The European Commission has proposed widening the scope of the EU’s carbon market to cover significantly smaller vessels, according to Ship & Bunker.
Under the plan unveiled on Friday, the European Commission set out a proposed revision of the EU Emissions Trading System (EU-ETS) directive that would apply the scheme to all ships over 400 gross tonnage (GT). Ship & Bunker reports that this marks a substantial reduction from the current threshold, which only applies to vessels above 5,000 GT.
What the Proposal States
According to the text of the proposal cited by Ship & Bunker, the Commission stated: “No later than 31 December 2031 the Commission shall present a report to the European Parliament and to the Council in which it shall examine the feasibility and economic, environmental and social impacts of the inclusion in this Directive of emissions from ships, below 5,000 gross tonnage but not below 400 gross tonnage.”
This language indicates that while the Commission is proposing the lower threshold, a formal feasibility and impact assessment would still need to be completed before the extended scope takes full effect, with a deadline set for the end of 2031.
Next Steps
Ship & Bunker notes that the proposed revision to the EU-ETS directive must still be approved by the European Parliament before it can become law. This means the plan remains subject to further legislative review and is not yet finalized.
Does This Matter to You?
The EU-ETS currently applies a carbon price to emissions from larger commercial vessels operating in or calling at EU ports. Extending coverage down to 400 GT would bring a considerably broader segment of the fleet into scope, potentially including smaller cargo vessels, coastal traders, and other vessel types that previously fell below the reporting and compliance threshold.
Operators, charterers, and traders involved with smaller vessels trading in or near EU waters may want to monitor how this proposal progresses through the European Parliament, given that it could eventually alter compliance obligations for a wider range of ship sizes. However, as the source material makes clear, the measure is still a proposal pending legislative approval, and the Commission’s own feasibility report on the 400 GT to 5,000 GT segment is not due until the end of 2031. The direct operational and cost impact for smaller vessel operators is therefore not yet clear based on available information.
Gulf Bunkering does not provide operational or security guidance. This article is for informational purposes only. Operators should consult flag state authorities, P&I clubs, and relevant advisories for decisions relating to transit planning.
Sources: Ship & Bunker
