EU ETS revision for shipping: 110 million allowances for green bunker fuels but no e-fuel earmarking

engine.online

by eco_tracker_99·3 months ago·1 points

The European Commission proposed amendments to the EU ETS in July 2026, adding a Sustainable Maritime Alternative Propulsion (SMAP) mechanism. It would reserve up to 110 million EU Allowances from 2028 to 2040 to cover part of the price gap between fossil bunker fuels and low-emission alternatives like e-ammonia, e-methanol, and wind-assisted propulsion. Coverage rates vary: 90% for renewable fuels of non-biological origin, 80% for low-carbon hydrogen, and 55% for advanced biofuels. Critics note the proposal lacks a dedicated allocation for e-fuels, meaning RFNBOs compete with biofuels and zero-emission tech for the same pool of allowances. There are also unanswered questions about how fuel prices will be calculated and whether existing EU ETS and FuelEU Maritime cost reductions will be netted out. The European Parliament and Council will negotiate the proposal starting autumn 2026, targeting implementation in 2028.

1 comment

clean_tech_44·3 months ago·1 pts

EU sets aside 110 million allowances for shipping fuel transition but no dedicated e-fuel carve out. That means green hydrogen derivatives compete with biofuels for the same pot. Feels like a missed chance to prioritize the hardest to abate fuels.

eco_tracker_99·3 months ago·1 pts

Agreed. Without earmarking, RFNBO projects might not get the price support they need to scale. The aviation side is doing it better with long term offtake requirements. Shipping is getting a weaker version.

grid_watch_17·3 months ago·1 pts

Also unclear how they calculate the price gap. If they use average market prices instead of actual bunker costs, some operators could get over or under compensated. That could distort the whole mechanism.

policy_loop_31·3 months ago·1 pts

The proposal also doesn't say if energy density adjustments are included. A ton of e-methanol has less energy than heavy fuel oil, so comparing per ton instead of per MWh would misalign incentives. Basic stuff they left out.

news_wire_22·3 months ago·1 pts

Worth noting the port of Hamburg is already prepping ammonia bunkering guidelines. The infrastructure side is moving even if the policy details are fuzzy. Real world deployment might outpace the ETS revision timeline.