
25th June 2024
Since January 2024, the European Union Emissions Trading System (EU ETS), originally tailored for land-based industries, has extended to the maritime sector - aiming to mitigate greenhouse gas emissions in the shipping industry. This expansion mandates that shipowners and operators partake in carbon emission management.
All inbound and outbound voyages, as well as port calls within EU waters, fall under the purview of this emission trading system shipping initiative.
The EU ETS functions by issuing a specific number of allowances into the carbon trading market. Shipowners or operators within its jurisdiction must purchase these allowances in direct proportion to their CO2 emissions, effectively offsetting their carbon emissions. Over time, the EU gradually reduces the number of available allowances, pushing ETS participants to either reduce their emissions or encounter increasing costs.
With the EU ETS extending to the maritime sector, shipping companies must promptly address the challenges that come with regulation compliance. One significant challenge is the substantial cost of carbon allowances, which has increased considerably in recent years, thereby intensifying the financial strain on shipping companies. Additionally, the limited availability of emission-reduction technologies poses another obstacle, restricting the options for companies to effectively reduce their emissions. Moreover, the decentralized nature of the shipping industry further complicates regulation as there is no unified regulatory authority to manage shipping emissions.
Shipping companies are obligated to forfeit allowances generated by their vessels, with the quantity of allowances dependent on the volume of emissions. Geographically, emission assessments consider both intra-EU and inbound or outbound voyages, resulting in fluctuating expenses.
In response to the regulations and compliance imperatives of the EU ETS emissions trading system, Wilhelmsen Ship Management and Affinity Shipping have collaborated to establish Hecla Emissions Management, a groundbreaking initiative. Hecla is dedicated to providing a comprehensive array of services aimed at aiding shipowners in complying with EU ETS regulations.
These services include: seamless integration into the EU ETS framework; thorough comprehension and navigation of EU ETS regulations; development of tailored compliance strategies; acquisition of carbon allowances from the market, as well as storage and trading of allowances.
With over 1000 vessels under Hecla's management across a multiplicity of sectors, Hecla's reputation as a specialist in EU ETS compliance allows shipowners to confidently move toward the implementation of practical, cost-efficient measures for emission reduction - sharing in Hecla’s extensive pool of EU ETS compliance acumen.
By harnessing Affinity’s expertise in all aspects of shipping and Wilhelmsen’s skill in technical management, Hecla aims to facilitate an easy and streamlined transition for shipping companies operating within the EU shipping emissions framework.
In conclusion, as the shipping sector adapts to the regulations of the EU ETS, a tailored approach becomes indispensable. Hecla presents a comprehensive strategy designed to address the unique requirements of the maritime industry. For shipping companies navigating the complex terrain of the EU ETS emissions trading system, Hecla stands ready to offer guidance and support in understanding regulatory frameworks, crafting compliance strategies, and implementing sustainable measures.
Contact us today to learn how our tailored solutions can future-proof your operations in the era of decarbonization.