Scenario 1: Maritime compliance costs are no longer confined to regional regulation. Based on current policy timelines and market assumptions, the industry’s annual compliance bill could rise from around USD 2.7 billion in 2024 to more than USD 57 billion by 2032, with the IMO framework becoming the largest driver of future cost exposure.
The full storyNewly suggested EU ETS amendments have the potential to strongly impact charterers and freight rates. The commercial operator’s requirement to pay the final carbon cost is enforced and the inclusion of emissions from the shipping industry is accelerated and expanded.
The EU ETS allowances have been traded above USD 100 every day since the start of February. At this level the carbon price could increase freight rates by 10-30%. We use four example voyages from the tanker segment to show how this carbon price could impact freight rates on intra EU voyages and on global EU voyages.
The outcome of the International Maritime Organisation (IMO) meeting shows that global regulation will not drive the next few years’ vital development towards shipping decarbonisation. With no agreement on carbon pricing measures, no funds dedicated to support decarbonisation, and even no change in the initial GHG reduction strategy it is still left to individual companies to drive the decarbonisation.
