regulatory targets. In practice, this helps to fully bridge the cost-gap between green H2(based fuels) and fossil fuels. Multiplier should only apply to volumes used above the sub-quota in order to provide additional incentives to shipowners/operators to switch to green H2-based fuels.

EXPLORE MORE AT T&E’S REPORT ON FUELEU