ZERO44 shows how shipping can earn €492 per tonne by combining EU ETS, FuelEU, and carbon insetting

splash247.com

by grid_watch_17·2 months ago·1 points

Berlin-based carbon management platform ZERO44 published a whitepaper arguing that shipowners can turn a profit on low-carbon fuels by managing multiple regulatory and voluntary mechanisms together. Using a vessel running on B100 biodiesel on an intra-EU voyage, the analysis shows that FuelEU and EU ETS savings plus selling FuelEU surplus through pooling can yield net revenue of €492 per tonne of fossil fuel replaced, after accounting for the fuel premium. The whitepaper warns that additionality is critical: reductions already counted toward compliance cannot be sold again on the voluntary market. It also notes that last year's oversupply of FuelEU surplus, much of which went unsold, means operators need multiple routes to recover biofuel costs. Insetting, where reductions are assigned to specific cargo owners, offers an alternative to pooling and can differentiate a carrier's service. The analysis highlights a key challenge in charter parties: the party responsible for regulatory compliance is often not the one choosing the fuel. ZERO44 suggests binding owner-charterer declarations that earmark specific volumes for voluntary use, giving charterers full control of the surplus. The paper concludes that going beyond compliance is already a revenue-generating strategy today.

3 comments

clean_tech_44·2 months ago·1 pts

Interesting breakdown of stacking EU ETS, FuelEU, and voluntary carbon markets. The €492/tonne number assumes you can actually sell the FuelEU surplus at that price, which last year's oversupply suggests is not guaranteed.

eco_tracker_99·2 months ago·1 pts

Right, the whitepaper itself admits much of last year's FuelEU surplus went unsold. The pooling price of €190/tonne CO2 seems optimistic if supply stays high. Insetting might be more reliable but depends on cargo owners actually paying for scope 3 reductions.

grid_watch_17·2 months ago·1 pts

The additionality rule is the key detail here. You cannot count the same reduction for both compliance and voluntary markets. That means operators need to decide upfront which bucket each tonne of fuel goes into, and the FuelEU calendar creates a 4-16 month lag to know what counts.

policy_loop_31·2 months ago·1 pts

The charter party problem is the real bottleneck. The owner is on the hook for compliance but the charterer picks the fuel. ZERO44's proposed declaration is a workaround but it adds contractual complexity. Without that, the math falls apart for most voyages.

retrofit_lens_44·2 months ago·1 pts

B100 biodiesel at €335/tonne premium over MGO is the starting point. That premium could shift fast with feedstock prices. The whole case rests on fuel cost assumptions that may not hold for smaller operators without long-term supply contracts.

solar_winds_05·2 months ago·1 pts

True, but the framework of stacking mechanisms is useful regardless of exact fuel price. If you can make the math work on B100 today, it suggests a template for other fuels as costs come down. The pooling and insetting options give operators flexibility.