“Fuel selection is the most important lever under FuelEU,” said OceanScore Managing Director, Albrecht Grell. “Your choice of fuel can either create a surplus or a deficit in your compliance balance, directly affecting your costs.” Grell added: “Choosing the right fuel can help avoid penalties and even create revenue by pooling surpluses. But not all alternative fuels are the same, and their viability often depends on future pooling prices, which are hard to predict.” FuelEU charts a course for reducing emissions in shipping, with a target near net-zero by 2050. For now, two main options are available to meet the greenhouse gas (GHG) threshold of 89.3g CO2e/MJ until 2029: LNG and LPG: These fuels, when used in dual-fuel engines, will meet the rules and can generate surplus compliance balances. However, their benefits will decline until 2040 as limits tighten. Biofuels: These are a good option for most vessels. They are usually used in blends (eg. B20-B30) with conventional fuels. These blends will be compliant until 2040; higher blends or pure biofuels will be needed thereafter. One issue is that EU ETS and FuelEU Maritime treat biofuels differently. Under EU ETS, biofuels are considered zero-emission, meaning companies do not need to buy carbon credits. But under FuelEU, the rules are stricter. “FuelEU doesn’t count all biofuels equally,” Grell explained. “Fuels made from food or feed crops are treated like conventional fuels in terms of emissions. Only waste-based biofuels are fully compliant, and even then, their specific GHG values are above zero.” This difference matters. Standard biofuels, such as those from rapeseed or sunflower seeds, still benefit from ETS discounts but fall short under FuelEU. For full compliance, waste-based biofuels are needed, such as those from used cooking oil or animal fat. Further complications are added when considering the different rules behind the 50% discounts applied to voyages to and from the EU under the two regulations. OceanScore, which provides advanced solutions to facilitate efficient regulatory compliance, is assessing the impact of alternative fuels based on their relative carbon intensities, calorific values (LCVs), prices, and ETS cost incurred, reflecting these in its FuelEU Planner. The challenge goes beyond selecting fuels with low GHG intensity and factors such as the vessel's ice class or whether voyages are intra-EU or international also influence compliance balance. If companies bunker more expensive alternative fuels like biofuels, there is no guarantee it will always pay off. “FuelEU allows for pooling of compliance surpluses and deficits,” Grell added. “Surpluses generated by using compliant biofuels can be sold in the compliance market to vessels in deficit.” OceanScore’s analysis indicates that the compliance market will be in surplus by 1 January 2025. “This surplus will put downward pressure on pooling prices, meaning it might be cheaper to buy a compliance surplus in the pool rather than generate it through compliant bunkering on your own vessels,” Grell said. “Both approaches would be compliant with FuelEU regulation and need to be considered at least from a commercial angle.” Given this, any sound compliance strategy must look beyond fuel selection alone and consider the broader market dynamics. “Our FuelEU Planner integrates these variables into a comprehensive scenario simulation,” continued Grell. “This is crucial because tackling FuelEU successfully requires charterers, managers, and owners to collaborate using a shared, fact-based approach.” Grell outlines several key steps for shipping companies to optimise their compliance strategies. First, they must gain a thorough commercial understanding of the economics of different fuels, considering their prices, LCVs, EU ETS costs, and the cost of pooling FuelEU compliance balances. At the same time, the technical and operational feasibility of using biofuels across different vessels should be assessed. While tests so far indicate that biofuels can be used without significant issues, lingering concerns over engine compatibility and tank systems remain. “Engine manufacturers need to give the green light, and bunker providers must be identified in key ports,” Grell noted. “For now, many companies focus biofuel usage on a smaller portion of their fleet to simplify operations and reduce risks.” However, one of the biggest hurdles remains contractual. “How do you protect the DOC holder, who is responsible for penalties, from the fuel decisions of the charterer? How do you fairly share the costs of biofuels and the value of surpluses? And how do you manage uncertainties tied to deployment patterns and fuel accountability under FuelEU?” Grell asked. Without clear contractual terms, companies risk major financial and operational pitfalls. “To align incentives across owners, managers, and operators, you need clauses in agreements like Shipman and Charter Parties,” he stated. “The ‘polluter pays’ principle is not embedded in FuelEU, so a robust data-driven understanding of the entire value chain is essential to avoid costly disputes.” OceanScore’s FuelEU Planner provides a clear path through the complexity. By simulating fuel use, compliance costs, and pooling options, the tool enables companies to budget effectively and negotiate data-driven contracts. “We make the complex FuelEU regulations easier to manage,” Grell concluded. “With our solutions, companies can understand the commercial impacts of their fuel choices, gain full transparency and confidently manage their compliance strategy.” You might also like Veolia, Enagás, and Barcelona City Council inaugurate first urban cold recovery network from LNG terminal

Greek shipping companies are set to face a total bill of over €175m in penalties incurred under FuelEU Maritime after it takes effect next year but can also capitalise on the use of alternative fuels both to curb their financial exposure and generate compliance surpluses, according to OceanScore.

OceanScore has launched a new planning, simulation and budgeting tool for optimising compliance with FuelEU Maritime from a commercial standpoint. Its FuelEU Planner is the first in a suite of solutions geared to supporting complex decision-making processes with the upcoming regulation.

OceanScore, global provider of data and compliance management solutions for the maritime industry, has successfully closed an oversubscribed €5 million Series A financing round. The influx of new capital will enable the company to further develop its solutions portfolio and expand its global footprint.

The upcoming implementation of FuelEU Maritime has shipping companies on high alert due to potential penalties for non-compliance with greenhouse gas (GHG) intensity reduction targets, says the Hamburg-based provider of compliance and data solutions, OceanScore.

OceanScore has opened a new office in Singapore to serve its regional clients, responding to the growing demand in Asia for its digital solutions designed for efficient regulatory compliance with the EU ETS and FuelEU Maritime.

Shipping could rack up €1.35bn ($1.46bn) in penalties in 2025 under the incoming FuelEU Maritime regulations, with a potential new market emerging for the sale and purchase of surplus energy volumes according to experts.

OceanScore has identified the segments set to be hit hardest. OceanScore forecasts that shipping as a whole will rack up total FuelEU penalties of €1.345bn in 2025 through analysis of the 13,000 vessels over 5,000 gt trading within and into the EU/EEA that are subject to the regulation.

Implementation of the FuelEU Maritime regulation from 2025 presents an accountability dilemma for shipping as it is currently the Document of Compliance (DoC) holder that will be held responsible for fuel selection and could therefore face penalties – contrary to the ‘polluter pays’ principle, according to OceanScore.

Validation of voyage emissions data and contractual arrangements for allocation of EU ETS costs remain key challenges for Greek shipowners as they face an estimated total €335m bill this year, potentially rising to €1bn once the regulation is fully implemented, according to OceanScore.