The Fuel EU Maritime is the latest EU regulation aimed at the maritime sector, which came into force on the 1st of January 2025. It is part of the European Union’s broader “Fit for 55” package of legislation, which aims to reduce net greenhouse gas emissions by at least 55% by 2030 compared to 1990 levels and achieve climate neutrality by 2050. Fuel EU Maritime is designed to incentivise the uptake of lower-carbon alternative fuels in vessels by penalising the use of most conventional fossil-based marine fuels.
What is FuelEU Maritime?
FuelEU Maritime sets a limit on the well-to-wake greenhouse gas intensity (GHGI) of the energy used onboard vessels that call into the EU. A well-to-wake perspective encompasses all GHG emissions; from upstream processes of sourcing, production, and transportation of fuels, in addition to the emissions from the physical burning of the fuels onboard.
In the first period 2025-2030, the GHGI of energy used must fall by 2% from the 2020 baseline. This reduction increases every five years, culminating in an 80% reduction limit in the GHGI of energy used onboard vessels by 2050. It applies to vessels over 5000 GT and covers 50% of the energy used on voyages in and out of the EU, and 100% of the energy used for voyages within the EU. Passenger and container vessels have an additional mandate that from 2030 requires them to make use of onshore power when moored at EU ports.
FuelEU Maritime progression
How can vessels comply?
There are several ways to fulfil FuelEU obligations, most of which are forms of behaviour change incentivised by the regulation. Vessels can consume lower-carbon fuels such as biofuels, instead of conventional fossil fuels.
Those that generate overcompliance can leverage their compliance surplus by forming a pool and offsetting under-compliant vessels or banking it for future periods. Vessels also have the option to borrow compliance from the next period, with the obligation to pay interest on the energy allowance borrowed with a surcharge of 10%.
Whilst the regulation strongly incentivises behaviour change in order to comply, vessels can also do nothing and pay the sizeable penalty of €2,400 per tonne of low-carbon fuel that could have been consumed as a final compliance option.
Compliant fuels
FuelEU Maritime incentivises the uptake of lower-carbon fuels such as waste-based biofuels consistent with the EU Renewable Energy Directive II (RED II). In addition to UCOME-based biofuel blends like B30 and B24, the trajectory of the limit encourages the development of bio-LNG, bio-methanol, and Renewable Fuels of Non-Biological Origin (RFNBOs). An RFNBO usage sub-mandate is set to be introduced in 2034 but may be revised if production has not sufficiently scaled up.
In the early periods LPG and fossil LNG is supported by the regulation, but methane slip and engine types are important factors to understand the horizon of such compliance. The growing adoption of biofuels will be increasingly important as the legislation’s GHGI limit becomes more stringent over time. Whilst Used Cooking Oil based UCOME is currently the most common biofuel available, biofuels from advanced feedstocks will become more popular.
Options for over-compliant vessels
Vessels that are over-compliant have additional value under the regulation. They can lead the forming of FuelEU Pools, where a vessel’s compliance surplus can offset another vessel’s deficit by allocating the surplus to them. As long as the compliance balance of the entire pool remains below the stated GHGI limit, all vessels within the pool will be counted as compliant.
Alternatively, over-compliant vessels can choose to bank their surplus. This can be banked indefinitely and used in a subsequent compliance period. For instance, an LNG vessel with a low methane slip engine would normally become non-compliant from 2036, but if it had banked its compliance surplus each year since 2025, it could use this banked surplus to extend its regulatory compliance beyond 2040.
Supporting customers with a range of options
Vitol supports customers with a variety of bunker products tailored to their fuel and emissions needs, supplying FuelEU compliant marine fuels up to B100 on any of our specialist IMO Type II barges.
Due for delivery in 2025, LNG bunkering barges will offer shipowners a long-term solution for compliance with the increasingly stringent emission regulations. LNG, a fuel in transition, enables shipowners to achieve emissions objectives with negative carbon intensity (CI) bio-LNG, supporting vessels to be compliant up to and beyond 2050.
The Fuel EU Maritime is undoubtedly a complex regulation, with a range of compliance options available for vessels to choose from. By leveraging its robust commercial, technical, and regulatory experience and expertise, Vitol International Shipping is well positioned to provide a range of services to support in an increasingly complex maritime world.